Capital Goods means any plant, machinery, equipment or accessories required for manufacture or production, either directly or indirectly, of goods or for rendering services, including those required for replacement, modernization, technological up-gradation or expansion.
Budget Focus on Capital Goods
- Infrastructure Engine: Increased public capex by ~9% to ₹12.2 lakh crore in FY 2026–27 aimed at increased inland shipping and expanding high-speed rail corridors.
- High-Tech Tool Rooms: Establishment of CPSE-led hi-tech tool rooms to locally design and manufacture high-precision components at scale.
- CIE Scheme: Launch of the Scheme for Enhancement of Construction and Infrastructure Equipment (CIE) to boost indigenous production of tunnel-boring machines.
- Logistics Boost: Outlay of ₹10,000 crore for a new Container Manufacturing Scheme to reduce import dependency and logistics costs.
- Duty Exemptions: Extension of Basic Customs Duty (BCD) exemptions for capital goods used in Lithium-ion cell manufacturing and critical mineral processing.
- Income tax exemption: For a period of five years to any non-resident entity that provides capital goods, equipment or tooling to a toll manufacturer operating in a bonded zone.
Recent Policy Support Strengthening Capital Goods Sector
- PLI Schemes: Production-Linked Incentives driving technology adoption & scale.
- Scheme for Enhancement of Competitiveness in the Indian Capital Goods Sector: Focusing on advanced Centers of Excellence and testing infrastructure.
