A day after the Commerce Ministry halved Remission of Duties and Taxes on Exported Products (or RoDTEP) rates for all products, the rates for agriculture, dairy, meat and marine products have been restored as per the notification issued by the Directorate General of Foreign Trade on Tuesday. However, exporters from other sectors such as textiles, leather, handicrafts, sports goods and engineering products are also seeking relief and have urged the ministry to reconsider the decision.
“RoDTEP is not any incentive, but just a duty refund. At a time when the Indian exporters are already facing challenges due to global turmoil, halving the RoDTEP rate will make it even more challenging for exporters,” said a textile exporter on the condition of anonymity.
Confederation of Indian Textile Industry (CITI) has requested the government to revisit this decision immediately to ensure that textile exporters are not impacted. Textile export orders are locked in 2-3 months ahead, with prices set based on prevailing remission benefits. The cap on RoDTEP can incur severe losses to the exporters.
Ajay Srivastava, founder, Global Trade Research Initiative (GTRI) explained when the RoDTEP rate falls from 2% to 1% and the value cap from ₹50 to ₹25 per kg, the refund can drop from ₹20 to ₹5 for a 20-kg shipment. “This sharp decline does not reflect any reduction in embedded domestic taxes and shifts costs back onto exporters, undermining tax neutrality,” said Srivastava.
Federation of Indian Export Organisations (FIEO) has also reached out to the Ministry requesting to reconsider the decision. Alongside, exporters are seeking more clarity on the announcement as the scheme is currently valid only until 31 March 2026, and it remains unclear whether it will be extended beyond this period.
“We need fine details on this (RoDTEP scheme refund cut). Raw material prices have gone up by 20% or more , as we import wool from New Zealand. Plus, the US tariff devastated the sector. At such a time, such an announcement creates a depressing atmosphere,” said Piyush Baranwal, honorary secretary of the All India Carpet Manufacturers’ Association.