India consolidates customs exemptions for lithium-ion battery makers in fresh manufacturing push

India has consolidated separate customs exemptions for machinery used in lithium-ion cell manufacturing into a single technology-neutral exemption, according to Rajat Mohan, Managing Partner at AMRG Global. He said the move “simplifies the customs framework, removes end-use-based distinctions, and significantly reduces compliance and interpretational challenges for manufacturers,” and is expected to encourage new investment by giving manufacturers greater flexibility across integrated production facilities.

The change is part of a broader exemption announced by the Finance Ministry and the Central Board of Indirect Taxes and Customs, which also removes 7.5% and 5% basic customs duties on components used in wireless charging modules and display assemblies for smartphones and other electronic devices, valid until March 31, 2029.

According to a Reuters report, the exemption could cut input costs for companies including Xiaomi, Samsung and Apple. The changes are aimed at supporting India’s domestic electronics production ecosystem, building on initiatives such as the Production Linked Incentive scheme.

India is targeting a $500 billion electronics manufacturing sector by fiscal year 2030, with government data showing smartphone production in the country has grown 28-fold over the past decade to reach Rs 5.45 trillion (around $57 billion) in FY 2024-25.