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CHEMEXCIL
Basic Chemicals, Cosmetics & Dyes Export Promotion Council
(Set-up by Ministry of Commerce and Industry, Govt of India)
Jhansi Castle, 4th floor, 7-Cooperage Road, Mumbai - 400 001.
Tel :+91-22-69821200 to 206 Fax No : 22-69821226 / 37
Twitter : @chemexcil
E-mail: info@chemexcil.in
Website: http://www.chemexcil.in
EPC:LIC:UNION BUDGET:2025-26:PW:MISC 02 3rd February 2025
To
ALL THE MEMBERS OF THE COUNCIL
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UNION BUDGET 2025-26:- Highlights for Chemicals/ Exports
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Dear Members,
As you are aware, Union Budget 2025-26 has been presented by Hon’ble Minister of Finance Smt. Nirmala Sitharaman on 1st February 2025 at 11.00am.
In this regard, we would like to submit Highlights/ impact on Chemical sector as follows:
1. Budget-2025-26, broadly focused on transformative reforms across following six domains
i. Taxation
ii. Power sector
iii. Urban development
iv. Mining
v. Financial sector
vi. Regulatory reforms
2. This budget aims to
• Accelerate growth
• Secure inclusive development
• Private investment
• Uplift household sentiment
• Enhance spending power of India’s rising middle class
3. Following are the engines of development
1. Agriculture,
2. MSMEs,
3. Investments, and
4. Exports.
4. Announcement
a. Investment and turnover limits for MSMEs increased by 2.5 to 2 times respectively.
b. Well-performing exporter MSMEs will have access to term loans up to ?20 crore to boost their business expansion.
c. Enhanced credit guarantee cover to MSMEs including Start-ups.
d. A new scheme will be launched for 5 lakh women Scheduled Caste and Schedule Tribe first-time entrepreneurs.
e. Customized credit cards for micro industries with limit of Rs 5 lakh. In the first year, 10 lakh such cards will be issued.
f. Setting up of a National Manufacturing Mission for small, medium and large industries to help Make in India initiative.
g. Announcement of set up Rs 25,000-crore Maritime Development Fund will streamline the export process, making it more cost-effective, reliable, and efficient for exporters. Utilization of this fund is to develop better port facilities, reducing congestion and increasing the efficiency of shipping operations.
h. The BharatNet project, which aims to provide high-speed broadband connectivity to rural and remote areas, can have a significant positive impact on exports in India by improving digital access and services in rural regions
i. Establishment of an Export Promotion Mission, jointly led by the Ministries of Commerce, MSME, and Finance, focusing on Easy access to export credit, Cross-border factoring support, Addressing non-tariff barriers in overseas markets.
j. Development of a national framework to encourage Global Capability Centers (GCCs) in Tier-2 cities to boost trade infrastructure.
k. Sector-Specific Export Incentives for sectors such as Footwear & Leather, Handicrafts, etc. there is no specific announcement with regards to Chemical sector however duties on certain chemicals have been reduced to great extents which is as mentioned below.
5. Important custom changes for Chemicals are as under (Copy of notification enclosed)
a. Chapter 28:
i. The tariff rate is being reduced from 20% to 7.5% on Phosphoric Acid classified under tariff item 2809 20 10. This change will be effective from 1st May, 2025.
ii. The tariff rate is being reduced from 27.5% to 7.5% on Boric acid classified under tariff item 2810 00 20. This change will be effective from 1st May,2025
b. Chapter 29: The tariff rate is being reduced from 10% to 7.5% on all items falling under sub heading 2933 59 (Heterocyclic Compounds Containing A Pyrimidine Ring (hydrogenated Or Not) Or A Piperazine Ring In The Structure, Others) . These changes will come into effect from 1st May, 2025.
c. Chapter 33: The tariff rate is being reduced from 100% to 20% on synthetic flavoring essences and mixtures of odoriferous substances of a kind used in food and beverage industry, classified under sub heading 3302 10. This change will be effective from 1st May, 2025
d. Chapter 38
i. The tariff rate is being reduced from 30% to 10% on tariff sub heading 3822 90 covering Pharmaceutical Reference standard, Certified/ other reference materials. This change will come into effect from 1st May, 2025.
ii. The tariff rate is being reduced from 30% to 20% on Sorbitol classified under sub heading 3824 60. This change will come into effect from 1st May, 2025
iii. The tariff rate is being reduced from 17.5% to 7.5% on Other - Prepared Binders, chemical products and preparations of chemical or allied industries classified under tariff item 3824 99 00. This change will come into effect from 1st May, 2025.
6. Funds allocations in Schemes
1. Duty Drawback – Rs. 181.9 Cr.
2. Market Access Initiative Scheme- NIL
3. Interest Equalization Scheme- NIL.
4. RoDTEP- Rs. 18232.50 Cr.
Please note CHEMEXCIL is organizing a Webinar on "Post-Budget Analysis of Impact of Union Budget 2025-26 on Export/ Import with the Experts from Lakshmikumaran & Sridharan (L&S) on 4th February 2025 at 3.00pm. The joining link of the webinar will be shared separately
For further details please use below links.
https://www.indiabudget.gov.in/doc/Budget_Speech.pdf
https://www.indiabudget.gov.in/doc/Key_to_Budget_Document_2025.pdf
https://www.indiabudget.gov.in/doc/bh1.pdf
Feed-backs, if any may also be sent to the council on e-mail ids:- pw@chemexcil.in and dg@chemexcil.in records/ further deliberations, if required.
Thanking you,
Abhay Udeshi
Chairman
CHEMEXCIL
Encl : dojstru1
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