The Ministry of Finance has granted a partial exemption from the Agriculture Infrastructure and Development Cess (AIDC) on imports of ammonium nitrate from April 2, 2026, and will remain valid until June 30, 2026.
The notification has been issued under the powers conferred by Section 25(1) of the Customs Act, 1962, read with Section 124 of the Finance Act, 2021. It provides that ammonium nitrate, classified under tariff item 3102 30 00 of the Customs Tariff Act, 1975, will attract a nil rate of AIDC for the specified period.
This effectively means that importers of ammonium nitrate will not be required to pay any AIDC during the exemption window, thereby reducing the overall landed cost of the product.
Ammonium nitrate is a critical input used in: fertilizer manufacturing, mining and explosives industries, and infrastructure and construction activities
Given its widespread industrial application, fluctuations in its cost have a cascading impact across multiple sectors. The temporary cess relief is expected to provide cost stability and support ongoing infrastructure and agricultural activities.
The government has stated that the exemption has been granted “in the public interest,” indicating a policy intent to control input cost inflation, ensure adequate supply of essential industrial chemicals, and support sectors dependent on ammonium nitrate
Such time-bound exemptions are often used as fiscal tools to respond to market volatility or supply-side constraints.
The relief is strictly temporary, with a sunset clause ending on June 30, 2026. Stakeholders, including importers and downstream industries, may need to plan procurement strategies accordingly to maximize the benefit during this period.
The exemption from AIDC on ammonium nitrate signals a targeted intervention by the government to ease cost pressures in key sectors. While the measure is short-term, it is likely to provide immediate relief to industries reliant on this essential chemical and may contribute to stabilizing prices in the near term.
Notification Details
Notification No. 13/2026–Customs
Date: 01/04/2026
Read More: CBIC Revises Tariff Values for Edible Oils, Precious Metals and Areca Nuts
