The Directorate General of Foreign Trade (DGFT) has issued Notification No. 48/2025‑26, changing the import policy for certain silver jewellery under ITC HS code 71131921 from “Free” to “Restricted”. The move, effective immediately, marks a significant regulatory shift aimed at tightening control over imports and supporting domestic manufacturing.
Policy Change in Focus
Under the revised regulation, specific silver jewellery—whether or not plated or clad with other precious metals—will now require import licenses and authorisations, replacing the previous “Free” import status. The change applies to goods classified under HS code 71131921, which includes a range of unstudded silver jewellery.
Rationale Behind the Decision
The DGFT cited a surge in imports of unstudded silver jewellery as the primary reason for the revision. Increased imports, particularly from certain international trade channels, had led to an influx of low-cost jewellery, posing challenges for domestic producers and impacting the trade balance. By moving the category to “Restricted,” the government aims to:
- Exercise stricter control over imported jewellery, including its valuation and country of origin.
- Support domestic craftsmen, micro, small, and medium enterprises (MSMEs), and value-added jewellery manufacturing.
- Protect foreign exchange reserves by regulating uncontrolled import flows.
Implications for Industry
The policy revision affects multiple stakeholders:
- Importers and Trading Houses: Must now comply with licensing procedures, potentially facing delays and additional administrative costs.
- Domestic Manufacturers and Artisans: Stand to benefit as the restriction could reduce competition from low-cost imports, creating opportunities for local value-added production.
- Export-Oriented Units: SEZ units, 100% Export-Oriented Units (EOUs), and other authorised schemes remain exempt from the restriction, ensuring continuity in export operations.
- Retailers and Wholesalers: May experience short-term inventory constraints and pricing adjustments as supply chains adapt to the new regulatory environment.
Timeline and Compliance Overview
| Item | Details |
|---|---|
| Effective Date | 17 November 2025 |
| HS Code Impacted | 71131921 |
| Status Change | “Free” → “Restricted” |
| Exemptions | SEZ/EOU/export-scheme units remain exempt |
Strategic Outlook
The DGFT’s move signals a more interventionist approach to import regulation in the gems and jewellery sector. Industry participants are advised to strengthen compliance mechanisms, review sourcing strategies, and stay abreast of potential updates to the policy. While the shift is intended to promote domestic manufacturing, extended restrictions could lead to higher costs for retailers and consumers.
By restricting imports of specific silver jewellery, the DGFT has reinforced its commitment to protecting domestic industry while maintaining oversight of international trade flows. The policy change is expected to reshape the market landscape, offering domestic manufacturers new growth opportunities while challenging importers to adapt to stricter regulatory requirements.
