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What are the various schemes for exporters of gems and jewellery

March 9, 2021

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jewel — Image source: https://cutt.ly/RzjRnXg

This article is written by Bhumika Dandona from the School of Law, Sushant University, Gurgaon. This is an exhaustive article which deals with all the benefits and schemes that are provided to the exporters of gems and jewellery in India.

Table of Contents

Introduction

The trade of gems and jewellery in India is an activity that has been prevalent since the start of one of the world’s oldest civilisations, the Indus Valley Civilisation. Jewellery was the most common out of all remains found here. Excavations from Harappan sites yielded rich pieces of jewellery made out of materials such as ivory, copper, terracotta, burnt clay, bones etc. Even today, interest in gems and jewellery amongst people soars high. This industry largely contributes to the Indian economy and generates an enormous amount of employment as well.

For this reason, the Ministry of Commerce and Industry (Government of India) set up the Gems and Jewellery Export Promotion Council (GJEPC) in 1966. The organisation aims at promoting the work of various artisans and designers to establish India as a global player in the jewellery sector by providing them with assistance in selling their commodities abroad and other services.

Various schemes for the exporters of gems and jewellery from GJEPC

Export benefit (financial) schemes that GJEPC extends to all the gems and jewellery exporters are as follows:

Market Development Assistance Export Scheme

Market Development Assistance Export Scheme is a government endowment available to all the exporters and provides funding for export promotion activities. It supports the following:

Assistance for exporters in export promotion activities abroad.
Assistance for Export Promotion Councils (EPCs) to shoulder promotional activities for their products and services.
Assistance for approved organisations and trade associations in shouldering exclusive non-recurring innovative activities in connection with export promotion efforts for their members.
Assistance for Focus export promotion programmes in specific regions abroad like Focus (LAC), Focus (Africa), Focus (CIS) and Focus (ASEAN + 2) programmes.
Assistance for remaining essential activities connected with marketing promotion efforts abroad.

Assistance for participation in export promotion activities abroad

Exporting companies who have f.o.b. (free price onboard) of exports of up to Rs. 30 crores are eligible for availing MDA export scheme for participation in events abroad and exporting their products from India. It is subject to the condition that the exporters have at least 12 months of membership with the involved EPC and have regularly filed their returns. However, the scheme is not applicable unless an EPC has completed five years from the date of its creation.

Assistance with regards to travel expenses and creation of stalls is permitted, subject to the following upper ceilings per tour:

Area/Sector	No. of eligible visits	Maximum financial upper ceiling per tour
Focus LAC	1	Rs.2,50,000
Focus Africa (inclusive of WANA countries)	1	Rs.2,00,000
Focus CIS	1	Rs.2,00,000
Focus ASEAN + 2	1	Rs.2,00,000
General Areas	1	Rs.1,50,000
Total	5 eligible visits	General Areas

Participation by individual exporters in the events mentioned above are subject to certain conditions which are as follows:

For participation in EPCs led events, only air-expenses (economy excursion) of up to Rs.70,000 is allowable. It is Rs.1,00,000 for Focus LAC. Reimbursements will depend on above-specified ceilings.
The number of participants permitted to participate in one financial year is five, maximum.
Only one regular employee or director or proprietor of the exporting company will be eligible for assistance. The scheme, however, is not applicable for non-Indian citizens.
The exporting company must apply for assistance in the involved EPC with a minimum of 14 days clear advance notice. The notice should not include the date of receiving the application and date of departure from the country.
Companies charged under the Foreign Trade Policy of India or any export law are ineligible to receive assistance.
Exporting companies who are members of any EPC are also eligible for assistance under the scheme. Their application must route through the involved EPC.
A maximum of three participants in a specific event would be eligible for MDA assistance. After receiving it three times for past events, they will have to participate in that event through their finances.
Maximum assistance also includes MDA assistance received from all Government bodies, Export Development Authorities, ITPO etc.

