The claim of the jeweler is that the gold imported by the commercial bank can only be bought on the recommendation of the Nepal Gold and Silver Traders Federation, the Gems and Jewelery Federation, the Handicraft Federation and the Nepal Art Traders Association.
After the distortion in the gold quota and recommendation system, homework has been started to open the import on the basis of sales. Gold imported by commercial banks can only be bought by jewelers on the recommendation of the Nepal Gold and Silver Traders Federation, the Gems and Jewelery Federation, the Handicrafts Federation and the Nepal Art Traders Association.
After the quota and recommendation practices have been making money in the Union and distortions have flourished, the businessmen have been demanding to open up gold import on the basis of sales. Businessmen request to amend the Gold Import and Sale and Distribution Procedure 2068 and make it up-to-date. Based on the demands of the businessmen, the committee has been formed with representation from Ministry of Commerce and Supply, Finance, National Bank, Bankers Association, Federation of Nepal Industry and Commerce. The
committee has proceeded with the discussion on gold import quota, recommendation system and opening of import based on sales basis. "There has been a lot of bullying in gold distribution. In order to manage it, there has been a proposal that the import quota should be abolished and imports should be made on the basis of transactions. A discussion has also been held on the proposal," said a member of the committee, "but Rashtra Bank is not so positive about it. Rashtra Bank has a question about what to do when the condition of foreign exchange reserves is not good. We are focusing on this issue.'
According to the National Bank, the foreign exchange reserves have been continuously setting new records for the past 29 months. In just 6 months, foreign exchange reserves have increased by 2 trillion 75 billion 64 crore rupees. Along with this, the country's total foreign exchange reserves have reached 23 trillion 16 billion 84 billion as of last December.
'Since the current situation is strong, it was said that along with banks, businessmen should also be opened on the basis of transactions,' said the member, 'Rashtra Bank's argument is what to do when the reserves are reduced. There will be some decision on this matter by February 15.'
To discourage gold import and investment, the National Bank has been arranging the import and distribution of gold in quota system. Commercial banks are allowed to import only 20 kg of gold per day. Even businessmen can buy only 20 kilos a day. But jewelers cannot buy gold directly from banks. According to gold import and sale distribution procedure 2068, 50 percent of the daily quota (10 kg of gold out of 20 kg) quota has been allocated for Bagmati zone of the past.
The Nepal Gold and Silver Traders Federation can also recommend 50 percent of the quota allocated in the Bagmati region. The remaining 50 percent can be bought by bankers only with the recommendation of 3 organizations (Gems and Jewelery Federation, Handicrafts Federation, Nepal Arts and Craftsmen Association).
50 percent quota (10 kg based on 20 kg daily) has been allocated for the 13 zones of the former. Out of this, the gold and silver business federation has 65 percent, gem and jewelery business federation 25 percent, Nepal art business association 7.5 percent and handicraft federation 2.5 percent.
Now the zone has been cancelled. According to the previous system, there was a distortion when recommendations had to be made from local organizations. Recommendations were started in consultation, priority was given to our own people," said Tejaratna Shakya, advisor of the Nepal Gold and Silver Traders Federation, "In the past, it was customary to charge a fee of 1,000 rupees per kilo for making recommendations. Now I have to pay a fee of Rs 6,000. That's why it is necessary to review this matter.'
15 days after importation, recommendation of General Assembly is not required. Banks can sell directly to jewelers. Banks can only sell gold to dealers with PAN/VAT number. The Ministry of Commerce had asked for suggestions for the amendment. It is said that suggestions have already been made on behalf of jewelers. "Data was requested from businessmen about the demand and consumption of gold, the federation has already provided the data requested by the committee," said an official.
According to that official, gold cannot be bought on public holidays when the bank only imports. Businessmen argue that it is necessary to open that reason. The recommendation system has brought distortion in the jewelry market. When the customs rates of India and Nepal are the same, gold does not go to India,' said a jeweler, 'Based on the business and sales, the businessmen should get import facilities accordingly after submitting the bill to the National Bank.' According to experts, smuggled gold entered Nepal after the price of 18,000 to 20,000 rupees per tola in Nepal compared to India. In the budget of fiscal year 2081/82, the customs rate in Nepal was increased from 5 percent to 20 percent. But the Indian government reduced the customs rate from 15 percent to 6 percent last July.
Although 3 and a half percent GST was imposed in India, the customs rate between Nepal and India was 50 percent different. This is the reason why gold became more expensive in Nepal compared to India. And, because of the open border, illegal business is encouraged, businessmen say. Lately, the government of Nepal has also maintained the customs rate from 20 percent to 10 percent. Businessmen claim that this has discouraged smuggling. But experts say that there is a question about the quality of jewelry.
