Save lone diamond factory from extinction, urge artisans*****
Sunday, 8 May 2011
Badrul Ahsan
Country's lone diamond cutting, polishing and jewellery manufacturing factory is facing crisis due to apathy of the government to rationalize tariffs on import of rough diamonds and to provide incentives against exports, industry sources said. Due to absence of cash incentives, irrational tariffs and lack of any support from the government, they said, it could snuff out huge prospects of the sector and also can destroy the means of livelihood of the people who are engaged in the manufacturing process. Country's foreign exchange earnings against the export of cut and polished diamonds has been increasing significantly and has already reached about $1.0 million in the last fiscal year (2009-2010). According to the company sources, the country has exported worth $0.3m in 2007, $0.5m in 2008, $0.7m in 2009 and $0.98m in 2010 where as India has earned US$ 48 billion from the diamond & diamond jewellery sectors last year. "The sector has a bright prospect of export worth $1.0 billion within next three years if the government provides us all types of facilities," Onu Jaigirdar, Managing Director of Brilliant Hera Ltd said. At present, the local manufacturers have to pay a total of 95.81% in duties to import rough diamonds, whereas the importers of finished diamonds and diamond jewellery are avoiding payment of any duties by using the existing 'baggage rules' to sidestep such payments. In addition to this, the manufacturers also have to pay 37.5% tax on the foreign trainers' salary who train-up the local workers. "Today we are facing serious financial setbacks as training costs are weighing heavily on company's profitability. If government does not declare any incentives and rationalise tariffs we will have no choice but to close down the factory," Jaigirdar said. Jaigirdar also said that national support to the sector would help diamond industry flourish as a major export sector. "Bangladesh diamond cutting and polishing industry has been declared as 'thrust sector' in the 2009-2010 export policy order, but the government is yet to provide any kind of support to the sector," sources said. India has been leading the sector for long. It has been exporting about ninety two per cent of the world's total demand of polished diamond and diamond jewellery. China, Thailand, Sri Lanka, Vietnam and Botswana are in a mad race to capture the export market of diamond. Those governments have provided incentives to their manufacturers to capture a market share from India; this is something our government could do easily without any loss to the exchequer, Jahangir added.
Country's lone diamond cutting, polishing and jewellery manufacturing factory is facing crisis due to apathy of the government to rationalize tariffs on import of rough diamonds and to provide incentives against exports, industry sources said. Due to absence of cash incentives, irrational tariffs and lack of any support from the government, they said, it could snuff out huge prospects of the sector and also can destroy the means of livelihood of the people who are engaged in the manufacturing process. Country's foreign exchange earnings against the export of cut and polished diamonds has been increasing significantly and has already reached about $1.0 million in the last fiscal year (2009-2010). According to the company sources, the country has exported worth $0.3m in 2007, $0.5m in 2008, $0.7m in 2009 and $0.98m in 2010 where as India has earned US$ 48 billion from the diamond & diamond jewellery sectors last year. "The sector has a bright prospect of export worth $1.0 billion within next three years if the government provides us all types of facilities," Onu Jaigirdar, Managing Director of Brilliant Hera Ltd said. At present, the local manufacturers have to pay a total of 95.81% in duties to import rough diamonds, whereas the importers of finished diamonds and diamond jewellery are avoiding payment of any duties by using the existing 'baggage rules' to sidestep such payments. In addition to this, the manufacturers also have to pay 37.5% tax on the foreign trainers' salary who train-up the local workers. "Today we are facing serious financial setbacks as training costs are weighing heavily on company's profitability. If government does not declare any incentives and rationalise tariffs we will have no choice but to close down the factory," Jaigirdar said. Jaigirdar also said that national support to the sector would help diamond industry flourish as a major export sector. "Bangladesh diamond cutting and polishing industry has been declared as 'thrust sector' in the 2009-2010 export policy order, but the government is yet to provide any kind of support to the sector," sources said. India has been leading the sector for long. It has been exporting about ninety two per cent of the world's total demand of polished diamond and diamond jewellery. China, Thailand, Sri Lanka, Vietnam and Botswana are in a mad race to capture the export market of diamond. Those governments have provided incentives to their manufacturers to capture a market share from India; this is something our government could do easily without any loss to the exchequer, Jahangir added.