Gemming industry latest boon to national economy
Dr. Tilak S. Fernando
Tuesday, 12 February 2008
Sri Lanka depicts a tiny dot in the map of the world. Three major exporting
commodities, Rubber, Tea and Coconut once placed this tiny speck in
the world map to earn her foreign exchange and became known among overseas
traders and importers. Of late, the English gentleman's game of cricket
placed Sri Lanka on the plinth of popularity. The on-going terrorist
war has made its name filter through mass media to every nook and corner
of the world. Athletes like Susanthika Jayasinghe, followed by various
other sports men and women at international level have made the name
Sri Lanka reverberate on international billboards and television screens.
Yet, how many are fully knowledgeable about the great treasures buried
under this amazing island's own chattels? Although many have been talking
about Sri Lankan precious stones on the British Crown, not sparing the
late 'Princess Diana's expensive Blue Sapphire from Sri Lanka', yet
not many have made any serious attempts, for too long, to explain or
educate the international community at large about the prevalent gemming
industry in Sri Lanka and the craftsmen's skills available here to cut
and polish such regal jewels to radiate majestically. Leave alone the
foreigners and international markets, how many people in Sri Lanka itself
are aware that nearly three quarters of our land is blessed with gems
buried in 46 proposed identification locations spread right across the
The late Dr. N.M. Perea initiated the State Gem Corporation in 1971.
By 1993 there existed a need to implement strategies and policies for
the development of the Gem and Jewellery industry under Act No. 50 of
1993. On 1st March 1993, therefore, The State Gem Corporation ceased
to exist and transformed the industry into a new agency under the National
Gem and Jewellery Authority (NGJA).
NGJA policy to relax the stringent restrictions at the airport which
virtually throttled all opportunities of importing gems to the country
with no more 'leave at Customs and clear later' regulations but with
'immediate clearance' facilities along with a reduction of the 30% import
tax to a bare minimum of 3% made the industry boom and bring positive
results during the 2nd half of 2007. This generated a highest export
figures for the first time out of the gemming and Jewellery with maximum
profits since 1971.
The National Gem and Jewellery Authority statistics in the second half
of 2007 reveal export revenue of Rs.51.9 billion which is a 16% growth
rate over its previous year's figure of Rs. 44.9 billion. Similarly,
gem exports had increased to Rs.10.4 billion, a 6% increase than the
amount reported in 2006. Even more significant has been the rise in
jewellery exports which has recorded Rs. 2.89 billion, a 17% increase
than in 2006. Diamond exports have earned Rs. 37.77 billion recording
a staggering increase up to 19% over the Rs.31.7 billion in 2006.
In line with the latest policies adopted by the Gem and Jewellery Authority
any new venture with a minimum investment of at least Rs. 50 million
with export orders not less than 80% of output will qualify to a three
year tax holiday and corporate tax for 2 years at a 10% and 20% thereafter.
The latest research by the Gem and Jewellery Research and Training
Institute show 46 'proposed identified' sites of gem deposits in Sri
Lanka. Distribution of gem minerals spread from Mihintale down to Ridiyagama
down south embracing Kantale, Lunugala, Getahatta, Eheliyagoda, Kuruwita,
Hatton, Maskeliya, Moneragala, Okkampitiya, Kiriella, Bulathsinghala,
Ratnapura Pelmadulla, Balangoda, Agalawatta, Akarella, Nivithigala,
Rakwana, Kalawana, Deniyaya, Embilipitiya, Kataragama, Elpitiya, Meetiyagoda,
Morawaka, Ridiyagama, and Akuressa. Recent gem deposits found by the
GJRTI include Naula, Bakamuna, Elahera, Attaragallewa, Kaluganga, Hattota
Amuna, Ballapana, Galapitamada and Akarella.
There is a great opportunity for Sri Lanka to prosper in the future
if correct polices are revised and continued to utilize gems buried
in the above mentioned sites. In certain circles some believe that Sri
Lanka has already lost a great deal of wealth buried under the Mahaweli
project, with no access or hope in the future. Similarly Kothmale and
Moragahakanda sites have become a hot potato these days with the environmentalists,
planters, government ministers and the Gem Authority engaged in a policy
making tug of war! Moragahakanda too is identified as a source full
of the most expensive gems in the world, but its future will ultimately
depend on an executive decision by President Rajapaksa alone.
Meanwhile widely spread rumours keep on buzzing within the gemming
circles about some hidden agendas in certain quarters to shut down this
budding Gem and Jewellery Authority, which has begun to show profits,
and to hand it over to the private sector on a plattter which some believe
may include Thailand, in the name of liberalising the industry.
If such rumours are to be taken seriously and have any ground, one
could only assume that it would be the final nail on the NGJA coffin
at a time when the industry has just started to boom with new policies,
modern techniques, specialised training facilities (with safe methods
of mining), welfare insurance packages and incentives to miners.
One cannot expect private entrepreneurs to be highly disciplined unlike
in a government controlled organisation of this nature when, for obvious
reasons the very people are allowed to dabble in gemming and trading!
If such an unfortunate chain of events were to take place in the future,
critics prophesise that the NHJA is going to lose about 40% income generated
by them at present. It is also stated that around 6000 Sri Lankans working
in Thailand in the gem trade at present are using illegal means to smuggle
out Sri Lanka's precious stones in most devious means, even under stringent
government controls at present. Should such an environment become inevitable,
then it is suggested that gemming should not be restricted to only a
chosen few but free to all, while making the NHJA as custodians with
certain amount of powers to monitor.
Advanced countries in Asia such as Malaysia and India are good examples
for Sri Lanka to emulate. Their national policies being to recognise
the local product, local industries and local manufacturers have successfully
paved the way towards industrial expansion and helped them to build
up a sound economy and become profound foreign Exchange earners simultaneously.
If Sri Lanka is seriously thinking of attaining an advanced and progressive
state, like her neighbours, Malaysia or India, then petty politics of
every kind, bickering and resentments need to be shed aside for self
esteem, egotistical reasons or personal gains and be united and national
With the latest customer service facilities introduced at NGJA headquarters
with one-stop-shop facility under a single roof with valuations, access
to courier companies and post office facilities at finger tips, an exporter
is today able to send out his consignments within one hour. Similarly
the same facilities are available at the NGJA offices at Katunanayake
airport cargo terminal on a round the clock, 24 hours service basis.
In its endeavors to promote the industry, the National Gem and Jewellery
Authority "NGJA" has made arrangements to organize "Sri
Lanka Pavilion's" at eight major gem and Jewellery shows in 2008.
Disclaimer: The comments contained
within this website are personal reflection only and do not necessarily
reflect the views of the LankaWeb. LankaWeb.com offers the contents
of this website without charge, but does not necessarily endorse the
views and opinions expressed within. Neither the LankaWeb nor the individual
authors of any material on this Web site accept responsibility for any
loss or damage, however caused (including through negligence), which
you may directly or indirectly suffer arising out of your use of or
reliance on information contained on or accessed through this Web site.
© 1997-2004 www.lankaweb.Com
Newspapers Ltd. All rights reserved.