Bullion and jewellery markets remained closed for the seventh day today in various parts of the country to protest doubling of import duty on gold and imposition of excise duty on unbranded jewellery.
While markets in Mumbai and Chennai were closed for ‘Gudi Padwa’ festival, jewellery traders in other parts of the country continue the indefinite strike called by various associations.
Market sources claimed that the industry has lost business of over Rs. 6,000 crore in the last six days and it might rise further with more markets like Uttar Pradesh and neighbouring areas joining the protest.
Bullion traders in Kanpur has joined the strike as nearly 368 jewellery shops remained shut. Traders have also threatened to take to the streets if the Centre did not roll back the duty hike.
Traders are protesting against the budget proposal imposing excise duty of one per cent on unbranded precious jewellery and doubling of customs duty on standard gold bars and coins to four per cent.
Uttar Pradesh Bullion Traders Association President Shyam Bihari Mishra said that new tax proposals would lead to rise of ‘licence raj’
All India Sarafa Association President Sheel Chand Jain said that a letter in this regard had been sent to Finance Minister Pranab Mukherjee demanding roll-back of the budgetary proposals.
“The proposed increase in import duty will lead to unchecked smuggling of the metal. This increase of import duty should be withdrawn in the larger interest of the trade and consumers,” the letter had said.
Traders warned that imposition of higher levies may lead to a rise in retail gold prices by over six per cent in the country, which is seeking to rein in a widening current account-deficit partly fuelled by record purchases in 2011.
Imports may fall over 35 per cent this year from a record 969 tonnes in 2011, while the industry might face more difficult time in coming days as marriage season begins, traders said.