- विज्ञापन -
New Delhi: The decision to eliminate basic customs duty on imported lithium-ion battery scrap and machinery for battery production is expected to bolster India’s domestic battery storage industry, according to industry experts.
In her Union Budget 2025-26 speech, Finance Minister Nirmala Sitharaman announced the inclusion of 35 additional capital goods for electric vehicle (EV) battery manufacturing and 28 for mobile phone battery production in the list of exempted goods. She stated, “This will enhance domestic production of lithium-ion batteries for both mobile phones and electric vehicles.”
Additionally, the budget proposes reducing customs duty on lithium-ion battery waste and scrap from 5% to zero. Ankit Hakhu, Director at Crisil Ratings Ltd, pointed out that benefiting from this move will enable more effective cost control, quality management, and supply chain stability for renewable battery projects, which are projected to account for over 33% of India’s renewable power capacity growth in the next 3-5 fiscal years.
Ashok Chandak, President of the India Electronics and Semiconductor Association (IESA), noted that the decreased basic customs duty on display panels and lithium-ion batteries will support local value addition in both EV and mobile manufacturing.
Furthermore, Angshuman Bhattacharya, a Partner and National Leader at EY-Parthenon, emphasized that local production of electric vehicles and lithium carbonate batteries will foster a robust domestic ecosystem.
The budget also promotes the domestic manufacturing of renewable energy components, specifically lithium-ion batteries, by extending the critical minerals list eligible for basic customs duty waivers. In the July 2024 budget, the government had already fully exempted basic customs duty on 25 critical minerals that are not produced domestically. As part of the latest proposal, cobalt powder, lithium-ion battery scrap, lead, zinc, and 12 other critical minerals will also be fully exempted. FM Sitharaman stated, “This will help secure availability for manufacturing in India and create more job opportunities for our youth.”
