The All India Gem and Jewellery Domestic Council (GJC) also demanded immediate implementation of a comprehensive integrated gold policy to save the jobs of the 55 lakh-strong labour force engaged in the business, the loss of which would also impact the dependents and families.
"The import duty should immediately be reduced from 12.5 per cent to the old level of 10 per cent. The increase has been a steep 25 per cent. Added to that there is three per cent GST on jewellery. As it is an expensive product, the total impact has been on the value," GJC vice-chairman Shankar Sen said here.
"The perception now is gold is very expensive, out of reach. In the international market, gold prices have gone up by 20 percent. So total increase in prices has been a whopping 45 per cent. This has led to the gold demand hitting a very low ebb," he said.
Providing statistics, he said that 78 tonnes of gold were imported in July last year, which figure has come down to 30 tonnes in July 2019, "of which 22 tonnes were re-exported. So only eight tonnes went for domestic consumption".
"The lack of demand in gems and jewellery has resulted in many self-employed craftsmen and artisans in the unorganised section losing jobs and shifting to other businesses. And there have been several reports of sector workers committing suicide," Sen said.
"There were "25-28 per cent visible job losses in the last one and a half months among self-employed craftsmen and artisans", he said.
Ninety per cent of the gold and jewellery industry in India comprises of small units. Organised factories make up only 10 per cent of the sector.
According to Sen, "the organised factories are involved in the exports. There, the situation has still not come to a stage where there will be job losses. But number of shifts are being reduced".
He said that even in 2002 and 2008 during the recession caused by the dot com crash and the US financial crisis, the gold industry had not been impacted.
"In fact there was a great demand to buy gold. But the scenario is completely different this time," he said.
"So, the industry badly needs the 2.5 per cent import duty cut back immediately, and then 2 per cent cut yearly, to bring it down to 4 per cent over the next four years", he addeed.
Sen also called for immediate implementation of a revamped Gold Monetization Scheme to make it more effective.
The GJC also stressed the need for a comprehensive gold policy covering various aspects of the gems and jewellery industry, including raising the threshold for mentioning PAN card details in purchase invoices from the current Rs 2 lakh to Rs five lakh.
( With inputs from IANS )