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Navigating Tax Challenges to Establish GCC in India

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India’s clean energy transition depends on advanced battery technologies.

Yet, under the current Customs framework, certain advanced technology batteries such as sodium-ion, redox flow, and multi-ion batteries which are environment friendly face significantly higher levies as compared to certain other batteries. This creates market distortions, discourages innovation, and raises costs for both manufacturers and end-users. At the same time, India’s growing battery demand and reliance on imports present serious energy security risks.

Under the GST regime, such differential treatment (18% vs 28%) will be rationalised post the recent GST Council Meeting, with effect from September 22, 2025. This harmonization reflects the Government's aim to reduce costs for manufacturers and end-users, promoting innovation and wider adoption of diverse battery technologies.

This whitepaper offers a comprehensive tax policy recommendations to align GST (which has now been resolved) and customs treatment across all advanced battery technologies, ensuring a neutral, efficient, and investment-friendly framework.

Inside this whitepaper

  • Effective duty differentials between emerging and environmentally friendly technologies
  • Market distortions that arise from uneven tax structures in clean energy
  • The role of GST and customs parity in advancing a technology-agnostic PLI scheme
  • India’s battery demand outlook: import dependence, cost implications, and IRR trends
  • Assessing neutrality, equity, and efficiency in the current tax framework
  • Risks of concentrated reliance on certain specific technology over emerging or indigenous alternatives
  • Policy reforms that can create a level playing field and strengthen India’s global energy position

Why it matters now?

  • India targets a 45% reduction in emissions intensity by 2030 and 50% installed power from non-fossil sources.
  • Battery demand will triple by 2030, driven by EV adoption and renewable integration.
  • Without rationalised taxes, India risks missing manufacturing opportunities and worsening its trade deficit.

Aligning Customs rates isn’t just tax policy; it’s industrial strategy, climate strategy, and energy security policy rolled into one and will also align with the recent change in the GST rates offering parity to the new and emerging battery storage technologies.

Download the whitepaper to explore how this landmark legislation will transform data governance in India.
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