Heavy Industry Ministry plans to reduce customs duty on electric vehicle parts

Heavy Industry Ministry plans to reduce customs duty on electric vehicle parts

– Heavy Industry Ministry has proposed reducing duty on electric vehicle parts 

– Currently parts including metals and plastics attract 28 per cent basic customs duty 

– The ministry has suggested defining semi-knocked down and completely knocked down kits

 

The Heavy Industries Ministry has proposed reducing customs duty on electric vehicle parts. Currently, the electric vehicle parts are not exempted from import tariff to the Department of Revenue. At present, key components for EVs, including battery, controller, charger, converter, energy monitor, electric compressor and motor, attract zero customs duty. On the other hand, parts including metals and plastics attract 28 per cent basic customs duty.  

 

In an effort to boost the production of electric vehicles (EVs) in the country, the ministry has suggested defining semi-knocked down and completely knocked down kits which are used for assembling EVs for streamlining of customs duty. The Heavy Industries Ministry has proposed a one-year sunset clause to the Finance Ministry along with the Rs 5,500 crore Fame India scheme that entails subsidies for all categories of electric vehicles, strong hybrid cars and for establishing charging infrastructure.

 

The policy to boost EV adoption in the country will also entail a long-term road-map and vision to encourage domestic manufacturing of lithium-ion batteries. Moreover, the Heavy Industries Ministry has also reportedly drawn up the blueprint for the second phase of FAME India scheme and received the nod for sanction of Rs 5,500 crore from the expenditure finance committee (EFC) under the Finance Ministry in September.

[“source=moneycontrol].