Finance Minister Nirmala Sitharaman presented the Union Budget 2024-25 in the parliament today. The Union Budget envisaged nine priorities for generating ample opportunities, Productivity and Resilience in Agriculture, Employment and skill, Inclusive Human Resource Development and Social Justice, Manufacturing and Service, Urban Development, Energy Security, Infrastructure, Innovation, Research and Development, and Next-Generation reforms.
What items will get cheaper?
Following the Union Budget 2024 announcement by Finance Minister Nirmala Sitharaman, several items are expected to become cheaper due to reductions in customs duties and exemptions. Here are some key items that will see price decreases:
● The reduced customs duties on gold and silver to 6%, and on platinum to 6.5%, are anticipated to stimulate retail demand and mitigate smuggling, thereby supporting growth in the gems and jewelry sector.
● The government has decreased the basic customs duty (BCD) on mobile phones, mobile printed circuit board assembly (PCBA), and mobile chargers from 20% to 15%. This reduction is aimed at enhancing consumer affordability, bolstering the ‘Made In India’ manufacturing sector.
● The three cancer drugs exempted from customs duty are Trastuzumab Deruxtecan, Osimertinib, and Durvalumab.
● The finance minister suggested a complete exemption from customs duties for 25 critical minerals, including lithium, copper, cobalt, and rare earth elements, essential for sectors such as nuclear energy, renewable energy, space, defense, telecommunications, and high-tech electronics. Additionally, the basic customs duty on two of these minerals will be reduced.
● The government intends to broaden the list of exempted capital goods used in the manufacturing of solar panels, aiming to lower costs within this sector.
● Customs duties on manufacturing leather and footwear have been reduced, promoting domestic production.
● Basic customs duty on ferronickel and blister copper to be removed.
● The government has announced a reduction in the customs duty on specific brood stocks, shrimps, and fish feed to 5%. In response, shares of companies engaged in producing and exporting seafood products experienced a significant increase.
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What will get costlier?
In the wake of the Union Budget announcement, several items are slated for price increases due to higher customs duties. Here’s an overview of the main items affected:
● The government has proposed to increase import duty on motherboards, technically called printed circuit boards, by 5% in the Union Budget 2024-25 to boost domestic telecom gear manufacturing.
● The customs duty on non-biodegradable plastics has been raised to 25% as part of an initiative to reduce imports of these products.
● The customs duty on ammonium nitrate will be increased to 10% from the current 7.5% starting July 24, aiming to bolster both existing capacities and those in development.
● The minister said the customs duty on polyvinyl chloride (PVC) flex films and banners will increase from the current 10% to 25%, to limit their importation.
Budget overview
The Union Budget 2024 aims to benefit various groups, including the middle class, farmers, women, and youth. The revised tax structure introduces significant relief for middle-income earners, while increased allocations for agriculture (₹1.52 trillion) and women-centric schemes (₹3 trillion) support rural and female empowerment.
Additionally, new employment-linked initiatives with a ₹2 trillion allocation focus on skilling 20 lakh youth. Overall, the budget emphasizes economic growth, social welfare, and job creation, positioning it as a comprehensive plan for inclusive development.
Written by – Siddesh S Raskar
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