Customs duty exemption on lithium batteries to aid EV infra creation: Industry

Customs duty exemption on goods used to produce lithium batteries would enable the creation of a robust electric vehicle infrastructure in the country, automobile industry body SIAM said on Sunday.

Finance Minister Nirmala Sitharaman, while delivering the Budget speech, proposed to extend the basic customs duty exemption given to capital goods used for manufacturing lithium-ion cells for batteries, to those used for manufacturing lithium-ion cells for battery energy storage systems too.

“Continued exemption of basic customs duty on capital goods used for manufacturing lithium-ion batteries, along with the extension of concessional duty benefits for lithium-ion cells and their parts used in manufacturing batteries for electric and hybrid vehicles for a further two years till March 2028, will enable creation of a robust EV ecosystem in the country,” SIAM President Shailesh Chandra said in a statement.

The Union Budget 2026 “27 continues to focus on long-term, sustained economic growth with a strong emphasis on manufacturing, infrastructure, including freightcorridors and waterways and fiscal prudence, he added.” The decision to raise the capital expenditure target to Rs 12.2 lakh crore for 2026-27 from Rs 11.2 lakh crore in the current year will provide a strong impetus to demand creation and industrial activity, including the automobile sector,” Chandra stated.