Indian Union Budget 2025 introduces exemption on custom duties of components that will make mobile phones, TVs and electric vehicles cheaper

Finance Minister, Nirmala Sitharaman has presented the Union Budget 2025 today. The budget is said to focus on Agriculture, MSME, Investment, and Exports to drive the goal of Viksit Bharat. Exemptions on custom duties of a few components were announced which will be making few electronic gadgets and vehicles affordable while there was also a focus on AI Education, broadband connectivity expansion, and more.
Let’s dive in to learn all the details
Budget 2025: Technology and Electronic
It is announced that five National Centres of Excellence for Skilling and a new Centre of Excellence for AI in Education will be set up. Broadband connectivity will be expanded to all secondary schools and primary health centres across the country under the Bharat Net program.
A new Deeptech fund-of-funds is being explored by the government in order to boost research and development. Make in India initiative will be expanded to include a new manufacturing mission that will create an ecosystem for local production of components like rid-scale batteries, solar photovoltaic cells, and electrolyzers.
One of the major changes includes a reduction in BCD (basic customs duty) on mobile phones, chargers, and mobile printed circuit board assemblies (PCBAs) from 20% to 15%. This change is expected to lower the cost of imported smartphones and accessories. Custom duty on inputs/parts and sub-parts of PCBA, camera module, connectors, and inputs of raw materials for use in the manufacture of wired headsets, microphones and receivers, USB cables, and fingerprint readers/sensors of cellular mobile phones has been cut from 2.5% to Nil.
In her budget speech, the Finance Minister said, To the list of exempted capital goods, “I propose to add 35 additional capital goods for EV battery manufacturing and 28 additional capital goods for mobile phone battery manufacturing. This will boost domestic manufacture of lithium-ion batteries, both for mobile phones and electric vehicles.”
Custom duty on specified input/parts (chip on film, PCBA, glass board/substrate cell) for use in the manufacture of open cells of TV panels of LED/LCD TV has been fully exempted. Customs duty on cobalt products, LED, zinc, lithium-ion battery scrap, and 12 critical minerals has also been fully exempted.
BCD on interactive flat panel displays has been increased from 10% to 20% in order to address the inverted tariff structure. The allocation for semiconductor and display manufacturing schemes has been increased from Rs 1,500 crore (2023-2024) to Rs 6,903 crore (2024-2025). Additionally, the government has allocated Rs 6,200 crore for production-linked incentive schemes for electronics and IT hardware manufacturing.
These new amendments are expected to encourage domestic protection, attract foreign investment, and also make electronic products cheaper for Indian consumers. What are your thoughts on these new changes?