The Indian government announced the removal of basic custom duties (BCD) on cobalt powder and waste, lithium-ion battery scrap, lead, zinc, and 12 other critical minerals in its 2025-26 fiscal year Union Budget. This action significantly aims to reduce raw material costs for India’s domestic recycling industry. Consequently, it seeks to enhance competitiveness and stimulate new capacity investments.
Strategic Moves to Enhance Domestic Mineral Availability
Specifically, they included antimony, beryllium, bismuth, cobalt, cadmium, molybdenum, rhenium, tantalum, tin, tungsten, zirconium, and copper among the 12 additional exempted critical minerals. The government aligned this decision with its recent approval of $1.88 billion in funding for the National Critical Mineral Mission. This mission aims to ensure a sustainable long-term supply of these vital materials. Moreover, this marks the second consecutive year they implemented a critical mineral security program.
Union Minister for Mines, GK Reddy, stated that this policy will enhance domestic availability. It will do this by facilitating the recovery of valuable critical minerals from mining tailings. Furthermore, this will bolster strategic domestic industries, which include clean energy, semiconductors, defense, and space sectors. Additionally, they expect investments in research and development for efficient recovery processes to strengthen India’s self-reliance in critical mineral supply chains.
Policies to Reduce Battery Production Costs and Expand EV Industry
The ministry also proposed adding 35 capital goods for electric vehicle (EV) manufacturing and 28 capital goods for mobile phone battery production. They aim to lower battery production costs and boost lithium-ion battery production for mobile phones and EVs. Therefore, the government anticipates that these additions will make domestically produced EVs more affordable. Also, they want to encourage the country’s EV industry expansion by reducing operational costs. Notably, companies can import additional capital goods under the Export Promotion Capital Goods Scheme, such as machinery, without custom duties for export production.
Status Quo for Key Metals; Tariff Revisions for Stainless Steel
However, the duty structure for primary aluminum, nickel, and silicon metals remains unchanged. This persists despite repeated requests from the Indian industry for reductions.
Additionally, the Indian government revised the tariff rate on flat-rolled stainless steel products of 600mm or more in width. They lowered it to 15pc from 22.5pc. Similarly, they reduced duties on other tubes or pipe fittings of stainless steel to 15pc from 25pc in the 2024-25 fiscal year. SuperMetalPrice considers these policy changes significant for the domestic and international metals market, particularly in relation to the growing EV and battery sectors.
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