Mumbai: The GST Council’s decision to reduce tax rates across the fisheries value chain is set to ease financial pressure on a wide range of rural stakeholders. From fish farmers and aquaculturists to small-scale fishers, women’s self-help groups and cooperatives, the reforms offer tangible relief by lowering the cost of essential inputs and equipment. With the revised rates taking effect from September 22, 2025, producers are expected to benefit from reduced operational costs and improved viability. These changes come at a time when fisheries and aquaculture continue to expand rapidly, playing a vital role in rural employment and income generation across India.
Among the most consequential adjustments is the reduction of GST on essential aquaculture equipment and inputs. Diesel engines, pumps, aerators and sprinklers, all critical for pond management and hatchery operations, will now attract 5 per cent GST, down from the earlier 12 to 18 per cent. This change alone is likely to ease capital expenditure for fish farmers and cooperatives, many of whom operate on tight margins and limited access to formal credit.
Similarly, the GST rate on pond conditioning chemicals such as ammonia and micronutrients has been cut to 5 per cent. These inputs are vital for maintaining water quality and ensuring healthy fish growth. Lower taxation on such items reduces the cost of feed and farm-level practices, making aquaculture more accessible to small and marginal producers, including women-led self-help groups that have increasingly entered the sector through government-supported livelihood schemes.
The reforms also extend to seafood processing and value-added products. Prepared or preserved fish and shrimp, including exports, will now be taxed at 5 per cent instead of 12 per cent. This not only makes hygienically processed seafood more affordable for domestic consumers but also improves the competitiveness of Indian seafood in global markets. India’s seafood exports crossed ₹60,000 crore in 2023–24, with shrimp accounting for a significant share. Lower GST on these products supports processing units and job work services, which are often run by cooperatives and small enterprises in coastal and inland regions.
Fishing gear has also seen a rate reduction. Items such as rods, tackle, landing nets and butterfly nets – previously taxed at 12 percent – will now attract 5 per cent GST. This benefits small-scale fishers engaged in capture fisheries and recreational fishing, many of whom rely on affordable gear to sustain their livelihoods. The change is particularly relevant in states with large inland water bodies and coastal communities, where fishing remains a primary source of income.
Composting machines, used for producing organic manure and managing pond waste, are now taxed at 5 per cent. This supports sustainable aquaculture practices and aligns with broader environmental goals, while also reducing input costs for farmers who integrate fish farming with agriculture.
Taken together, these reforms represent a shift toward more inclusive taxation in the fisheries sector. By lowering the cost of inputs and equipment, the government has addressed a key barrier to entry and expansion for small producers. The impact is likely to be most visible in rural areas, where over 3 crore people depend on fisheries and aquaculture for their livelihoods. Many of these are informal workers, women entrepreneurs, and cooperative members who stand to benefit from reduced financial pressure and improved viability.
India produced nearly 195 lakh tonnes of fish in 2024–25, making it the second-largest fish producer globally. Yet the sector’s growth has often been constrained by fragmented supply chains and high input costs. The GST rationalisation helps correct these imbalances, offering a more predictable and affordable framework for producers and processors alike.
While the reforms do not address every structural challenge in the sector, they mark a clear step toward improving rural incomes and supporting the Blue Economy. By easing the financial burden on those at the base of the value chain, the changes reinforce the role of fisheries as a driver of employment, nutrition and export growth.
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