In the Federal Budget effective April 1, India announced reductions in customs duties on high-end motorcycles, cars, and smartphone parts. This move aims to boost the import of American products, such as Harley-Davidson motorcycles, Tesla electric vehicles, and Apple smartphones. Finance Minister Nirmala Sitharaman stated that the custom duty rationalization is part of an effort to make the Indian economy more self-reliant and to strengthen its foundation as a manufacturing hub.
The import duty on high-end motorcycles with engine capacities up to 1,600 cc, which are imported as completely built-up (CBU) units, has been reduced from 50% to 40%. The import duty on semi-knocked down (SKD) kits has been slashed from 25% to 20%, and the completely knocked down (CKD) units will now be taxed at 10%, down from 15%. These changes are expected to boost the import of Harley-Davidson motorcycles into India, which had faced high tariffs and led to the company’s exit from the Indian market in 2020. However, Harley-Davidson returned to India through a partnership with MotoCorp Ltd, which now makes and sells the Harley-Davidson 440X.
In addition to motorcycles, the budget announced a reduction in the tariff rate on luxury cars priced above $40,000 from 125% to 70%. Basic customs duties on lithium-ion batteries for electric vehicles (EVs) have been completely scrapped. This move is expected to incentivize American EV companies such as Tesla, which has shown interest in the Indian market.
The budget also includes exemptions on customs duties for 28 items used in mobile phone battery production, benefiting companies such as Apple. This measure is aimed at reducing the cost of mobile phones and accessories in India while boosting local production. India is steadily evolving into the world’s second-largest mobile phone manufacturer, and American companies such as Apple are expected to benefit significantly from these import tax cuts. According to a Reuters report, Apple captured a 23% share in total revenue in 2024, and the import tax cuts will help India manage an otherwise unpredictable year.
Last updated: December 26th, 2025
