Centre Exempts Customs Duty on 18 Defence Imports Including Aircraft and Missiles

The Central Government has announced a customs duty exemption on 18 high-end defence imports, effective from September 22, 2025. This initiative is aligned with broader tax reforms under GST 2.0 and aims to support the modernisation of India's defence sector.

Major Defence Items to Receive Customs Duty Relief

The duty exemption covers 18 defence-related items, including military transport aircraft, ship-launched missiles exceeding 100 mm in calibre, unmanned underwater vehicles, and high-performance batteries for drones. The list also includes flight motion simulators, deep submergence rescue vessels, and parts, spares, and tools for artillery systems, rifles, and aircraft.

The relief is designed to lower operational costs and enhance the timely acquisition of critical military hardware. With ongoing tensions and the need for up-to-date warfighting capabilities, this relaxation streamlines procurement and aids indigenous manufacturing by complementing it with necessary imports.

Broader Tax Reforms and Defence Alignment

This move falls under a larger GST overhaul strategy discussed during the GST Council meeting on September 3, 2025. As part of GST 2.0, the Council restructured multiple tax slabs and introduced a simplified 5% slab for daily-use goods. Meanwhile, luxury items like SUVs and yachts were pushed into higher taxation brackets.

By exempting specialised defence imports from customs duty, the government underscores its dual focus on bolstering security preparedness and managing overall economic equity through rationalised taxation.

Read More: India Unveils DPM 2025: Streamlined Defence Procurement and Faster Decision Making!

Exclusions and Specific Provisions

While several items qualify for exemption, some domestic systems have been deliberately excluded. These include the 12.7 mm SRCG, 155mm/45 Cal Dhanush, and 84mm RL Mk-III, among others. This helps in protecting and encouraging local production capabilities while importing only what is essential and unavailable domestically.

Conclusion

By exempting customs duties on strategic military imports, the government is ensuring better defence preparedness and aligning its tax reforms with national security objectives. This tariff relief, complemented by GST restructuring, signals an integrated economic and defence strategy.

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