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Presenting the Union Budget 2024-25, Finance Minister Nirmala Sitharaman on Tuesday announced a reduction in Customs duty on a range of input materials such as critical minerals, electronics, chemicals, and precious metals, among others. The government has focused on streamlining Customs duties to enhance revenue and support domestic manufacturing, she added.
To enhance domestic value addition in gold and precious metal jewellery in India, Sitharaman said she is proposing a reduction in Customs duties on gold and silver to 6 per cent and that of platinum to 6.4 per cent. She also proposed to remove basic customs duty (BCD) on ferronickel and blister copper, while increasing the same on specified telecom equipment.
Presenting her seventh straight Budget, Finance Minister Nirmala Sitharaman proposed a reduction in BCD on gold and silver to 6 per cent and platinum to 6.4 per cent. “To enhance domestic value addition in gold and precious metal jewellery, I propose to reduce customs duties of gold and silver,” she said. The current price of gold stands at Rs 7,358 per gram for 24 carat, silver at Rs 91 per gram and platinum at Rs 2,552 per gram.
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Sitharaman said that with a “three-fold increase in domestic production” and almost “100-fold jump in exports of mobile phones over the last six years”, the Indian mobile phone industry “has matured”. She then proposed to reduce the BCD on mobile phones, mobile Printed Circuit Board Assembly (PCBA) — a pivotal component for connecting and powering various electronic units —and mobile chargers to 15 per cent.
To provide relief to cancer patients, Sitharaman proposed to fully exempt three more medicines from Customs duties. The finance minister also proposed changes in the BCD on X-ray tubes and flat panel detectors for use in medical X-ray machines under the phased manufacturing programme.
Saying that “energy transition is critical in the fight against climate change”, Sitharaman proposed to expand the list of exempted capital goods for use in the manufacture of solar cells and panels. Sitharaman also proposed to fully exempt Customs duties on 25 critical minerals and reduce BCD on two of them, saying that “minerals such as lithium, copper, cobalt and rare earth elements are critical for sectors like nuclear energy, renewable energy, space, defence, telecommunications, and high-tech electronics”.
To increase value addition in the domestic electronics industry, Sitharaman proposed to remove the BCD, subject to conditions, on oxygen-free copper for manufacturing resistors. Certain parts for manufacturing of connectors are also likely to get exempted.
To enhance “competitiveness of exports in the leather and textile sectors”, BCD on real down filling material from duck or goose has been reduced. “To rectify inversion in duty, I propose to reduce BCD, subject to conditions, on methylene diphenyl diisocyanate (MDI) for manufacture of spandex yarn from 7.5 to 5 per cent,” Sitharaman said, adding that the export duty structure on raw hides, skins and leather is also likely to be simplified and rationalised.
Sitharaman said that to incentivise domestic manufacturing, she proposed to increase the BCD from 10 per cent to 15 per cent on PCBA of specific, specified telecom equipment.
“Steel and copper are important raw materials to reduce the cost of production, I propose to remove the BCD on ferronickel and blister copper. I am also continuing with nil BCD on ferrous scrap and nickel cathode and concessional BCD of 2.5 per cent on copper scrap,” Sitharaman said.
