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Advance Remittance for Import of Rough Diamonds Liberalised

Based on the recommendations of the Gems and Jewellery Export Promotion Council (GJEPC) and with a view to liberalising the procedure further and facilitate import of rough diamonds, AD Category - I banks are, henceforth, permitted to allow advance remittance without any limit and without bank guarantee or standby letter of credit, by an importer (other than a Public Sector Company or a Department / Undertaking of the Government of India / State Government/s), for import of rough diamonds into India from the undernoted mining companies, viz.

i) Diamond Trading Company Pvt. Ltd., UK,
ii) RIO TINTO, UK,
iii) BHP Billiton, Australia,
iv) ENDIAMA, E. P. Angola,
v) ALROSA, Russia, and
vi) GOKHARAN, Russia.

While allowing the advance remittance, AD Category - I banks may ensure the following :

(i)The importer should be a recognised processor of rough diamonds as per a list to be approved by GJEPC in this regard and should have a good track record of export realisation;

(ii) AD Category - I banks should undertake the transaction based on their commercial judgment and after being satisfied about the bonafides of the transaction;

(iii) Advance payments should be made strictly as per the terms of the sale contract and should be made directly to the account of the company concerned, that is, to the ultimate beneficiary and not through numbered accounts or otherwise. Further, due caution may be exercised to ensure that remittance is not permitted for import of conflict diamonds;

(iv) KYC and due diligence exercise should be done by the AD Category - I banks for the Indian importer entity and the overseas company; and

(v) AD Category - I banks should follow up submission of the Bill of Entry / documents evidencing import of rough diamonds into the country by the importer, in terms of the Act / Rules / Regulations / Directions issued in this regard.

In case of an importer entity in the Public Sector or a Department / Undertaking of the Government of India / State Government/s, AD Category - I banks may permit advance remittance subject to the above conditions and a specific waiver of bank guarantee from the Ministry of Finance, Government of India where the advance payments is equivalent to or exceeds USD 100,000/- (USD one hundred thousand only).

AD Category - I banks are required to submit a report of all such advance remittances made without a bank guarantee or standby letter of credit, where the amount of advance payment is equivalent to or exceeds USD 5,000,000/- (USD Five million only).


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