Context: The government has restored the RoDTEP scheme for exporters done by Advance Authorisation (AA) holders, Export-Oriented Units (EOUs), and units in Special Economic Zones (SEZs). The scheme had expired in February 2025. The decision aims to enhance competitiveness in overseas trade and support small and medium enterprises facing thin margins.
The government is considering extending the Remission of Duties and Taxes on Exported Products (RoDTEP) scheme for the Domestic Tariff Units (DTAs) beyond September 30, 2025.
Relevance of the Topic: Prelims: RoDTEP scheme- Prelims related facts.
What is the RoDTEP Scheme?
- The RoDTEP scheme was introduced in January 2021, replacing the existing MEIS (Merchandise Exports from India Scheme).
- Purpose:
- To ensure that the exporters receive the refunds on the embedded taxes and duties previously non-recoverable.
- To boost exports which were relatively poor in volume previously.
- Need:
- The US had challenged India’s key export subsidy schemes in the WTO.
- The WTO dispute panel ruled against India, stating that India’s export subsidy programmes violated WTO’s trade norms.
- The RoDTEP Scheme ensures Indian exporters are supported, while staying WTO-compliant.
- Eligibility criteria:
- All sectors, including the textiles sector, can avail benefits of RoDTEP Scheme.
- Manufacturer exporters and merchant exporters (traders).
- Special Economic Zone Units and Export Oriented Units.
- Goods exported via courier through e-commerce platforms.
- There is no particular turnover threshold to claim RoDTEP.
- Re-exported products are not eligible.
- Exported products need to have the country of origin as India.
Features of RoDTEP Scheme
- Refund of the previously Non-refundable duties and taxes: The scheme provides refund of duties and taxes which are levied at central, state and local level and are not refunded under any other mechanism. They include:
- Central and State Excise Duty on fuel for transportation of export goods (petrol, diesel, CNG, PNG, etc.)
- Coal cess or duty levied by States on electricity consumed for manufacturing of export goods
- Mandi tax levied by APMCs
- Toll tax and stamp duties on import-export documentation
- Value added tax (VAT) wherever applicable.
- Automated system of Credit:
- Refunds under the scheme are issued in the form of transferrable electronic scrips, which could be used for paying Basic Customs Duty on import of goods.
- The e-scrips (duty scrips) can be transferred electronically to another party.
- The benefit will not be in the form of direct credit to the bank account.
- These duty credits are maintained and tracked through an electronic ledger.
- Quick verification through Digitisation:
- Through the digital platform, clearance happens at a much faster rate.
- Multi-sector Scheme:
- RoDTEP covers all sectors, including the textiles sector.