Diamond import payment rule liberalised

Based on the recommendations of the Gems and Jewellery Export Promotion Council (GJEPC) Reserve Bank of India (RBI) has allowed import of rough diamonds from five mining companies of rough diamonds in respect of which advance payments without bank guarantee, could be permitted.
These companies are Rio Tinto, UK; BHP Billiton, Australia; Endiama EP, Angola; Alrosa, Russia; Gokharan, Russia, in addition to the Diamond Trading Company, UK.
However, while allowing the advance remittance, AD Category - I banks may ensure that the importer should be a recognised processor of rough diamonds as per a list to be approved by GJEPC in this regard and should have a good track record of export realisation.
Also AD Category - I banks should undertake the transaction based on their commercial judgment and after being satisfied about the bonafides of the transaction.

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, that is, to the ultimate beneficiary and not through numbered accounts or otherwise.

Further, due caution may be exercised to ensure that remittance is not permitted for import of conflict diamonds, said RBI.

The expert committee on the gems and jewellery sector, constituted by the ministry of finance has recommended that a more liberal approach may be adopted on advance payment for import of rough diamonds.