Latest news with #GemandJewelleryExportPromotionCouncil
Fashion Network
2 hours ago
- Business
- Fashion Network
Trump's 50% levy is forcing Indian banks to scrutinise exporters
Indian banks are increasing scrutiny of new loan applications from exporters by asking about exposure to the US market and contingency plans for coping with US President Donald Trump 's steep tariffs, according to people familiar with the matter. Bloomberg News spoke to officials at five large Indian lenders who said they're assessing the financial ramifications of the punitive levies on their clients, especially those in the export-dependent textile, gem and jewellery sectors. They all spoke on the condition of anonymity, as the information is not public. Lenders are asking borrowers more pointed questions when vetting new export financing proposals or renewals of such funding, the people said. They added that some export orders are being put on hold while trade negotiations play out between New Delhi and Washington. The move comes after Trump doubled tariffs on India-made items in the space of a week, with the additional levy effective by Aug. 27, bringing the cumulative tariff to 50%. Businesses worry that this will severely disrupt shipments to the US by making Indian exports prohibitively expensive. The industries hit hardest — they are also among the most labour-intensive — have asked the Narendra Modi-led government to introduce measures to reduce the pain from the new trade barriers. Indian lenders are concerned the trade war will create new balance sheet stress and stoke painful memories of the country's distressed debt problem a few years back. Some of their key queries, according to the people, pertain to cash flows, business continuity plans and burden-sharing efforts with other stakeholders such as distributors. Some banks have begun to identify the most vulnerable clients internally by checking on financial parameters such as the percentage of revenue coming from the US, said two people Bloomberg News spoke to. The exposure to the highest-risk borrowers due to US levies isn't currently that worrisome, they added. Most of the exporters these bankers have spoken to about the trade issue said they're hopeful for a partial rollback of the US tariffs. Indian exporters have already started redrawing strategies to deal with the unexpected levies through measures such as expanding in other markets, shifting output from India to elsewhere and exploring acquisitions in the US. Some cash-rich exporters can sustain losses for a year or two but they worry about longer-term loss of business to rivals in Bangladesh and Pakistan, a person said. These neighbouring nations face lower US levies than India. India's Commerce Minister Piyush Goyal told Parliament late last month that the federal government is engaging with exporters to assess the impact of tariffs and will take 'all necessary steps to secure and advance our national interest.' The Gem and Jewellery Export Promotion Council is seeking support such as finance relief and duty drawbacks. Other requests include deferment of interest on working capital facilities by six months, 90-day pre-shipment and penalty-free loan payment extensions and a freeze on downward revisions of credit ratings, Kirit Bhansali, the trade group's chairman, said in an August 7 statement. Rating companies haven't taken any action yet on exporters' creditworthiness. However, borrowing companies are worried and seeking government assistance to prevent any slip in ratings that will spike the cost of funding. Other Indian business representatives want to see more liquidity in the banking system to offset damage from the US tariffs. India's government should push 'banks to lower the rate of interest' to keep businesses afloat, said Rahul Mehta, director at Mumbai-based Creative Garments Pvt. Removal of import duties on raw materials should also help, Mehta said, calling for a government response akin to Covid-era emergency policies.
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Business Standard
4 hours ago
- Business
- Business Standard
Trump's 50% tariffs forcing Indian banks to scrutinise exporters' loans
Lenders are asking borrowers more pointed questions when vetting new export financing proposals or renewals of such funding Bloomberg By Saikat Das, Satviki Sanjay and Siddhi Nayak Indian banks are increasing scrutiny of new loan applications from exporters by asking about exposure to the American market and contingency plans for coping with US President Donald Trump's steep tariffs, according to people familiar with the matter. Bloomberg News spoke to officials at five large Indian lenders who said they're assessing the financial ramifications of the punitive levies on their clients, especially those in the export-dependent textile, gem and jewelery sectors. They all spoke on the condition of anonymity, as the information is not public. The move comes after Trump doubled tariffs on India-made items in the space of a week, with the additional levy effective by Aug. 27, bringing the cumulative tariff to 50 per cent. Businesses worry that this will severely disrupt shipments to the US by making Indian exports prohibitively expensive. The industries hit hardest — they are also among the most labor-intensive — have asked the Narendra Modi-led government to introduce measures to reduce the pain from the new trade barriers. Indian lenders are concerned the trade war will create new balance sheet stress and stoke painful memories of the country's distressed debt problem a few years back. Some of their key queries, according to the people, pertain to cash flows, business continuity plans and burden-sharing efforts with other stakeholders such as distributors. Most of the exporters these bankers have spoken to about the trade issue said they're hopeful for a partial rollback of the US tariffs. Indian exporters have already started redrawing strategies to deal with the unexpected levies through measures such as expanding in other markets, shifting output from India to elsewhere and exploring acquisitions in the US. Some cash-rich exporters can sustain losses for a year or two but they worry about longer-term loss of business to rivals in Bangladesh and Pakistan, a person said. These neighboring nations face lower US levies than India. India's Commerce Minister Piyush Goyal told Parliament late last month that the federal government is engaging with exporters to assess the impact of tariffs and will take 'all necessary steps to secure and advance our national interest.' The Gem and Jewellery Export Promotion Council is seeking support such as finance relief and duty drawbacks. Other requests include deferment of interest on working capital facilities by six months, 90-day pre-shipment and penalty-free loan payment extensions and a freeze on downward revisions of credit ratings, Kirit Bhansali, the trade group's chairman, said in an Aug. 7 statement. Rating actions Rating companies haven't taken any action yet on exporters' creditworthiness. However, borrowing companies are worried and seeking government assistance to prevent any slip in ratings that will spike the cost of funding. Other Indian business representatives want to see more liquidity in the banking system to offset damage from the US tariffs. India's government should push 'banks to lower the rate of interest' to keep businesses afloat, said Rahul Mehta, director at Mumbai-based Creative Garments Pvt.
