REMISSION OF DUTIES AND TAXES ON EXPORTED PRODUCTS (RODTEP) SCHEME

1. REMISSION OF DUTIES AND TAXES ON EXPORTED PRODUCTS (RODTEP) SCHEME

Context

The Government of India has extended the Remission of Duties and Taxes on Exported Products (RODTEP) scheme up to March 31, 2026. This extension is aimed at providing continued support to exporters by reducing hidden costs, thereby strengthening India’s global trade competitiveness.

Mechanism of the Scheme

• Refundable Taxes Covered:
   
  • Fuel taxes.
     
  • Electricity duties.
     
  • Stamp duties and other embedded levies.
     
• Mode of Benefit: Exporters receive refunds through transferable electronic scrips, which can be used for payment of basic customs duties.
   
• WTO Compliance:
   
  • RODTEP replaced MEIS, which was struck down by the World Trade Organization (WTO) for violating subsidy norms.
     
  • Unlike MEIS, RODTEP is fully WTO-compliant, ensuring India avoids trade disputes while continuing to support exporters.
     

Administration and Budgetary Support

• Administering Ministry: Ministry of Finance.
   
• Nodal Department: Department of Revenue.
   
• Budgetary Allocation: Around ₹15,000 crore was earmarked for RODTEP in 2023–24, reflecting the government’s strong focus on boosting export-led growth.
   

Importance of the Scheme

• Enhances competitiveness of Indian goods in global markets.
   
• Ensures level playing field by neutralizing hidden domestic taxes not refunded through other mechanisms.
   
• Supports export diversification and strengthens India’s position in international supply chains.
   
• Provides predictability for exporters with the scheme now extended till 2026.
   

Conclusion

The Remission of Duties and Taxes on Exported Products scheme reflects India’s strategy to maintain WTO compliance while supporting exporters by offsetting hidden levies. Its extension until March 2026 ensures policy stability, investor confidence, and globally competitive trade practices.