India’s customs authorities have clarified that stationary and industrial battery energy storage systems can qualify for a concessional 10% basic customs duty rate, removing uncertainty over their classification as power banks.
India’s battery energy storage sector has received an important customs clarification that could help reduce uncertainty for businesses importing large-scale storage systems.
The Central Board of Indirect Taxes and Customs (CBIC) under the Ministry of Finance has clarified that stationary, grid-scale and industrial lithium-ion Battery Energy Storage Systems (BESS) are not covered by the “Power Bank” exclusion under the relevant customs notification. These systems when classified under tariff item 8507 60 00 and meeting the applicable conditions are eligible for a concessional Basic Customs Duty (BCD) rate of 10%, rather than the 20% tariff rate.
The clarification addresses differences in how customs officials had been assessing these systems, with some treating large-scale battery storage installations as power banks and denying them the lower duty rate.
Why Did CBIC Need to Clarify the Rules?
The issue arose from the wording of the customs notification governing lithium-ion batteries under tariff item 8507 60 00.
The notification provides a concessional BCD rate of 10% for specified goods under this tariff item, subject to exclusions. These include certain battery packs used in electric or hybrid vehicles, lithium-ion batteries or battery packs for mobile phones, and power banks. The standard tariff rate for the relevant goods is 20%.
However, stationary battery storage systems used in electricity networks and industrial facilities serve a different purpose from consumer power banks. They store electricity for use by the power system or industrial operations rather than primarily charging mobile phones and portable electronic devices.
CBIC noted that some customs field formations had been treating grid-scale and industrial BESS as power banks. This resulted in differing assessment practices and the denial of the concessional duty rate in some cases.
The latest clarification addresses this distinction.
What Does the New Clarification Say?
CBIC has clarified that the term “Power Bank” for the purposes of the relevant customs entry applies to lithium-ion battery devices with charging or discharging ports designed to function as external charging devices for mobile phones or other portable electronic devices.
Stationary, grid-scale and industrial lithium-ion battery energy storage systems falling under tariff item 8507 60 00 are therefore not covered by this particular exclusion. They should not be denied the concessional 10% BCD rate merely because they have been classified as power banks.
The clarification was issued through Circular No. 45/2026-Customs, dated October 9, 2026, and concerns Serial No. 325 of Table I of Notification No. 45/2025-Customs, dated October 24, 2025. It corresponds to Serial No. 528C of the earlier Notification No. 50/2017-Customs, dated June 30, 2017.
What Does the 10% Customs Duty Rate Mean for Battery Storage?
The distinction between a 10% concessional duty rate and a 20% tariff rate is significant for companies importing eligible battery storage equipment.
The clarification does not create a new concessional rate. Instead, it explains that qualifying stationary, grid-scale and industrial BESS should not be excluded from the existing concession merely by treating them as power banks. Other applicable conditions and exclusions continue to apply.
For eligible imports, the lower rate could reduce the basic customs duty payable compared with assessment at the 20% tariff rate. The actual financial benefit will depend on the value and classification of the imported goods, their eligibility under the notification and other applicable import charges.
The clarification may also help importers and customs officials apply the relevant provision more consistently.
Why This Matters for India’s Energy Storage Sector
Battery energy storage is becoming an important part of power infrastructure as India expands renewable energy generation and seeks ways to manage fluctuations in electricity supply and demand.
Grid-scale BESS can store electricity and release it when required, helping power systems manage peak demand and accommodate variable renewable generation. Such installations are different in scale and function from portable consumer batteries.
Clearer customs treatment is relevant to companies developing, importing or deploying these systems. Greater consistency in duty assessment could make import-related costs easier to evaluate during project planning, procurement and financial modelling.
However, the clarification alone does not establish how much costs will fall across the industry. The impact will vary according to individual projects, equipment sourcing, applicable duties and other expenses.
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What Happens Next?
CBIC’s clarification addresses a specific classification issue: whether stationary, grid-scale and industrial lithium-ion BESS should be treated as power banks for the purpose of the customs duty concession.
By defining the scope of the exclusion, the Board has provided clearer guidance for customs assessments involving eligible battery storage systems.
The development comes as energy storage attracts greater attention in India’s efforts to integrate renewable energy and strengthen electricity infrastructure. For companies working in the sector, the immediate significance is greater clarity on the applicable basic customs duty treatment, not a blanket exemption from customs duties.
The next step for importers and project developers will be to assess how the clarification applies to their specific equipment and import arrangements.
Source: Central Board of Indirect Taxes and Customs (CBIC), Ministry of Finance, Government of India – Circular No. 45/2026-Customs, dated October 9, 2026.