Documents required for reimbursement of assistance

Application in Annexure-IV must be submitted physically and electronically by the exporting company to the involved EPC after filing and signing. It must also give 14 days clear advance notice.
On receiving the application, the involved organisation must furnish an acknowledgement receipt. Subsequently, they must send an approval letter in Annexure-V to the exporting company within five days of receiving the application for the same.
Claim form and declaration in Annexure-VI duly filled, along with the certificate in Annexure-VII duly signed by the Chartered Accountant must be submitted to the involved organisation along with the below-mentioned paperwork after they return to India within forty-five days:
- Particulars of activity performed earlier with MDA assistance to the same territory(s).
- A readable copy of passport with details of the entries and departure. Documentary evidence such as hotel bills, boarding pass, lodging pass, etc. if the information described is not mentioned.
- Original air ticket or readable photocopy of the same along with a certificate from the concerned airline specifying details such as traveller name, ticket number, countries visited, flight number, date of departure, economy excursion class fare, etc.
- Self-certified f.o.b. value export figures during the previous three financial years.
- A thorough report about the activity in which it participated and achievements made.

Marketing Access Initiative scheme for the export benefit

Marketing Access Initiative scheme for export benefit is one of the export promotion schemes provided to all the exporters in India. Based on the focus-product focus-country approach, it aims at transforming specific markets by conducting market research.

Activities covered under MAI scheme

MAI scheme covers several activities for financial assistance which are as follows:

Market projects abroad

Launch of showrooms.
Launch of warehouses.
Trade Festival of India.
Exhibitions in international stores.
Product establishment.
Marketing and campaigning.
Assistance to organisations in clusters for marketing abroad.
Publications of catalogues.
Participation in international trade fairs at a national status.
Attracting customers from focused countries.

Capacity building

Training exporters.
Up-gradation in facilities and products.
Setting up common design areas and centres for facilities.
Appointing experts in consumer countries.

Assistance for statutory compliance

Payments arising out of legal obligations.
Legal dispute occurring abroad concerning the commodities, other services etc.

Research purposes and project management

Market analysis (country-specific).
Study of WTO rules and other conventions such as Free Trade Agreement (FTAs) etc.
Creating projects that bring significant growth and enhancements to the market.

Eligible agencies

Under the Scheme, financial assistance is allowable to the following:

Central Government departments.
Central and State Governments’ organisations.
Export Promotion Councils.
Registered Trade Promotion Organisation.
Commodity Boards.
Apex Trade Bodies recognised under Foreign Trade Policy of Government of India.
Recognised Artisan Clusters.
Individual Exporters (for statutory compliance).
National Level Institutions such as the National Institute of Designs (NIDs), other Universities, recognised laboratories, etc.

Support from GJEPC to the exporters of gems and jewellery

Apart from the schemes mentioned above, GJEPC provides support to exporters of gems and jewellery by arranging several events which are as follows:-

Buyer seller meets

Commodity Boards and EPCs organise buyer-seller meets and such events allow exporting companies to connect with the buyers directly. Communication about products, their pricing and sales provides clarity and promotes the brand.

Trade delegations

Conducting trade delegations helps in developing economic relations between the countries and increases the number of customers in the overseas market.

Seminars

Commodity boards and promotion councils organise many seminars every year where the latest knowledge about the sector and other trends and changes are topics for discussion.

Workshops

These workshops train the exporters to compete with their rivals in the international arena.

International fairs

Eligible exporters get a chance to take part in international fairs through the involved EPCs and commodity boards. Here, exporters interact with other exporters and customers, interchange samples, discuss prices, etc.

Visa recommendations

Exporters have to keep making visits to foreign countries to sell their products. EPCs provide help in making visa arrangements for the same. The process under the council becomes less time-consuming.

Update on the latest developments

EPCs and associated boards provide exporters with all the happenings in the industry. Information regarding threats and overseas trends helps exporters to improve their performance.

Education and training initiatives

EPCs organise free of cost education and training classes for exporters. These sessions help in creating policies that increase sales and thereby increase profits.

Awards for export excellence

Related authorities conduct award ceremonies, honouring talented exporting for their performance and encouraging others to do better.

Research and development

Frequently conducted market research and surveys update exporters about all the changes and help them explore various possibilities.

