The Central Board of Indirect Taxes and Customs under the Ministry of Finance has granted approval to the Surat International Diatrade Centre (SIDC), a SPV set up by The Gem & Jewellery Export Promotion Council, to commence operations at India’s second Special Notified Zone (SNZ) for Rough Diamonds.

The move will give Surat-based SMEs in the diamond sector direct access to rough diamonds offered by the mining companies.

The new SNZ will be along the lines of the Special Notified Zone at Bharat Diamond Bourse, Mumbai that began operations in 2015.

Permission for the new SNZ has been granted following representations made by GJEPC which said that though Surat is the hub for the diamond cutting and polishing industry dealing mostly in small gem stones, the availability of raw material at competitive prices to SMEs of this sector has remained a cause of major concern.

SIDC will operate a facility in Gujarat Hira Bourse, Ichhapore Surat for the “import, trading & re-export of rough diamonds by notified entities”. It has taken approx. 3,000 sq. ft. of constructed area on long term lease rental basis from Gujarat Hira Bourse at Ichhapore, Surat and has set up a state of art viewing facility there. The facility has a Strong Room and necessary commercial, security & related facilities. M/s Diamond and Gem Development Corporation Ltd. (DGDC) has been appointed as the custodian, CBIC said.

DGDC shall submit the floor plan, proposed facilities, including security related features, for approval under Section 8 of the Customs Act, 1962 and in terms of the requirements under “Handling of Cargo in Customs Area Regulation, 2009” to the jurisdictional Principal Commissioner of Customs or Commissioner of Customs, as the case maybe, the Circular stated.

The CBIC Circular also outlined the procedures to be followed in the import, viewing and re-export of parcels of rough diamonds as well as the processes related to shipping bills and invoices in case of sales. It states that “sales of rough diamonds from the SNZ shall be of a single or multiple lots but no sale of a sub-lot will be allowed” and “mixing of lots of the Rough Diamonds will not be permitted”.

Companies entitled to avail of the facility of consigning rough diamonds to India for the purpose of viewing and sales from the SNZ shall be those as are permitted vide RBI’s Circular No.116 dated 1.4.2014 as amended from time to time, CBIC clarified.