Why a superbike costs so much more in India: CBU, SKD and CKD duty explained

The short answer is that an imported motorcycle is taxed twice over. First at the port, as basic customs duty, which since the Union Budget of 1 February 2025 runs from 40 per cent on a fully built bike of up to 1,600cc down to 10 per cent on a kit of parts. Then again at the showroom, as GST, which is 40 per cent on anything above 350cc. Nothing about the Indian price of a Panigale or a Tiger is a mystery once you know which route the bike took to get here.

The three routes a big bike can take

Customs does not care what the brochure calls the bike. It cares how assembled it was when it crossed the border, and Notification 08/2025-Customs of 1 February 2025 sets out three states.

A CKD kit is one where the engine, gearbox and transmission mechanism arrive not in a pre-assembled condition. An SKD kit is one where the engine or gearbox or transmission is pre-assembled but not mounted on a body assembly. Anything else, including a crated bike that only needs mirrors and a battery, is a CBU.

Budget 2025 cut all three. CBU duty on bikes of up to 1,600cc went from 50 per cent to 40 per cent, CBU duty above 1,600cc went from 50 per cent to 30 per cent, SKD from 25 per cent to 20 per cent and CKD from 15 per cent to 10 per cent.

Read that again, because it is the odd part. A fully imported 1,800cc cruiser now pays less basic customs duty than a fully imported 900cc twin. The cut was deepest in the segment where no Indian maker competes.

Then GST lands on top

The 56th GST Council meeting of 3 September 2025 split two-wheelers at 350cc. From 22 September 2025, bikes of up to 350cc pay 18 per cent GST, down from 28 per cent, and bikes above 350cc pay 40 per cent, replacing 28 per cent plus a 3 per cent cess. Every motorcycle on this beat sits on the wrong side of that line.

So the duty-paid landed cost becomes the base on which 40 per cent GST is charged, and then come freight, the importer's margin, the dealer's margin and, at registration, your state's road tax and insurance. That is the whole stack, and it is why a bike that looks reasonable in euros looks like a used hatchback in rupees.

Why some brands assemble here and others do not

The gap between 40 per cent on a CBU and 10 per cent on a CKD kit is the single biggest lever a maker has on its Indian price list. Taking it means setting up a line, sourcing parts locally and, critically, shipping engines and gearboxes in pieces so the kit still qualifies as CKD. That only pays back at volume, which is why mid-capacity models get built in India while 1,000cc-plus flagships usually arrive as CBUs in small numbers.

The India-UK trade agreement is the thing to watch next. Reporting on the deal says premium motorcycle brands including Triumph, Norton and BSA get duty relief similar to cars, on a quota basis, but model-level numbers for bikes are not in the public summaries yet. Until a maker announces a revised price list, treat talk of cheap British twins as a plan, not a price.

Sources

• Budget 2025: Government cuts duty on import of motorcycles, Autocar Professional
• Budget 2025: Import duty on big bikes reduced, Autocar India
• Customs Notification 08/2025: Import Duty Revisions, TaxGuru
• GST on Bikes in India: New Rates, Applicability and HSN Code, ClearTax
• India reduces tariffs on heavyweight motorcycles and components, Motorcycle Regulatory Project
• Explained: What the India-UK FTA means for the auto sector, Outlook Business