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Gold Jewelers in India to Close Shops in Excise Tax Protest

  • Shops shut in Mumbai's Zaveri Bazaar, country's top market
  • Industry says it's suffering from weak demand after price rise
Gold chains and necklaces sit on display inside a jewelry store in Mumbai. Gold shipments rose to $3.8 billion, boosted by demand from the so-called wedding season in India. The new duty comes at a time when the industry is facing a slowdown in purchases because of the surge in prices since the start of the year and after a poor monsoon cut harvests and incomes in rural India, a traditional source of demand.

Gold chains and necklaces sit on display inside a jewelry store in Mumbai. Gold shipments rose to $3.8 billion, boosted by demand from the so-called wedding season in India. The new duty comes at a time when the industry is facing a slowdown in purchases because of the surge in prices since the start of the year and after a poor monsoon cut harvests and incomes in rural India, a traditional source of demand.

Photographer: Dhiraj Singh/Bloomberg
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Jewelry shops across India, the world’s biggest market after China, will shutter for three days starting Wednesday in a bid to reverse plans by Prime Minister Narendra Modi to impose a 1 percent excise duty, according to the All India Gems & Jewellery Trade Federation.

The government should withdraw the levy announced in Monday’s budget because the industry is suffering from weak demand and high import taxes, Bachhraj Bamalwa, director at the federation, said by phone from Kolkata. The group represents 300,000 jewelers and bullion dealers in the nation. The India Bullion and Jewellers Association Ltd. said earlier it was shuttering outlets at Mumbai’s Zaveri Bazaar, the country’s largest market, until further notice.