Looking to give a leg up to domestic manufacturing, the budget has rolled back several exemptions and concessions of customs duties on import of goods that are also being manufactured in India.
“More than 350 exemption entries are proposed to be gradually phased out,” finance minister Nirmala Sitharaman said in her Budget speech.
The exemption list includes agricultural produce, chemicals, fabrics, medical devices and drugs and medicines – items that can be locally manufactured.
The Budget has proposed to phase out the concessional rates in capital goods. The finance minister added that these exemptions had hindered the growth of the domestic capital goods sector.
The move is aimed at helping the National Capital Goods Policy, which seeks to double the production of capital goods by 2025.
Phased exemption on project imports and applying a moderate tariff of 7.5% will provide a level playing field to local players in coal mining projects, power projects, railway and metro projects.
However, the budget kept some exemptions, including customs duty exemption on steel scrap extending it by one more year to provide relief to the secondary steel producers in the MSME sector.
The budget revoked anti-dumping duty (ADD) and countervailing duty (CVD) on stainless steel and coated steel flat products, parts of alloy steel, and high-speed steel, considering prevailing high prices of metals, in a move that would aid industries such as automobile and construction.
It also retained customs duty on machine parts, which cannot be manufactured in India or can boost domestic manufacturing like specialised castings, ball screws and linear motion guide.
To address the issue of leakage of sensitive information of exporters and importers, a clause has been added in Customs Act that makes publishing of such information a punishable offence. Any information leaked relating to the value or quantity or details of an importer or exporter will now attract imprisonment up to six months or a fine up to ₹50,000, or both.
Experts said the measures are aligned with the Make in India scheme and to cut dependency on imports of items which can be locally manufactured easily.
Source : Economic Times
