India's budgetary proposal to raise the limit on duty-free gold ornaments that can be carried back to the country by NRIs is set to boost jewellery sales in Oman and other countries in the Gulf region, says a media report.
Leading retailers with presence across the Gulf Cooperation Council (GCC) countries have indicated that since the budget 2013 announcement, NRIs who are planning to travel to India in the coming days started buying more gold ornaments, a report in daily 'Times of Oman' said.
As part of the Budget proposal last week, it was announced that male passengers can carry gold worth Rs 50,000, and female passengers Rs 1 lakh compared to the earlier limit of Rs 10,000 and Rs 20,000, respectively.
"Now, NRIs have a better confidence. All our four outlets in Oman have witnessed better sales on Thursday, probably 25 per cent higher than a normal Thursday.
"Since it was the first day, people are gradually realising the liberal policy of Indian government. We expect more sales in the coming days, when more and more NRIs get to know about it," Najeeb K, Regional Head of Malabar Gold, was quoted as saying by the report.
He said that since India levies almost 7 per cent duty (6 per cent import duty and one per cent value added tax) on gold, NRIs who take gold ornaments with them can easily get this benefit when they sell the yellow metal back home.
Jose Kakkassery Francis, Regional Manager of Joy Alukkas, said in the report that the company's outlets posted a 30 per cent growth in sales on the Budget day, as compared to the same day of previous week.
He, however, said that the rush was partly due to an ongoing exchange offer for 22 carat gold ornaments.
Najeeb of Malabar Gold said that the previous limits were fixed almost 40 years ago, sometime in 1970. The government, he said, could have increased it more in view of the phenomenal growth in gold prices in the international market.
Gold imports of India – the biggest user of yellow metal in the world – fell to 860 tonnes last year from an all-time high of 969 tonnes in 2011, the report said.
Meanwhile, Sharjah-based Indian Business & Professional Council in a statement welcomed the move and said: "This (the move) is the result of hardcore mission of IBPC - Sharjah