Diamond Imprest Authorization Scheme

PRELIMS BITS

India will launch the Diamond Imprest Authorization (DIA) Scheme on April 1, 2025, in response to global beneficiation policies, which require local processing facilities for diamond manufacturing.

Scheme Overview

• The DIA Scheme allows duty-free import of natural cut and polished diamonds, aiming to increase value addition and boost exports.
• It permits the duty-free import of diamonds under ¼ Carat.
• Exporters must add 10% value before exporting.
• Eligible exporters include those with Two Star Export House status and annual exports of $15 million or more.

Exemptions and Benefits

• Imports under this scheme are exempt from duties like Basic Customs Duty and Integrated Tax, lowering costs and fostering a competitive market.

Target Audience

• Primarily benefits Indian diamond exporters, especially MSMEs, enabling smaller firms to compete with larger players in the diamond industry.

Global Context

• This scheme aligns with global diamond beneficiation trends, similar to policies in Botswana and Namibia, which mandate local processing for added value.

Economic Impact

• The scheme aims to reduce capital flight by keeping value addition within India, create jobs in diamond processing, and revive the domestic industry, which has faced export declines and job losses.

Industry Challenges

• The Indian diamond industry is struggling with reduced exports and employment. The DIA Scheme seeks to revitalize the sector with support and incentives.