ISLAMABAD: The country’s gold jewellery sector has expressed serious concern over the non-implementation of the revised Value Addition Norms (VAN), despite a decision taken at an inter-stakeholder level, including the State Bank of Pakistan (SBP), more than three months ago.
In a letter addressed to Commerce Minister Jam Kamal — copies of which were also sent to the Prime Minister and other relevant authorities — Arif Patel, representative of the Golden Arts Manufacturers and Exporters of Artistic Gold Jewelry, stated that one of the key reasons behind the sector’s failure to achieve export targets is the persistent neglect of high-potential industries and the lack of attention to their legitimate concerns.
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According to the letter, Pakistan’s gold jewellery exports have remained stagnant at around USD 20–30 million for several years, in stark contrast to India’s USD 40 billion exports. Countries such as Turkey, Malaysia and Italy, he noted, have achieved remarkable growth by adopting business-friendly policies.
The sector has identified SRO 760(I)/2013, which governs gold trade, as a major impediment to growth, terming it the “mother of all ills.” Since its introduction in 2013, stakeholders have made repeated efforts to persuade the government to amend the SRO, submitting multiple representations to various authorities, including the Ministry of Commerce, but to no avail.
As a last resort, the sector approached the National Assembly Standing Committee on Commerce, requesting a reduction in the Value Addition Norms, which it described as the most damaging condition due to the requirement of 300 percent remittance. After three months of deliberations, the committee accepted the industry’s proposal to revise VAN on March 22, 2026. However, despite the passage of more than three months, the decision has yet to be implemented.
Official documents presented by the Ministry of Commerce before the Standing Committee on July 3, 2026, reveal that a consultative meeting involving all relevant stakeholders, including the SBP, was held on March 16, 2026, under the chairmanship of Special Secretary Syed Hamid Ali. The meeting discussed SRO 760(I)/2013 in detail, including regional comparisons, and explored proposals to address systemic issues.
The ministry stated that the minutes of the meeting were circulated among stakeholders on March 19, 2026, and have since been finalised.
According to the minutes shared with the committee, Arif Patel raised concerns regarding the existing value addition mechanism, which is linked to international gold prices. He highlighted that since 2013, gold prices have surged from approximately USD 1,380 per ounce to around USD 5,100 per ounce — an increase of about 400 percent — making the current system impractical and inconsistent with international practices.
He proposed that value addition should be determined on a per-gram basis instead of a percentage of gold value. Specifically, he suggested setting value addition at USD 1.50 per gram for plain bangles and chains, USD 2.00 per gram for other plain jewellery, and USD 4.00 per gram for studded or embedded jewellery.
The Chairman of the Gems and Jewelry Council, Salman Hanif, supported this proposal, advocating for a shift to a per-gram valuation system. The SBP representative also endorsed the proposal, clarifying that the central bank has no reservations regarding either methodology and has not issued any directive mandating a percentage-based system.
However, the representative of the Ministry of Industries and Production (MoI&P) suggested retaining the existing percentage-based mechanism, albeit with reduced rates aligned with regional practices. Despite differing views, there was a consensus among stakeholders that the current value addition mechanism requires rationalisation.
In his latest letter dated July 4, 2026, Arif Patel urged the Commerce Minister to intervene and ensure immediate implementation of the committee’s decision, warning that continued delays are severely impacting the sector’s export performance.
Copyright Business Recorder, 2026