Government has announced a Rs 12,400 crore outlay for the Remission of Duties and Taxes on Exported Products (RoDTEP) export promotion scheme.
The Commerce Department announced on August 17 that new export refund rates under RoDTEP would cover 8555 tariff lines, or individual merchandise products traded by India internationally.
The announcement of the rates, which are in the range of 0.5-4.3 percent come two years after the scheme was first announced. It had missed several deadlines. RoDTEP had been live since January 1, 2021 but had remained inactive due to the unavailability of rates.
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Commerce Secretary BVR Subrahmanyam said RoDTEP would give a boost to Indian exports, making them more competitive globally.
How it works
It aims to refund exporters duties and taxes such as VAT on fuel used in transportation, Mandi tax and duty on electricity used during manufacturing, that were so far not being refunded. While the government has clarified that the rebate would be claimed as a percentage of the Freight on Board value of exports.
However, the rebate on certain products will also be subject to value cap per unit of the exported product, the government has clarified.
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The RoDTEP scheme will be India’s biggest, and realistically, only export promotion scheme. According to the government’s own estimates, it is expected to significantly impact India’s competitiveness, trade flows and export numbers over the next 5-10 years.
The government had announced the RoDTEP after the Merchandise Exports from India Scheme (MEIS), India’s foremost export incentive scheme till then was ordered to be shutdown by the World Trade Organization(WTO).
