MANU/PIBU/0226/2023

Department/Board : Press Information Bureau

Date : 01.02.2023

Union Budget to give a boost to exports and manufacturing

In a major push to LGD (lab grown diamonds) manufacturing, duty on LGD seeds reduced from 5% to 0%; research grant of Rs. 242 crore to IIT Madras approved

Custom duty on imitation jewellery enhanced from 20% to 25%; move to discourage cheap imports from China and encourage domestic manufacturing

Import duty of fish meal reduced from 15% to 5%; move will make shrimp industry more competitive

Measures to enhance business activities in GIFT IFSC will promote India's financial services exports

30 International Skill India Centres to help in growth of services exports

Union Budget 2023-24 has a slew of measures to give boost to exports and help accelerated growth of manufacturing in the country. The indirect tax simplification and rationalization has a clear export-oriented focus. Following are highlights for export and manufacturing Sector:

The Department of Commerce's recommendation on lab grown diamond (LGD) has been accepted whereby the research grant of Rs. 242 crore over a period of 5 years to IIT Madras has been approved. This will enable indigenization of the manufacturing process of LGD. Further, reduction of duty on LGD seeds from 5% to 0% has also been accepted which will result in reducing the cost of production of LGD growers and make our LGD exports globally competitive. The recommendation of the Department of Commerce for creating separate HS Codes for LGD has also been accepted. It would enable tracking the international trade in lab grown diamonds.

Custom duty on articles of precious metals such as gold, silver and platinum has been increased from 20% to 25% thereby increasing the duty differential to 10% over gold/silver/platinum bars. This will boost domestic manufacturing in the sector and result in import substitution. Custom duty on imitation jewellery has been enhanced from 20% to 25%. This will discourage cheap imports from China and encourage domestic manufacturing.

The reduction in import duty of fish meal from 15% to 5% will make the shrimp industry more competitive in the country and boost exports. The fish meal constitutes 40% of the cost of production of shrimps. This will also prevent incidence of juvenile fishing which is used for fish meal in domestic production and will thereby improve our marine fish stock availability.