Services of exploration, mining or drilling of petroleum crude or natural gas or both, witness a GST rate revision from 18 percent to 12 percent. In the coal mining industry, this will improve the inverted-duty structure situation a bit
This was an even-keel kind of budget without any significant takeaways for the metals and mining industry.
Continued thrust on Pradhan Mantri Awas Yojana (PMAY), Jal Shakti, Jal Jeevan, Bharatmala, Sagarmala, UDAAN, Jal Marg Vikas projects, and public-private-partnership (PPP) in railway infra development will sustain business-as-usual growth of the metals and mining sector.
The Economic Survey of India unveiled on July 04, laid special importance on renewable sector growth, and growth of electric vehicles, etc.
The Survey, however, maintained that thermal power would continue to contribute 60 percent of the power generation. Thus, it has been maintained that coal mining would continue its charted path of capacity addition.
In the metals space, customs duty on gold and other precious metals has been hiked from 10 percent to 12.5 percent. The government has focused on incentivising domestic value addition by reducing customs duty on inputs and raw materials for the following:
Additionally, certain changes have been made in customs duty to provide level playing field to the domestic industry. Below table provides the details:
Base metal fittings, mountings and similar articles suitable for furniture, doors, staircases, windows, blinds, and hinges for automobiles have been proposed rate of duty at 15 percent, up from 10 percent.
On the goods and services tax (GST) front, rates have been reduced for various services to support economic activity.
Services of exploration, mining or drilling of petroleum crude or natural gas or both, witness a GST rate revision from 18 percent to 12 percent. In the coal mining industry, this will improve the inverted-duty structure situation a bit.
(The author is Partner – Mining and Metals, KPMG in India.)Disclaimer: The views and investment tips expressed by investment expert on moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.