Bharat Diamond Bourse gets special notified zone

 Bharat Diamond Bourse gets special notified zoneThe government has reportedly notified precious cargo customs clearance centre, a part of Bharat Diamond Bourse (BDB) at Bandra Kurla Complex, Mumbai as “special notified zone” (SNZ) for the trading of rough diamonds.

The SNZ is meant for import, trading and re-export of rough diamonds. Besides, a regulatory framework has been prepared by the Ministry of Finance in consultation with the Directorate General of Foreign Trade (DGFT), the Reserve Bank of India (RBI) and the industry. The notified zone will have facility for viewing, auction and sale of rough diamonds, and shall include all necessary, commercial, security and customs related facility, adds a report. This proposal to notify BDB as a special notified zone for trading of rough diamonds follows the decision of the government to permit trading of rough diamonds by leading diamond-mining companies of the world in India.

As per the framework, BDB proposes to outsource the handling of rough diamonds imported for auctions/sales, to a special purpose vehicle, namely India Diamond Trading Centre, jointly constituted by the Gems and Jewellery Export Promotion Council (GJEPC) and BDB.

Besides, the list of companies will have to get permission from the RBI to avail facility of this special notified zone and the import of rough diamonds will be permitted through air cargo route only and not by hand carriage or express courier mode.

The rough diamonds to be placed for viewing, auctions or sale will be accompanied by a declaration of value through an invoice, packing list, documents of insurance and Kimberley Process Certificate. While traders will get accessibility to the special notified zone, the GJEPC will formulate the eligibility criteria, photo identification card.

In 2014, the Reserve Bank had relaxed the norms for trading of rough diamonds by allowing importers of rough diamond to send advance remittances to any company apart from the nine notified mining companies.

Thus, RBI stopped the process of notifying the names of overseas mining companies from whom an importer may import rough diamonds into India. In turn it is left to the best commercial judgement of the banks and industry.

The RBI had in 2007 notified the names of five mining companies to whom an importer, other than a state-run entity, was allowed to make advance remittance without any limit and without bank guarantee or stand by letter of credit for import of rough diamonds. The list had since been increased to nine and has now been relaxed completely, subject to certain conditions like the advance payments should be made strictly as per the terms of the sale contract and should be made directly to the account of the company concerned among others, adds a report.

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