Business Times
6 hours ago
- Business
- Business Times
Trump's 50% levy is forcing Indian banks to scrutinise exporters
Indian banks are increasing scrutiny of new loan applications from exporters by asking about exposure to the American market and contingency plans for coping with US President Donald Trump's steep tariffs, according to people familiar with the matter. Bloomberg News spoke to officials at five large Indian lenders who said they're assessing the financial ramifications of the punitive levies on their clients, especially those in the export-dependent textile, gem and jewellery sectors. They all spoke on the condition of anonymity, as the information is not public. Lenders are asking borrowers more pointed questions when vetting new export financing proposals or renewals of such funding, the people said. They added that some export orders are being put on hold while trade negotiations play out between New Delhi and Washington. The move comes after Trump doubled tariffs on India-made items in the space of a week, with the additional levy effective by Aug 27, bringing the cumulative tariff to 50 per cent. Businesses worry that this will severely disrupt shipments to the US by making Indian exports prohibitively expensive. The industries hit hardest – they are also among the most labour-intensive – have asked the Narendra Modi-led government to introduce measures to reduce the pain from the new trade barriers. Indian lenders are concerned the trade war will create new balance sheet stress and stoke painful memories of the country's distressed debt problem a few years back. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Some of their key queries, according to the people, pertain to cash flows, business continuity plans and burden-sharing efforts with other stakeholders such as distributors. Some banks have begun to identify the most vulnerable clients internally by checking on financial parameters such as the percentage of revenue coming from the US, said two people Bloomberg News spoke to. The exposure to the highest-risk borrowers due to US levies isn't currently that worrisome, they added. Most of the exporters these bankers have spoken to about the trade issue said they're hopeful for a partial rollback of the US tariffs. Indian exporters have already started redrawing strategies to deal with the unexpected levies through measures such as expanding in other markets, shifting output from India to elsewhere and exploring acquisitions in the US. Some cash-rich exporters can sustain losses for a year or two but they worry about longer-term loss of business to rivals in Bangladesh and Pakistan, a person said. These neighbouring nations face lower US levies than India. India's Commerce Minister Piyush Goyal told parliament late last month that the federal government is engaging with exporters to assess the impact of tariffs and will take 'all necessary steps to secure and advance our national interest'. The Gem and Jewellery Export Promotion Council is seeking support such as finance relief and duty drawbacks. Other requests include deferment of interest on working capital facilities by six months, 90-day pre-shipment and penalty-free loan payment extensions and a freeze on downward revisions of credit ratings, Kirit Bhansali, the trade group's chairman, said in an Aug 7 statement. Rating companies haven't taken any action yet on exporters' creditworthiness. However, borrowing companies are worried and seeking government assistance to prevent any slip in ratings that will spike the cost of funding. Other Indian business representatives want to see more liquidity in the banking system to offset damage from the US tariffs. India's government should push 'banks to lower the rate of interest' to keep businesses afloat, said Rahul Mehta, director at Mumbai-based Creative Garments. Removal of import duties on raw materials should also help, Mehta said, calling for a government response akin to Covid-era emergency policies. BLOOMBERG
Time of India
4 days ago
- Business
- Time of India
50% tariff to affect thousands of gem and jewellery jobs
Surat: In 'extraordinarily challenging times', the Indian gem and jewellery industry is staring at an unprecedented crisis after the US's announcement of a 50% tariff on Indian goods. The 25% tariff had already come into force on Indian exports to the US. Chairman of the Gem and Jewellery Export Promotion Council (GJEPC), Kirit Bhansali, called the development deeply concerning and warned that it could have devastating consequences across India's economy, especially for the country's second-largest export sector. The US is India's largest export market for gems and jewellery, accounting for over $10 billion annually — nearly 30% of the industry's total business. The cut and polished diamond segment alone sees half its exports going to the US. The cut and polished diamond industry employs 12 lakh workers, with nine of every 10 diamonds in the world being polished in Surat. The diamond and jewellery cluster at SEEPZ SEZ in Mumbai, a major production hub employing 50,000 people, sends 85% of its output to the US. With the 50% tariff, experts fear the industry could be brought to a standstill, with ripple effects felt from diamond artisans and jewellery workers to major manufacturers. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like 15 Most Beautiful Female Athletes in the World Click Here Undo Adding to the industry's concern is the competitive disadvantage posed by lower tariffs on countries such as Turkey, Vietnam and Thailand, which enjoy tariffs of 15-20%. "This imbalance, if unaddressed, could erode India's long-standing position as a key supplier to the US. We are also concerned about the possibility of trade re-routing through low-tariff countries such as Mexico, Canada, Turkey, UAE or Oman, undermining legitimate trade and affecting transparency," said Bhansali. The domestic market is a ray of hope, as the recently concluded IIJS Premiere 2025 jewellery fair recorded projected business worth Rs 70,000 crore, underlining the sector's resilience. With India's domestic jewellery market valued at $85 billion and expected to grow to $130 billion in two years, internal demand may help cushion the blow. GJEPC has urged the govt to implement immediate relief measures. These include introducing a targeted duty drawback scheme to cover 25-50% of the new US tariff impact, financial support for market diversification, pre-shipment finance extensions, reintroduction of the interest equalization scheme and temporary deferment of interest on working capital loans. Additionally, GJEPC also wants permission for SEZ units to engage in reverse jobwork and domestic tariff area (DTA) sales to manage order cancellations and prevent layoffs. The council also requested regulatory leniency to protect credit ratings considering business disruptions. Stay updated with the latest local news from your city on Times of India (TOI). Check upcoming bank holidays , public holidays , and current gold rates and s ilver prices in your area.