The benefits extended by GJEPC to exporters of gems

GJEPC has worked continuously for making a positive difference in the lives of all the exporters. Mentioned below are some initiatives that exporters of gems can benefit from:

Swasthya Ratna

Launched by GJEPC, Swasthya Ratna aims at providing quality medical insurance packages to the workers and their family members. GJEPC has tied up with Edelweiss Gallagher Insurance Brokers Ltd. to create affordable and different options for workers to choose from, based on the number of members, other benefits, etc. The scheme also includes maternity coverage and pre-existing diseases.

Swasthya Kosh

Swasthya Kosh is a healthcare fund created by GJEPC. Through this fund, GJEPC accepts donations from people residing in India and abroad. The amount collected goes into paying for healthcare insurance on behalf of the workers.

Parichay card

Parichay card is an initiative introduced by GJEPC to track workers and create a fund large enough to cover all of them and their families. This card is an identity proof of workers and will enable them to avail of various benefits. It creates a database of information about workers and based on that, provides social security, job opportunities, access to banks and government benefits, etc.

Common facilities centre

Lack of access to advanced technology has been a setback for workers in rural areas. It limits their ability to create. GJEPC has launched common facilities centres (CFCs) to enable workers to make use of technological equipment at affordable prices. It is especially beneficial for MSME sectors of the industry.

Promotional activities

GJEPC also organises other activities for increasing the exports of products made by gems and jewellery makers. Such activities include trade shows held several times over the years, like India International Jewellery Show (IIJS), India Gem & Jewellery Machinery Expo (IGJME), etc. These shows attract customers from the country and overseas. GJEPC also organises the participation of workers at various international fairs JCK Las Vegas, Basel, etc.

The benefits extended by GJEPC to exporters of jewellery

Schemes of Swasthya Ratna, Swasthya Kosh, Common Facilities Centres, Parichay Card and promotional activities are also available for exporters of jewellery. Apart from these, there are some other benefits that jewellery exporters can use to their advantage. They are as follows:

Jewellery park

Jewellery park is a project that GJEPC will launch in the state of Maharashtra. GJEPC seeks to increase investment and employment by establishing and launching such initiatives. It will give jewellery traders and manufacturers a chance to expand their work in Mumbai. Jewellery parks in China, Hong Kong, etc. will be standard for jewellery parks in India.

Artisan awards

Organised every year by GJEPC, the Artisan awards is a platform to celebrate and honour talented jewellers.

The Aatman

It is a publication that seeks to guide the jewellers by incorporating the ideas of all human generations. It assists in designing jewellery as well as setting up businesses. Topics of discussion include brand identity, storytelling, curating and merchandising, etc.

Design inspiration

Design inspiration is an initiative launched by GJEPC. It tutors the jewellers, designers and students on the latest trends in the market. It teaches them how to cultivate their ideas and emotions into beautiful jewellery.

Eligibility criteria for exporters of gems and jewellery to claim benefits from GJEPC

To avail the schemes and services provided by GJEPC, exporters need to register themselves for its membership. Eligibility criteria for the same are as follows:

Manufacturer exporter

A manufacturer exporter is an exporter who himself purchases goods for selling them. They need to furnish the following documents while applying for the membership:

Permanent Account Number (PAN) card;
Import-export code issued by appropriate licensing authorities;
Self-attested GST proof;
Partnership deeds (in case of a partnership);
Memorandum and Articles of Association;
Registration certificate;
Online generated signature paper signed by the owner, a partner, investor (as per) and verified by the world-class bank.

Merchant exporter

A merchant exporter is an exporter who buys the raw materials, manufactures and sells the finished products. Documents that merchant exporters need to submit while applying for the membership are the same as that of a manufacturer exporter. But along with that, they need to submit a Chartered Accountant’s certificate mentioning their turnover in the past two years.

Conclusion

With all the opportunities and schemes generated by GJEPC, the gems and jewellery industry in India is expanding beyond the borders at a fast pace. Their spectacular products are in high demand, contributing 29% to the global economy. Expectations are the industry will produce an employment rate of at least 8.23 million employees by 2022. Its future indeed looks sweet and favourable.

References

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