New Delhi, March 23: The Government of India has announced a set of GST rationalisation measures aimed at making waste management services, biodegradable products and greener transport options more affordable, as part of efforts to accelerate the country’s transition toward a low-carbon economy.
The reforms, introduced under the leadership of Prime Minister Narendra Modi, include significant tax reductions in key sectors linked to sustainability, including industrial waste treatment, compostable alternatives to plastic and commercial transport vehicles.
Officials said the measures are aligned with national initiatives such as Viksit Bharat 2047 and the LiFE (Lifestyle for Environment) movement, while supporting India’s long-term climate goals, including achieving net-zero emissions by 2070 and fulfilling commitments under the Paris Agreement.
GST Cut for Waste Treatment Infrastructure
One of the major changes is the reduction in GST from 12% to 5% on services provided by Common Effluent Treatment Plants (CETPs), which treat industrial wastewater from clusters of industries.
According to the government, the move is expected to reduce costs for micro, small and medium enterprises (MSMEs) that depend on shared treatment facilities instead of setting up their own systems. India currently has 222 operational CETPs across 21 states, collectively treating about 2,212 million litres per day of industrial wastewater.
Officials estimate that the GST reduction could save industries nearly ₹13.27 crore per day, while also encouraging the expansion of sustainable practices such as Zero Liquid Discharge systems, which are already being implemented by 53 CETPs to recycle treated water and reduce dependence on freshwater resources.
Cheaper Biodegradable Alternatives to Plastic
To combat plastic pollution, GST on biodegradable carry bags has been slashed from 18% to 5%. The government said this move is intended to support the transition away from single-use plastics by making compostable alternatives more affordable.
As a result of the tax cut, the price of compostable carry bags is expected to fall by around 11%, from about ₹200 per kilogram to roughly ₹178 per kilogram. The policy is also expected to boost the domestic biodegradable materials industry, which currently includes more than 200 certified compostable manufacturers producing starch-based and other eco-friendly materials.
Officials added that the measure complements national and coastal cleanup initiatives aimed at reducing plastic waste entering rivers and oceans.
GST Relief for Buses and Goods Vehicles
In another key decision, GST on buses and commercial goods vehicles has been reduced from 28% to 18%, a move aimed at modernising India’s transport fleet and reducing air pollution in cities.
The government said lower upfront costs are expected to encourage fleet operators to replace older vehicles with newer, cleaner models that comply with BS-VI emission standards, which are significantly less polluting than earlier BS-IV vehicles.
The reduction is also expected to support the expansion of public transport networks and improve last-mile connectivity, while lowering logistics costs for businesses and helping reduce the carbon footprint of freight transport.
Officials said the GST rationalisation package is designed to strengthen sustainable industries while making environmentally friendly products and services more accessible to businesses and consumers. The government added that the reforms are intended to reinforce India’s broader climate action strategy and support long-term environmental goals.
Just looking into this unique trend and your analysis on blouse styles is incredible.
Love the insight!