India has granted temporary customs duty relief for goods manufactured in Special Economic Zones (SEZs) and sold domestically. The reduced duty rates, ranging from 5% to 12.5%, will apply from April 1, 2026, to March 31, 2027, benefiting businesses that commenced production by March 31, 2025. This initiative aims to boost the local economy by making domestically produced goods more competitive against imports.

The relief is expected to provide significant cost reductions for businesses operating within SEZs, particularly in industries such as industrial chemicals and fertilizers, where duties on certain products have been cut to 6.5% from 7.5%. This move is part of broader efforts to enhance industrial growth and drive economic recovery .

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The government has also announced a one-time concession allowing eligible SEZ manufacturing units to sell domestically at a reduced duty rate, aimed at assisting exporters coping with rising U.S. tariffs and geopolitical uncertainty. This measure is expected to benefit labour-intensive sectors like textiles, leather, and footwear, as well as strategic areas like defence and space.

Customs Duty Relief for SEZ Goods