Fueling Self-Reliance: India’s Push for Lithium-Ion Battery Manufacturing

February 22, 2025

The Union Budget 2025 has introduced a significant push for domestic manufacturing and value addition, particularly in the lithium-ion battery sector. With a growing emphasis on electric mobility and self-reliance, Finance Minister Nirmala Sitharaman announced the addition of:

35 new capital goods under customs tax exemption for EV battery manufacturing
28 new capital goods under the exemption for mobile phone battery manufacturing.

"In a major boost to domestic manufacturing, the government has extended customs duty exemptions to an additional 64 capital goods, which were previously subjected to Basic Customs Duty (BCD) ranging from 7.5% to 15%. With this exemption, manufacturers can now access these essential goods at lower costs, fostering greater investment, technological advancement, and local value addition in India’s rapidly growing battery and electronics sectors."

Here is the list of capital goods exempted fully along with a notification snapshot:

28 new capital goods under the exemption for mobile phone battery manufacturing.
Sr. No.	Name of Capital Goods	Sr. No.	Name of Capital Goods
1	Auto-taping machine	15	Film / Myler tearing machine
2	Auto-packing machine	16	Auto unloading Machine
3	Mylar sticking machine	17	Mylar slitting machine
4	Auto magazine load machine	18	Foil slitting machine
5	Constant temperature capacity machine	19	Dust collector
6	Separator coating machine	20	Electrode packing machine
7	Roller cleaning machine	21	Electrode rewinding machine
8	Formation machine	22	Calendar printing machine
9	Automatic tapping machine	23	Electrolyte tapping machine
10	Stacking machine	24	Strip Tape machine
11	Separator trimming machine	25	Mixing or agitating substances machine
12	Tab transfer welding & winding machine	26	Aluminum foil bag edge cutting machine
13	Ultrasonic Tray cleaning machine	27	Ultrasonic cleaning machine
14	Gasket automatic cleaning machine	28	Cell slicing machine

35 new capital goods under customs tax exemption for EV battery manufacturing
S.No.	Name of Capital Goods	S.No.	Name of Capital Goods
1	Solvent Recovery System	19	2nd Helium Test System
2	Heat Recovery System	20	Wire Feeding and Rework Machine
3	Effluent Treatment System	21	Cell Aging Machine
4	Electrolyte Injection Machine	22	Negative Pressure Formation
5	Helium Injection Machine	23	Cell Formation - Cell Capacity and SOC
6	Nail Inserting Machine	24	Cell Formation - DCIR
7	Nail Pulling Machine	25	Cell Formation - Cell Tray Plastic
8	Injection Hole Cleaning Machine	26	Cell Formation - Cell Tray
9	Cell Baking & Cooling Machine	27	Cell Formation - Metallic Formation Machine
10	Jelly Roll Pairing Machine	28	Cell Formation - Other Trays
11	Mylar Wrapping Machine	29	Film Wrapping and Final Inspection
12	Cell Sorting Line	30	Tap to Top Cap Welding
13	Laser Pin Welding	31	Fibre Temperature Detection System
14	Laser Notching & Winding	32	Water Sprinkler System
15	Ultrasonic Welding	33	Rack
16	Load in Can	34	Tape Coding
17	Top Cover Laser Welding	35	Wire Filling and Welding Machine
18	1st Helium Test System	35	Wire Filling and Welding Machine

This strategic move is set to enhance India's production capabilities, reduce import dependency, and drive innovation in the clean energy ecosystem.

Key Benefits of the Policy

Encouraging Local Production:
The exemption lowers manufacturing costs, making India a competitive hub for battery production.

Strengthening the EV Ecosystem:
Affordable lithium-ion batteries will accelerate EV adoption and promote sustainable transportation.

Attracting Investments & Generating Employment:
Lower costs and improved infrastructure will bring in global investors and create new jobs in the sector.

Enhancing Technological Innovation:
Encouraging domestic R&D in battery technology for longer-lasting, more efficient, and cost-effective solutions.

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