Govt cuts gold duty drawback rate by 3.1 pc, silver by nearly 9 pc

New Delhi, October 16 (IANS): The central government on Friday reduced the duty drawback rates applicable to the export of gold and silver jewellery, as well as other precious metal products.According to a notification issued by the Ministry of Finance, the duty refund on gold jewellery has been cut by 3.1 per cent, while the refund on silver jewellery and other such products has been reduced by approximately 9 per cent.The decision will lower financial gains for Indian jewellery exporters compared to before, and it could have a direct impact on their profit margins.Following the revision, the duty drawback rate for the export of gold jewellery has been reduced from Rs 1,851.99 per gram to Rs 1,794.11 per gram.The reduction is even more significant for silver-based products. The rate for the export of silver jewellery and other silver items has been lowered from Rs 29,501.09 per kilogram to Rs 26,859.02 per kilogram.Duty drawback is a mechanism through which exporters receive a refund of customs and other duties paid on raw materials or inputs used in the production of goods intended for export.Its objective is to enhance the competitiveness of exports and alleviate the burden of production costs.Earlier, in July this year, the government had provided relief to the jewellery export sector by significantly increasing the duty drawback rates.At that time, in light of rising costs and global uncertainties, the refund for gold jewellery was raised from Rs 773.17 per gram to Rs 1,851.99 per gram.Similarly, the rate applicable to silver products was increased from Rs 14,990.66 per kilogram to Rs 29,501.09 per kilogram.However, industry experts believe that if demand in the global market remains strong, the impact on exports could be limited.