Govt. exempts Customs Duty for 40 petrochemical products

The Union government has provided full Customs Duty exemption for about 40 petrochemical products till June 30 in view of the ongoing conflict in West Asia.

A notification dated April 1, 2026, listed 40 items, including polypropelene, polystyrene, polyols , poly butadiene, styrene butadiene and anhydrous ammonia.

“This measure has been taken as a temporary and targeted relief in order to ensure continued availability of critical petrochemical inputs for domestic industry, reduce cost pressures on downstream sectors, and safeguard supply stability in the country,” said an official press statement.

It will benefit a wide range of sectors dependent on petrochemical feedstock and intermediates, including plastics, packaging, textiles, pharmaceuticals, chemicals, automotive components, and other manufacturing segments.

Sanjay Mangal, Member at the Central Board of Indirect Taxes and Customs (CBIC), said the revenue loss would be around ₹1,800 crore for the next three months. Cautioning that the dynamics are constantly evolving and the estimates are based on past trends, he said, “While we are looking at the losses, we must note this is on the basis of past trends, and considering the present dynamics of crude, the exact revenue [foregone] impact cannot be calculated in that manner.”

According to Anil Reddy Vennam, senior vice-president of the All India Plastic Manufacturers Association, almost 25 % of the raw material for the plastic industry is imported, mainly from west Asia. With complete exemption of the 8.5 % import duty, the plastic industry should see some relief. The raw material prices went up 65 % in the first 15 days of the U.S., Israel, Iran war. The latest revision was on April 1. With 90 % of the Indian plastic manufacturers in the MSME sector and 50,000-75,000 industries in the organised sector, the manufacturers look forward for reduction of raw material prices now, he said.

R.K. Vij, president of the Textile Association (India), said Purified Terepthalic Acid (PTA) and Mono Ethylene Glycol (MEG) are main raw materials for the synthetic textile industry, and the melt saw 43% jump in price in the last one month because of the war. The cost of the melt went up from ₹83 a kg to ₹118 a kg. “The manmade fibre sector is a growing field and this (Customs Duty waiver) is a very good move. We can get PTA from the US and China now. Saudi Arabia and Kuwait are the main suppliers for MEG and there will be a shortage of this product,” he added.