EU’s Trade Deal with India May Include Tax Cut on Polished Imports

The Antwerp World Diamond Centre (AWDC) expects that a newly minted trade deal between the European Union and India will include a reduction of import duty on EU-origin diamonds.

While the AWDC has not yet received official confirmation, the drop in the tax, which would go down to 2.5% from its current 5.5%, would apply to natural diamonds polished in the EU and shipped to India, the Belgian organization said Tuesday. This part of the deal would follow sustained lobbying by the group, working with the European Commission (EC), it explained.

If the reduction is formally adopted, it would likely provide a strong boost for Antwerp as a polishing center and improve its competitiveness with other trading hubs. It would also engender a more positive outlook for Belgian exports to India, one of the fastest-growing jewelry markets, the AWDC claimed. Additionally, if the lower import duty becomes structurally fixed, it would create greater long-term predictability for the Antwerp diamond trade, the organization added.

If implemented, the move would build on the progress the AWDC and EC have already made in boosting Antwerp as a diamond hub when they helped negotiate the tariff rate for importing EU polished into the US down to 0% from 15%. That deal made the Belgian city the only major trading hub with tariff-free imports to the US.

Image: Polished diamonds. (Shutterstock)