Circular No. 64/ 97
dated 25/ 11/ 97
[F.No. 305/ 90/ 97- FTT]
Government of India
Ministry of Finance
Department of Revenue, New Delhi

Subject :-   Export of rough Diamonds under Exim Policy, 1997-2002- Regarding.

   A doubt had arisen as to whether rough diamonds purchased from the open market can be exported without any restriction. The issue was examined in consultation with Ministry of Commerce and it was clarified by the Board that there should be no bar for export of rough diamonds even if procured from domestic market provided the payment is received is freely convertible  currency.

2.  The above question had also been examined by the Directorate General of. Foreign Trade in consultation with the Ministry of Commerce. The DGFT has now clarified the issue under their F.No. 1/ 9/ 44/ 97-98/ PC-II / 527 dated 18.6.97 (copy enclosed for ready reference).

3.  I am directed to inform you to follow the above said clarification for the export of rough diamonds.

 Sd /-
(O.P. Khanduja)
Senior Technical Officer (FTT)


Government of India, Ministry of Commerce
Directorate General of Foreign Trade
Udyog Bhawan, New Delhi- 110011

No. 1/9/44/ 97-98/ PC -II/ 527

Dated 18.6.199

Subject :    Clarification on export or rough diamonds

Dear Sh. V.S.A. Suri, Secretary, C & JEPC,

Kindly refer to your various letters on the subject. We have also received some other representations from individual exporters on the above subject. In consultation with the Ministry of Commerce, it has been decided to clarify as follows :-

(1)  Third party exports of rough diamonds are allowed in terms of paragraph 8.2 of Exim Policy, 1997-2002. However, the export of rough diamonds will be further governed by the provisions of para 8.9 of Handbook of Procedures (Vol.1).

(2)  Third party imports of rough diamonds are not allowed. Even where the licence holder wants to take the help of agent, then even this agent has to work only as a facilitator and not as an importer as per para 5.7 of Handbook of Procedures (Vol.1).

(3) As per para 8.9 of Handbook of Procedures (Vol.1) the licensing authority while issuing the REP licence shall make suitable endorsement on the original bill of entry to avoid further use of the same bill of entry. The customs are not required to verify bill of entry because export of rough diamonds will be either under para 8.9 of Handbook of Procedures in which case they will have to come to Joint DGFT Office or under para 11.8 of Exim Policy in which case the operation will be from custom bonded warehouses.

(4) The value of rough diamonds are allowed as per para 8.9 of Handbook of Procedures (Vol.1) and in case export in excess of limit prescribed under para 8.9 of Handbook of Procedures (Vol. 1) is to be done then it will have to be done under para 11.8 of Exim Policy, 1997-2002. This is because the rough diamonds are appearing in the Negative List of Imports and since these rough diamonds are imported and these have to be exported within the parameters of paragraph 8.9 of Handbook of Procedures (Vol. 1) read with paragraph 11.8 of Exim Policy 1997-2002.

(5)  Export can be on the basis of several bill of entries clubbed together however, the total value of export of rough diamonds should not exceed 10% of the value of imports made against relevant bill of entry.

(6) As regards export of rough diamonds the exporter shall furnish bill of entry in his own name for imports of rough diamonds effected on or after 1.4.97

2.  This issues with the approval of DGFT / Ministry of Commerce.

Sd /-
(L.B. Singhal)
Dy. Director General of Foreign Trade

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