Union Budget 2024: India scraps customs duty on 25 critical minerals

The finance minister added, "I propose to fully exempt customs duties on 25 critical minerals and reduce BCD on two of them"

The government on Tuesday announced the lifting of customs duty from 25 critical minerals and metals, including lithium and cobalt which are considered the building blocks of modern technology and also crucial to the ongoing green energy shift.

In her Budget speech, Union Minister Nirmala Sitharaman also announced a Critical Mineral Mission.

She also announced to cut basic custom duty on two minerals.

“I propose to fully exempt customs duties on 25 critical minerals and reduce BCD on two of them,” the Union minister said.

“To reduce their (steel and copper) cost of production, I propose to remove the BCD (basic custom duty) on ferro nickel and blister copper,” Sitharaman said.

Uday Narang, Founder and Chairman, Omega Seiki, an electric mobility company, said, “Exempting import duties on critical minerals, including lithium, cobalt and other minerals reduces battery manufacturing costs and makes electric vehicles more affordable.”

The finance minister also announced, “We will set up a Critical Mineral Mission for domestic production, recycling of critical minerals, and overseas acquisition of critical mineral assets. Its mandate will include technology development, skilled workforce, extended producer responsibility framework, and a suitable financing mechanism.”

Copper ores and concentrates presently attract a 2.5 per cent CBD.

Major producers in India, Hindalco Industries and latest entrant Adani’s Kutch Copper are likely to benefit from the latest duty cut, as they depend on imports of copper concentrates.