India is preparing to reinstate an important tax refund scheme for exporters starting June 1, a move announced by the commerce ministry on Tuesday that aims to strengthen the country’s global trade competitiveness. The scheme, known as the Remission of Duties and Taxes on Exported Products (RoDTEP), had been temporarily suspended since February 5 but will now be resumed across all eligible exports in key sectors such as textiles, pharmaceuticals, automobiles, chemicals, agriculture, and food processing.
RoDTEP is designed to reimburse exporters for various levies and taxes incurred during the production and export process that are not compensated by other government programs. By reinstating this scheme, the government intends to level the playing field for exporters, helping them better compete in global markets where such costs can put Indian products at a disadvantage.
The trade ministry highlighted that the platform for disbursing RoDTEP benefits will be fully digital, ensuring greater transparency and efficiency in processing refunds. This is expected to simplify procedures for exporters and speed up reimbursements, enabling businesses to manage their cash flows more effectively.
Launched in January 2021, RoDTEP has already disbursed over ₹57,977 crore (approximately $7 billion) as of March 31. A senior government official told Reuters that the earlier suspension of the scheme was intended to reassess the appropriate level of support needed by exporters. Given the current global trade environment, the government recognized the importance of continuing these benefits to sustain export growth.
The reinstatement comes at a strategic moment for India’s trade policy. The country recently concluded a trade agreement with the United Kingdom and is actively pursuing a deal with the United States. This is particularly critical as India navigates the expiration of a 90-day reprieve from the steep tariffs imposed by former US President Donald Trump. By reviving RoDTEP, the government hopes to provide Indian exporters with a competitive edge in the increasingly challenging global trade landscape.
Overall, the return of RoDTEP signals India’s commitment to supporting its exporters amid evolving international trade dynamics, helping safeguard export revenues and encouraging sustained growth across key sectors.
