Government of India gave Authorized Economic Operator (AEO) status to gems and jewelery sector.

Indian Gems and Jewellery Sector Granted Authorized Economic Operator (AEO) Status

Introduction to the AEO Status for the Gems and Jewellery Sector

The Gems and Jewellery Export Promotion Council (GJEPC) has achieved a significant milestone as the Government of India has granted Authorized Economic Operator (AEO) status to the gems and jewellery sector. The AEO program, introduced as a pilot project in 2011, is designed to facilitate smoother export-import procedures and improve the ease of doing business. This move is expected to have a positive impact on the gems and jewellery industry's global competitiveness.

Government of India gave Authorized Economic Operator (AEO) status to gems and jewelery sector.

Benefits of AEO Status for the Gems and Jewellery Industry

The AEO status brings several benefits to the gems and jewellery sector, including:

• Simplified Export-Import Procedures: The AEO status streamlines customs processes, allowing for faster cargo release times.
• Reduced Bank Guarantees: The required bank guarantees for customs-related activities are reduced by 50%, lowering costs for businesses.
• Improved Supply Chain Security: The program enhances supply chain security and strengthens international trade operations.

By granting AEO status to the gems and jewellery sector, the Indian government is acknowledging the industry's importance and aiming to make it easier for businesses to operate within the global trade framework.

Efforts by GJEPC to Achieve AEO Status

Initially excluded from the AEO program, the GJEPC's persistent engagement with relevant government ministries played a crucial role in advocating for the inclusion of the gems and jewellery industry. The Finance Ministry has now extended eligibility for AEO participation to sector units, allowing them to benefit from the program's advantages.

To promote awareness and encourage participation in the AEO program, GJEPC organized an informational outreach event on March 18, 2024. This event provided stakeholders with insights into the benefits of obtaining AEO status and generated significant interest among industry participants.

Companies Granted AEO Status

Following the GJEPC's advocacy efforts, 20 companies applied for AEO status in the gems and jewellery sector. Among them, Asian Star, a leading diamond and diamond jewellery manufacturer, became the first company in the Indian gems and jewellery industry to receive AEO certification. This achievement demonstrates the growing acceptance and recognition of the AEO program within the sector.

Context and Industry Outlook

The inclusion of the gems and jewellery industry under the AEO program comes at a time when exports in the sector have experienced a decline. In the last fiscal year, gems and jewellery exports decreased by 14 percent to $32.28 billion, compared to $37.74 billion in the same period the previous year. This decline was largely due to weakened demand. The AEO status is expected to provide a boost to the industry, fostering a more conducive environment for export and trade.

Conclusion

The Government of India's decision to grant AEO status to the gems and jewellery sector is a positive development for the industry. The simplified procedures, reduced costs, and improved supply chain security offered by the AEO program are likely to enhance the sector's global competitiveness. As more companies gain AEO certification, the Indian gems and jewellery industry is poised for growth and increased participation in international trade.