India Waives Duties on Critical Minerals in 2024-25 Budget

In a strategic move to bolster key industrial sectors, India has announced the reduction or elimination of custom duties on 25 critical minerals, including lithium, copper, cobalt, and rare earths. However, the government will maintain its tax on copper scrap. This announcement was made by India's finance minister, Nirmala Sitharaman, during her 2024-25 fiscal year budget speech.

The full list of the 25 critical minerals has not been disclosed, but these minerals are deemed essential for industries such as nuclear energy, renewable energy, space, defense, telecommunications, and high-tech electronics. Of these 25 minerals, 23 will be fully exempt from custom duties, while the remaining two will see a reduction in duties.

Additionally, India is launching a critical mineral mission to strengthen the supply chain for these essential minerals, encouraging both private and public sectors to enhance their long-term competitiveness.

The budget also includes significant reductions in customs duties on precious metals. Duties on gold and silver have been lowered to 6%, and platinum to 6.4%. Furthermore, the basic customs duty on ferro-nickel, crucial for stainless steel production, has been waived to improve domestic production efficiency.

The duty on copper scrap remains at 2.5%, but the duty on blister copper has been reduced to zero from 2.5%. This measure aims to support the domestic copper industry by lowering import costs.

In its efforts to support environmental goals, the government has continued the zero customs duty on ferrous scrap and nickel cathode, aligning with its commitment to achieving net-zero carbon emissions. A new carbon market will also be established to aid the steel and cement sectors in reducing their greenhouse gas emissions. The government plans to launch this domestic compliance carbon market by the end of the year to help industries meet their emissions intensity targets.