RBI eases lending norms for import of diamonds

Mumbai: The Reserve Bank of India (RBI) on Monday eased norms on the availability of bank credit for import of diamonds. The central bank has now allowed lenders to give trade credit for imports or issue letters of credit for import for a period of 180 days from the date of shipment, as against 90 days earlier.

The relaxation came following representations received from Gems and Jewellery Export Promotion Council (GJEPC), RBI said in a notification on Monday. The new rule is effective immediately.

The central bank cautioned that banks should ensure that the necessary due diligence is undertaken during such import transactions to avert violations related to know your customer and anti-money laundering.

Further, any large or abnormal increase in the volume of business should be closely examined to ensure that the transactions are bona fide, RBI said.