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CBIC Implements Customs Duty Cuts for Nuclear, Defence, and Critical Minerals to Boost Manufacturing Competitiveness

EconomyPolityHIGH
Target:UPSC GS-IIIMPSCSSC GATeachingPrelims HighMains MediumStatic GK Link
05 Feb 2026
~2 min
Source: Indian Express
Key Data:Composite duty Rs 60 per piece or 20%Duty-free input limit raised from 1% to 3%WHO recommends 75% excise incidence on cigarettesDuty-free baggage limit raised to Rs 75,000Gold/silver weight limit: 40g (women), 20g (others)460 SEZs shut in 5 years
Bodies:CBICWHOWorld BankDepartment of RevenueDepartment of Commerce
Practice MCQs from today's news ▸
What This Article Covers

1.CBIC Chairman explains customs duty cuts in Budget 2026 are strategic, aimed at making Indian industry competitive ahead of multiple FTAs.

2.Duty exemptions target nuclear power, lithium-ion batteries, monazite for EVs, and sodium antimonate for solar glass to enhance energy security.

3.Reforms include one-time measure for SEZs to sell domestically, higher cigarette duties aligned with WHO guidelines, and overhauled baggage rules.

The Big Picture
Prelims · HighMains · Medium

The CBIC Chairman clarifies that the Budget's customs duty cuts are not a revenue loss but a strategic industrial policy to boost local manufacturing competitiveness, especially in light of upcoming FTAs. Key interventions span nuclear energy, critical minerals, defence, MSMEs, and SEZs, with parallel reforms in tobacco taxation and baggage rules.

Exam Lens

Quick Exam Facts From News

Composite Duty for UmbrellasRs 60 per piece or 20%, whichever is higher
Seafood Processing Duty-Free LimitRaised from 1% to 3% of previous year's FOB value
New Baggage Duty-Free LimitRs 75,000 (Rs 25,000 for foreign tourists by air)
Gold/Silver Weight Limit40g for women, 20g for others (weight-based, not value)
SEZs Shut (Past 5 Years)Over 460

1-Minute Revision

  • ›Composite Duty for Umbrellas: Rs 60 per piece or 20%, whichever is higher
  • ›Seafood Processing Duty-Free Limit: Raised from 1% to 3% of previous year's FOB value
  • ›Target this Data: Duty-free baggage limit raised to Rs 75,000 (Rs 25,000 for foreign tourists by air).
  • ›Target this Nodal Body: Central Board of Indirect Taxes and Customs (CBIC) under Department of Revenue, Ministry of Finance.
  • ›Target this Legal Point: Transition from GST 1.0 compensation cess to imposition of additional duties over 40% slab under GST 2.0 for tobacco.

Mastered this topic? Test your knowledge with a full MCQ quiz.

Practice exam-style questions, track your score, and strengthen your recall.

Q1Static LinkageEasy

The Central Board of Indirect Taxes and Customs (CBIC) is a statutory body under which Ministry/Department?

Q2Statement-basedHard

Consider the following statements regarding the recent Union Budget's customs duty measures:

1. Duty exemptions for setting up nuclear power plants were announced with a specific capacity limit.

2. The duty-free input limit for the seafood processing industry was raised from 1% to 3% of the previous year's freight on-board (FOB) value.

3. A one-time measure was announced allowing Special Economic Zones (SEZs) to sell goods in the Domestic Tariff Area (DTA) at concessional duties.

Which of the statements given above is/are correct?

Q3Data-centricMedium

According to the news, what is the new duty-free baggage limit for passengers bringing goods into India?

Q4Application/ImpactMedium

What is the primary rationale, as explained by the CBIC Chairman, behind the recent customs duty cuts announced in the Union Budget?

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