India's budget 2024: Customs duty amendments to spur growth in key sectors
Date of publication: August 12th, 2024
The Indian Customs has announced significant updates to the Customs Duty and Act on July 23rd, 2024. Due to the election this year, Budget 2024 was revealed in July instead of its usual February announcement. This article offers an overview of the tariff amendments included in the budget.
Major impacted sectors
Below table provides information on impacted sectors due to Basic Customs Duty (BCD) changes:
Types of Amendments - BCD | Major Impacted Sectors |
|---|---|
Reduction | Agriculture, Critical Minerals, Aquafarming and Marine, Textile and Leather, Electronics Goods and Equipment, Precious Metals, Other Metals, steel, copper, Shipping, IT and Electronics, Medical Equipment |
Increase | Chemicals & Petrochemicals, Plastics and Chemicals, Renewable Sector |
Exemption | Drugs, Capital Goods |
Import duty
The table below provides information on product wise import duty changes:
The BCD on following ingredients/inputs for use in the manufacture of Prawn and Shrimps feed or fish feed is being reduced subject to Import of Goods at Concessional Rate of Duty (IGCR) condition.
The duty rates on precious metals have been revised as follow:
New Duty Rate | Products |
|---|---|
0% | Critical Minerals (Antimony, Beryllium, Bismuth, Cobalt, Copper, Gallium, Germanium, Hafnium, Indium, Lithium, Molybdenum, Niobium, Nickel, Potash, REE, Rhenium, Strontium, Tantalum, Tellurium, Tin, Tungsten, Vanadium, Zirconium, Selenium, Cadmium, Silicon other than Quartz & Silicon Dioxide), Artemia and Artemia, Pre-dust breaded powder for use in processing of sea-food, Drugs: (Trastuzumab Deruxtecan, Osimertinib, Durvalumab) |
2.50% | Critical Minerals: Graphite, Silicon Quartz & Silicon Dioxide |
5% | Prawn & Shrimps feed, Live SPF Vannamei shrimp, Insect Meal for use in R&D for aquatic feed manufacturing, Single Cell Protein from Natural Gas for use in R&D aquatic feed manufacturing, SPF Polychaete worms, MDI for manufacture of spandex yarn (subject to conditions) |
10% | Ammonium Nirate, Real Down Filling material from duck or goose |
15% | Shea nuts |
25% | PVC Flex Films/Flex Banners |
Description of goods | From | To |
|---|---|---|
Mineral & vitamin premixes, Krill Meal | 5% | Nil |
Fish lipid oil, Algal prime (flour) | 15% | Nil |
Crude fish oil | 30% | Nil |
Basic Customs Duty | Agri. & Infro. Development Cass | Social Welfare Surcharge | |||||
|---|---|---|---|---|---|---|---|
Commodity | From | To | From | To | From | To | Total duty |
Gold Bars, Silver Bar | 10% | 5% | 5% | 1% | Nil | Nil | 6% |
Gold Dore | 10% | 5% | 4.35% | 0.35% | Nil | Nil | 5.35% |
Platinum | 10% | 5% | 5.40% | 1.40% | Nil | Nil | 6.40% |
Silver Dore | 10% | 5% | 4.35% | 0.35% | Nil | Nil | 5.35% |
Export duty
The effective export duty structure on raw hides, skins and leather have been simplified and rationalized as under:
Commodity | Rate of duties From | Rate of duties To |
|---|---|---|
Raw Hides & skins, all sorts (other than buffalo) | 40% | 40% |
Raw Hides & skins of buffalo | 30% | 30% |
Raw fur and skins including lamb fur skin | 60/10% | 40% |
Wet Blue Chrome Leather, Crust Leather | 40% | 20% |
Tanned fur skin | 60% | 20% |
E.I Tanned Leather, finished leather (as defined by DGFT) | Nil | Nil |
Import exemptions
A comprehensive review has been undertaken in respect of 188 conditional exemptions/concessional rates (150 entries in Notification No. 50/2017, 38 exemptions/concessional rates are standalone Notifications). The summary of changes is as shown:
- 30 exemptions/ concessional rates are being extended up to 31.3.2029,
- 126 exemptions/ concessional rates are being continued up to 31.3.2026
- 28 exemptions/ concessional rates are being lapsed on their end dates of 30.9.2024
- End dates are being removed in 4 exemptions as they are covered by the exclusion clause.
Conclusion
The above changes aim to promote the growth of key sectors, simplify the duty structure, and align with global trade practices. The updates are expected to have a positive impact on the economy, encouraging domestic production, reducing dependence on imports, and making essential goods more affordable.Recognizing the importance of these changes for our clients, we have already made them available on ONESOURCE Global Trade Content (GTC). For more information on how ONESOURCE Global Trade solutions can assist you in adopting our Global Trade Content, please contact your Account Manager or Client Services Manager.