Government hikes duty drawback rate on gold to promote jewelry export
The government gave an incentive to the exporters of gold ornaments by hiking the duty drawback rate by Rs 73 to Rs 173.7 per gram on gold jewelry.
What is a Duty drawback?
- Duty drawback is the refund of duties on imported inputs for export items.
How will it affect exporters and Indian economy?
The move for duty drawback has come at a time when huge import of gold is exacerbating the country’s Current Account Deficit (CAD), which is likely to be at a high level of around 5% of the GDP.
The move will help jewelry exporters who are looking to increase the exports to $50 billion this fiscal as against $40 billion in 2012-13.It will help them in offsetting the high duty which they are paying for their import components consequent to hike in the import duty to 8%.