The government on Thursday removed customs duty and health cess till September on ventilators, coronavirus testing kits and other medical supplies to increase domestic availability of these products to fight the COVID-19 pandemic.
With the removal of the duty and cess, prices of these products that include personal protection equipment and face and surgical masks would also come down.
"In the context of COVID-19 situation, considering the immediate requirement of ventilators and other items, the central government has granted exemption from basic customs duty and health cess, on the import of these goods, with immediate effect," the Department of Revenue said in a statement.
These exemptions will also be applicable on inputs used to manufacture these items.
"This basic customs duty exemption shall be available up to the September 30 this year," it said.
Currently, there is a 10 per cent duty on ventilators, and test kits; and 7.5 per cent on face and surgical masks. It ranges from 7.5 per cent to 10 per cent on PPE. Health cess is flat 5 per cent on all these goods.
With the number of COVID-19 patients increasing, there is a significant rise in demand for these items in the domestic market.
India has already restricted exports of diagnostic kits to discourage outbound shipments. The government has also banned exports of all kinds ventilators, sanitisers, and textile raw materials for masks and coveralls. These all moves are aimed at maintaining the availability of these goods in India.
Commenting on the move, Abhishek Jain, Tax Partner, EY said: "This was a much anticipated and a welcome exemption given the dire need of these goods to fight COVID 19 in India".
According to trade experts, China is a major supplier of these goods in the world.