NEW DELHI, Feb 3:
India has significantly reduced its average customs duty rate to 10.66 per cent from 11.65 per cent and is now moving towards the same levels as prevalent in the Southeast Asian countries, a senior government official said on Monday.
CBIC (Central Board of Indirect Taxes & Customs) Chairman Sanjay Kumar Agarwal said the rate rationalisation exercise was carried out with the objective of making the tariff structure simple, ensuring competitiveness of Indian industry and simplifying the tax regime.
“Now the average customs rate in India has come down from 11.65 per cent to 10.66 per cent and we are now moving towards the average rate in ASEAN countries,” he said here at an interaction with industry representatives.
The 10-nation bloc ASEAN (Association of Southeast Asian Nations) countries are Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam.
The exercise was also important for dispelling the narrative of developed countries like the US that India has one of the highest tariffs.
The US President Donald Trump’s administration has accused India of being “tariff king” and “tariff abuser”.
He noted that in the high duty brackets from 25 per cent to 150 per cent, only a few products are available in the country.
“There are very few items on these high rates…rates are otherwise in the narrow band of zero to 10 per cent,” he said, adding that steps have also been announced in the Budget 2025-26 in this direction.
The government has rationalised basic customs duty rates, slashing the number of levies to just 8, but has kept the effective duty rates on most items the same by adjusting cess to further ease of doing business.
Union Finance Minister Nirmala Sitharaman removed seven tariff rates in the 2025-26 Budget. This is over and above the seven tariff rates removed in the 2023-24 budget.
After this, there will be only eight remaining tariff rates, including a ‘zero’ rate to further ease of doing business.
This rationalisation is designed to simplify the tariff structure, enhance trade competitiveness, and support India’s integration into global supply chains, he added.
Further, he said the thrust in the budget was to ensure adequate availability of the items which are critical for manufacturing in the country like critical minerals.
These minerals, he said, are required for manufacturing areas like semiconductors, for transitioning to clean energy and for space programmes.
These minerals are not available in the country and they are imported. In the last budget also, the duties were brought down on these critical minerals.
The rates on the waste and scrap of these minerals were brought down to nil so that recycling of such waste can be done in the country to make the availability of these minerals in the country, he added. (PTI)
The post India’s avg customs duty cut to 10.66% from 11.65%, now moving towards ASEAN level: CBIC appeared first on Daily Excelsior.