Budget 2025: In a major push to enhance India’s electric vehicle EV and clean energy sectors, Finance Minister Nirmala Sitharaman announced significant tax exemptions aimed at promoting the production of lithium batteries and related technologies. The government has removed the Basic Customs Duty BCD on essential materials such as cobalt, lithium-ion battery scrap, lead, zinc, and 12 other critical minerals required for manufacturing batteries, semiconductors, and renewable energy equipment. This move is expected to lower production costs for industries reliant on these materials, including electric vehicles, electronics, and clean energy technologies.
In addition, the government has made 35 items used in EV battery production and 28 items for mobile phone battery manufacturing duty-free, which will allow companies to import machines and tools for battery production without additional tax burdens. This initiative is designed to foster the growth of local battery production, reduce India’s reliance on imports, and encourage leading companies like Tata, Ola Electric, and Reliance to expand their operations within the country.
The tax exemptions are expected to result in cheaper EV batteries, making electric vehicles more affordable for consumers, and driving growth in India’s manufacturing sector. This will not only help reduce dependence on imports from countries like China but also support India’s renewable energy goals and enhance the competitiveness of the domestic industry.
Indrani Priyadarshini is a journalist and editorial professional specialising in technology, artificial intelligence, smart cities, green energy, and digital transformation. With over four years of experience in tech journalism and digital media, she is known for turning complex industry developments into clear, engaging, and insightful stories. Her expertise spans reporting, editorial strategy, digital publishing workflows, and in-depth coverage of emerging technologies shaping the future. She has also conducted high-profile interviews and podcasts with industry leaders, bringing sharp analysis and accessible storytelling to a wide audience.
