Synopsis
On February 1, Union Finance Minister Nirmala Sitharaman announced the Budget 2025-26, detailing key changes in basic customs duties. The budget aims to reduce prices for smartphones and electric vehicles while increasing costs for TVs and fabrics, reflecting a shift in economic strategy.Key Takeaways
- Healthcare: 36 life-saving drugs exempt from duties.
- Electronics: Price drops on mobile phones and components.
- EV Sector: Duty exemptions on battery manufacturing goods.
- Leather Goods: Lower costs expected for jackets and shoes.
- Marine Products: Reduced customs duties on fish products.
New Delhi, Feb 1 (NationPress) Union Finance Minister Nirmala Sitharaman unveiled significant alterations in basic customs duties (BCDs) during the Budget 2025-26 presentation on Saturday. These modifications will influence the pricing of numerous products.
The budget offers duty waivers on essential medications, electronic items, components of electric vehicles (EVs), and mobile phone parts, making them more accessible to consumers.
A major relief is observed in the healthcare domain, where the government has completely waived customs duties on 36 life-saving medications used in treating cancer and chronic ailments.
Moreover, an additional 37 medicines will also be exempt from duties, enhancing the affordability of vital medical treatments for patients.
Electronics and technology products are poised for price reductions as the government has decreased the basic customs duty on open cells and various components utilized in electronic devices.
Mobile phones will also experience a drop in prices, thanks to the exemption of duties on 28 additional components essential for mobile phone batteries.
Similarly, products like headphones, wired headsets, microphones, and USB cables will benefit from customs duty waivers on the raw materials required for their production.
The EV industry is set to gain significantly with duty exemptions on 35 additional items used in the production of EV batteries.
Furthermore, the government has eliminated duties on cobalt powder, lithium-ion batteries, and 12 other critical minerals vital for the manufacture of EVs, mobile phones, and a range of high-tech devices.
In the leather sector, the exemption of basic customs duty on wet blue leather is anticipated to reduce manufacturing costs. Consequently, items like jackets, shoes, belts, and handbags are expected to become more affordable.
The shipbuilding industry will also see advantages as the government extends duty exemptions on raw material components for an additional decade.
Marine products will experience price reductions, with a decrease in customs duty on fish pasteurii from 30% to 5%.
The duty on fish hydrolysate, used in producing aquatic feed, will now drop to 5% from the previous 15%.
The budget also aims to bolster India’s handicraft exports by enhancing global competitiveness.
In a further effort to support the domestic technology sector, the government has cut the customs duty on carrier-grade Ethernet switches from 20% to 10%.
However, some items will see an increase in prices. Knitted fabrics will now incur a higher customs duty of 20% or ₹115 per kg, whichever is greater.
The government has also increased the duty on flat-panel displays for TVs from 10% to 20%, a change expected to raise television prices.
This adjustment is designed to rectify the inverted duty structure and promote local production of TV components.
Additionally, motorcycles with engine capacities not exceeding 1,600 cc will now face a 40% customs duty, down from the previous 50%.
