New Delhi, February 1 (IANS). Finance Minister Nirmala Sitharaman announced to reduce custom duty in many sectors in the Union Budget 2026-27 presented in the Lok Sabha on Sunday to strengthen manufacturing and increase exports. These include important sectors like marine products, textiles, leather, defense and aviation.
In order to increase exports of marine products, the government has proposed to increase the duty-free import limit of some inputs used in seafood processing. It will be increased from 1 percent to 3 percent of last year’s export turnover.
The Finance Minister said that till now the duty-free import facility which was available for the export of leather or synthetic shoes, will now be extended to the export of shoe uppers also. This is expected to increase employment and income in these labour-dependent industries.
Exporters of leather, textiles, synthetic shoes and other leather products will now be given 1 year instead of 6 months to ship the final product.
Basic custom duty exemption on machinery used in manufacturing lithium-ion batteries will now be extended to battery energy storage systems as well. Apart from this, there will be no custom duty on the import of sodium antimony used in making solar glass.
A provision has been made in the budget to exempt custom duty on parts used in the manufacturing of civil training aircraft and other aircraft. There will also be no duty on raw materials imported by defense sector units for repair and maintenance of aircraft.
It has also been proposed to exempt certain parts used in manufacturing microwave ovens from Basic Custom Duty (BCD).
Due to disruptions in global trade, many factories in Special Economic Zones (SEZs) are not able to operate at full capacity. To overcome this problem, the government has announced a one-time relief to allow eligible SEZ units to sell goods in the domestic market at lower custom duty.
It is proposed to extend the exemption from custom duty on import of goods used in the nuclear power sector till 2035. Also, this facility will now be available to all nuclear plants, irrespective of their capacity.
Custom duty will also be exempted on machines imported for processing critical minerals in the country.
The Finance Minister said that the value received from biogas will not be included in the calculation of central excise duty on biogas mixed compressed natural gas (CNG).
–IANS
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