Bullion markets close for third day to protest gold duty hike

Bullion markets across the country, including Delhi and Mumbai, closed for the third straight day today as traders continued protests against the budgetary proposals to raise duty on gold imports and levying excise duty on unbranded jewellery.

Bullion markets in the national capital and most of showrooms remained closed in several parts of the country, All India Sarafa Association President Sheel Chand Jain said.

“The budgetary proposals of a hike in import duty on gold and levying of 1 per cent excise duty on non-branded jewellery would affect business and wipe-off the existence of nearly 95 per cent of small jewellers in the country,” he said.

Mr. Jain said the proposal of a hike in import duty on gold will encourage smuggling of the precious metal.

He has urged Finance Minister Pranab Mukherjee in a letter to withdraw the proposal of levying one per cent excise duty on non-branded gold jewellery to save the traders.

Finance Minister Pranab Mukherjee on Sunday told bullion dealers, who have gone on strike against the levies on gold, that their pressure tactics “will simply not work”.

“I did it deliberately,” he said in an interview when asked about the three-day strike by bullion dealers across the country to protest the levies.

He explained that in two consecutive years, about $ 90 billion of precious foreign exchange was used in importing gold making it the second biggest item of import after oil.

Meanwhile, jewellers and goldsmiths in Phagwara in Punjab also kept their shutters down today to join the nationwide protest.

They observed the strike for the third consecutive day in line with countrywide strike call by goldsmiths and jewellers, Mohanjit Jaura, president of Swarnkar Sangh, Phagwara said.

He alleged that doubling of import duty would lead to hike in prices of gold and further burden customers, adversely affecting business of goldsmiths.

“Two per cent duty was clamped on January 17 only and now there is proposal to hike it to four per cent,” he said.

“Besides, unbranded gold jewellery has also been covered under central excise of one per cent. It will hit small jewellers. This step has been taken only to placate Corporate houses engaged in branded jewellerey,” he added.

However, bullion traders and jewellers in Chandigarh were open.