New Delhi: The Centre has exempted 40 critical petrochemical feedstocks and intermediates from customs duties until June end to shield domestic industries from supply issues caused by the Iran war, the Finance Ministry announced on Thursday.
This includes vital inputs such as ammonia, which plays a key role in fertilizer production and supports India’s food security needs.
The ministry described the action as a “targeted relief” aimed at guaranteeing the steady flow of essential petrochemicals, lowering costs for downstream businesses, and maintaining stability amid the ongoing conflict in West Asia.
“This measure has been taken as a temporary and targeted relief in order to ensure continued availability of critical petrochemical inputs for domestic industry, reduce cost pressures on downstream sectors, and safeguard supply stability in the country,” it said.
Sectors like plastics, packaging, textiles, pharmaceuticals, chemicals, and automotive components will gain the most, as they rely on these materials for products ranging from medicines and paints to adhesives, polyester fabrics, disinfectants, detergents, bottles, and electronics.
The waiver will also help to prevent the war from driving up inflation inside India, since experts warn that global supply chain breaks could raise prices and interest rates everywhere.
India’s consumer price index (CPI) inflation climbed to 3.21% in February from 2.74% in January, pushed higher by costs of precious metals, personal care items, and some food products; March figures are due mid-April.
By reducing input expenses, the move helps Indian manufacturers remain competitive even as international trade suffers from the conflict and new US tariffs.
In its February monthly economic review, the finance ministry noted that the war could significantly affect growth, inflation, fiscal balances, and external accounts, while highlighting “considerable downside risks” to the FY27 growth projection of 7-7.4%.
Last month, the government reduced import duties on petrol and diesel, and added export taxes on jet fuel and diesel, all to ease strain on oil retailers, protect consumers from price hikes, and ensure enough fuel stays in the country.
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