Budget offers relief to sectors stumped by Trump’s tariffs
Reduction of customs duty on input for export-led sectors, including energy storage, gives a boost to domestic industries reeling from US tariffs
Last Updated: Feb 02, 2026, 09:41 IST2 min
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Structural changes in customs, additional manufacturing measures and promoting India’s export competitiveness were at the centre of Union Budget for FY27.
The announcements address the tariffs imposed by US President Donald Trump on the import of Indian goods, with duties going up to nearly 50 percent for certain sectors, including gems, jewellery, textile, marine and chemicals. Finance minister Nirmala Sitharaman also announced sectoral measures for the impacted sectors.
“India will continue to take confident steps towards Viksit Bharat, balancing ambition with inclusion. As a growing economy with expanding trade and capital needs, India must also remain deeply integrated with global markets, exporting more and attracting stable long-term investment,” the finance minister said in her Budget speech.
The announcements across sectors simplifying compliance were aimed at improving India’s share in the global trade.
The Budget announced customs duty exemption given to capital goods used for manufacturing lithium-ion cells for battery energy storage systems to boost domestic manufacturing. The announcement also included customs duty exemption on sodium antimonate for use in manufacturing solar glass. Customs duty exemption on import of goods required for nuclear power projects till 2035, irrespective of the capacity of the nuclear reactor plant, also plays into the government’s agenda for energy security through the Shanti Act.
The overhaul of customs facilitation through a new Customs Integrated System as a single, integrated and scalable platform for all the customs processes, along with AI-aided risk assessment for scanning containers, is a big step.
“Major customs relief for critical minerals has been provided by extending customs duty exemptions to nuclear power projects, critical nuclear minerals, and bio-gas blended CNG… it is a positive move towards India’s clean energy transition and ecosystem,” says Gyanendra Tripathi, partner and leader-indirect tax (North & West) at tax and regulatory advisory BDO India.
The Budget also announced measures to promote exports of marine, textile and leather goods by promoting duty-free import of inputs. The limit for duty-free import of specific inputs for processing sea food products for export was increased to 3 percent from the current 1 percent of the FOB value of previous year’s export turnover. In addition, the time period for export of final product was increased to 1 year (from six months) for exporters of leather or textile garments, leather or synthetic footwear and other leather products.
Offering relief to SMEs which rely on courier-led exports, the removal of Rs10 lakh per consignment cap on courier exports brought much relief. “It creates the foundation for higher-value cross-border ecommerce, stronger unit economics and larger average ticket sizes for Indian exporters,” says Prachi Dharani, co-founder and CEO at PayGlocal, a global commerce payments platform.
Read Forbes India's complete Budget 2026-27 coverage here
First Published: Feb 02, 2026, 09:41
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