The gems and jewellery industry, which contributes 7 per cent to the GDP, has come to a complete standstill and the demand is expected to fall by 30 per cent mainly driven by the nationwide lockdown imposed to curtail the spread of new coronavirus, according to an industry body.\
The jewellery industry is predominantly wedding driven, however, due to coronavirus such events have been cancelled and wedding shopping has come to a halt, the Indian Chamber of Commerce said in a statement here.
In spite of the gold demand predicted to be in the range of 700-800 tonne in 2020, the volatility of prices had severely impacted demand before the coronavirus outbreak, it added. \
India's average long-term gold demand is around 850 tonnes because of its affinity to gold due to economic and social requirements. \ \
Now purchases are estimated to plummet 30 per cent in 2020 from the 690 tonnes last year, according to reports, with the economic impact of the virus expected to be negative on employment and income.\ \
The economic situation of the gems and jewellery industry, which employs over five million people, has taken a severe beating but the most affected are the daily wage workers who became jobless due to the shutdown.\ \
Over and above, the sector has a lot of compliance issues like advance tax payment, maturity date of Gold Metal Loan, interest payment on gold metal loan among others. \ \
In light of such a crisis situation, the chamber has urged the government for relief measures for the industry including at least 180 Days for advance tax payment and roll over of gold metal loans at lower interest rates. \ \
The ICC asked the government to allow a 50 per cent reduction on interest rates for term loans and working capital facilities for a span of 180 days instead of 90 days in support of all businesses and also change the definition of Non-Performing Assets to 180 days for the short term.\ \
The chamber strongly requests the government to create a special fund and distribute one time funding to the craftsmen and artisans who are without a job and who have registered their details through PAHCHAN Cards, the ICC added.
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