India's 2024-25 Fiscal Budget: Major Duty Reforms to Boost Solar Manufacturing

India's Finance Minister Nirmala Sitharaman presented the 2024-25 fiscal budget on July 23. The budget aims to promote the development of the manufacturing industry by announcing the exemption of basic customs duty on specific machinery/equipment used for manufacturing solar cells and modules. Previously, the duty on these products was 7.5%. This exemption will reduce the costs for manufacturers of solar cells and modules.

The scope of the import duty (BCD) exemption has been expanded to include specific goods used for manufacturing silicon wafers, specific materials used for manufacturing EVA (ethylene-vinyl acetate) sheets, and flat copper wires used for manufacturing photovoltaic ribbons. These goods are now exempt from import duties, with the exemption valid until March 31, 2026. Additionally, the range of importable materials is being expanded.

On the other hand, solar glass used for manufacturing solar cells/modules will be subject to a 10% duty starting October 1 this year. Tin-plated copper interconnects used for manufacturing solar cells/modules will also be subject to a 5% duty starting October 1.