Time of India
4 days ago
- Business
- Time of India
Gems and jewellery exporters' body seeks policy reforms to tackle US tariff impact
Gems and jewellery exporters ' body GJEPC on Thursday urged the government to bring in immediate policy reforms to support the industry, which is facing challenging times due to a steep 50% tariff imposed by the US on all Indian goods. The United States is the largest market for Indian gems and jewellery sector , accounting for over USD 10 billion in exports, nearly 30 per cent of the industry's total global trade , according to GJEPC (Gem and Jewellery Export Promotion Council) chairman Kirit Bhansali. Productivity Tool Zero to Hero in Microsoft Excel: Complete Excel guide By Metla Sudha Sekhar View Program Finance Introduction to Technical Analysis & Candlestick Theory By Dinesh Nagpal View Program Finance Financial Literacy i e Lets Crack the Billionaire Code By CA Rahul Gupta View Program Digital Marketing Digital Marketing Masterclass by Neil Patel By Neil Patel View Program Finance Technical Analysis Demystified- A Complete Guide to Trading By Kunal Patel View Program Productivity Tool Excel Essentials to Expert: Your Complete Guide By Study at home View Program Artificial Intelligence AI For Business Professionals Batch 2 By Ansh Mehra View Program US President Donald Trump's announcement of a sweeping 50 per cent tariff on all Indian goods is a deeply concerning development and the move will have far-reaching repercussions across India's economy, disrupting critical supply chains, stalling exports, and threatening thousands of livelihoods, he said. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like If you have a mouse, play this game for 1 minute Navy Quest Undo "The Indian gem and jewellery sector, in particular, stands to be severely impacted... A blanket tariff of this magnitude is severely devastating for the sector," Bhansali said. He further said, currently there is significant reliance on the US market, as 85 per cent of exports from SEEPZ SEZ , which provides 50,000 jobs, is directed there. Live Events For cut and polished diamonds, half of India's exports are US-bound and with the revised tariff hike, the entire industry may come to a standstill, placing immense pressure on every part of the value chain, from small karigars to large manufacturers What adds to the concern is that competing manufacturing hubs such as Turkey, Vietnam and Thailand continue to enjoy significantly lower tariffs of 15 per cent, 20 per cent and 19 per cent, respectively, making Indian products relatively less competitive in the US market, Bhansali said. "This imbalance, if unaddressed, could erode India's long-standing position as a key supplier to the US. We are also concerned about the possibility of trade rerouting through low-tariff destinations such as Mexico, Canada, Turkey, UAE, or Oman, undermining the spirit of legitimate trade and impacting transparency," he added. The GJEPC chairman said the domestic market, currently pegged at USD 85 billion, is expected to grow to Rs 130 billion in the next two years providing some relief, particularly for the diamond sector. Meanwhile, GJEPC is actively exploring new markets through initiatives including the upcoming Saudi Arabia Jewellery Exhibition (SAJEX) that is expected to open fresh avenues in emerging regions and diversify India's export destinations . "While we understand that no trade talks can happen in the current scenario, we urge the government for immediate relief. We appeal for policy reforms and extensive support to aid the industry in these extraordinarily challenging times. "We urge the government to provide the industry relief through Duty Drawback Scheme, financial support for market diversification through Market Access Initiative (MAI) scheme, deferment of interest on working capital facilities, allowance of reverse job work by units located in SEZs, allow exporters to offload their existing stock or pipeline to the domestic market, relief packages among others," he added. On August 6, President Trump announced an additional 25 per cent tariff on all Indian imports, on top of an existing 25 per cent duty, taking the total to 50% with effect from August 27.
