“Indirect Tax I Indirect Tax Litigation I Customs & FTP I Central Licensing I Arbitration I Advisory”
Dated: 23.09.2025
Government of India Strengthens Defense and Aerospace Capabilities with New Customs Exemptions
The Ministry of Finance, Department of Revenue, has issued Notification No. 37/2025-Customs, dated September 17, 2025, introducing significant amendments to the existing Customs Notification No. 19/2019-Customs. These amendments, aimed at promoting public interest, will come into effect on September 22, 2025. Below, we delve into the details of this notification and its implications.
Background
The principal notification, No. 19/2019-Customs, was originally published on July 6, 2019, and has undergone several amendments over the years. The latest amendment, Notification No. 37/2025-Customs, introduces new items to the exemption list under the Customs Act, 1962, and the Customs Tariff Act, 1975. This move reflects the government’s commitment to supporting defense, aerospace, and specialized industries by reducing import duties on critical equipment and components.
Key Amendments
The notification adds 19 new entries to the exemption list, covering a wide range of goods and components essential for defense, aerospace, and underwater operations. Below are the highlights:
- Flight and Target Motion Simulators: These simulators and their parts (Sl. Nos. 24 and 25) are now exempted, supporting advancements in training and operational readiness.
- Military Transport Aircraft: Specific models like C-140 and C-295 MW (Sl. No. 29) are included, facilitating the import of advanced military transport systems.
- Underwater Vessels and Rescue Equipment: Deep submergence rescue vessels and unmanned underwater platforms (Sl. Nos. 30 and 31) are now exempted, enhancing naval capabilities.
- Ejection Seats for Fighter Aircraft: Sl. No. 32 includes ejection seats, a critical safety feature for fighter aircraft.
- High-Performance Batteries: Batteries for drones and specialized equipment (Sl. No. 33) are now covered, supporting the growing demand for unmanned systems.
- Communication Devices: Software-defined radios and related accessories (Sl. No. 34) are included, ensuring seamless communication in defense operations.
- Diving Systems: Air diving and rebreather sets (Sl. No. 35) are exempted, aiding underwater missions.
- Missiles and Rockets: Ship-launched missiles and rockets with calibers exceeding 100 mm (Sl. Nos. 37 and 38) are now part of the exemption list.
- Remote Pilot Aircraft (RPA): RPAs for military use (Sl. No. 39) are included, promoting advancements in unmanned aerial systems.
- Technical Documentation: Sl. No. 41 covers technical documentation for goods listed in Sl. Nos. 1 to 40, ensuring streamlined import processes.
Implications
The amendments are expected to have far-reaching implications for India’s defense and aerospace sectors:
- Boost to Indigenous Manufacturing: By facilitating the import of critical components, the notification supports the “Make in India” initiative, enabling domestic manufacturers to integrate advanced technologies.
- Strengthening National Security: The inclusion of military transport aircraft, missiles, and underwater vessels enhances India’s defense capabilities.
- Encouraging Innovation: Exemptions for items like RPAs, high-performance batteries, and communication devices promote innovation in unmanned systems and advanced technologies.
- Cost Reduction: Reduced import duties on essential equipment and components will lower costs for defense and aerospace projects, ensuring efficient allocation of resources.
Effective Date
The notification will come into force on September 22, 2025, providing stakeholders sufficient time to align their operations with the new provisions.
Conclusion
Notification No. 37/2025-Customs marks a significant step in India’s journey toward self-reliance in defense and aerospace. By exempting import duties on critical equipment and components, the government is fostering innovation, strengthening national security, and supporting indigenous manufacturing. Stakeholders in the defense, aerospace, and underwater operations sectors should carefully review the amendments and leverage the opportunities they present.
In case you face any issues related to Indirect Tax-Customs, GST, Foreign Trade Policy (FTP), Arbitration matters and Central Licensing and related advisory matters in India then please feel free to get in touch with SJ EXIM Services.
We offer Legal advice and litigation support in matters related to Indirect Tax-Customs, FTP, other Indirect Tax matters & Arbitration law, all sorts of Central licensing and related matters. Come and explore the new way of doing business with us!
Source: CBIC, Ministry of Finance, Govt. of India
Handy Download:
Connect with us for more-
@ Team S J EXIM SERVICES, New Delhi, IN
CP: Ms. Shubhra Jha, Founder
Tel: +91-11-4999 2707 I +91-9999005693
Web: www.sjexim.services
EMAIL: operations@sjexim.services I shubhra@sjexim.services
Facebook: www.facebook.com/sjeximservices
LinkedIn: https://www.linkedin.com/company/90794255/admin/feed/posts/
YouTube: https://www.youtube.com/@sjeximIndia
Subscribe our WhatsApp Channel: https://whatsapp.com/channel/0029VaTxDT8JZg4CHEOSoK47
Subscribe our Telegram Channel: https://t.me/sjeximindia
Leave a ReplyCancel reply