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| Empowering India's Exports: Extended RoDTEP Scheme |
In a significant stride to fortify India’s export sector amidst global economic uncertainties and supply chain disruptions, the government has announced the extension of the Remission of Duties and Taxes on Exported Products (RoDTEP) scheme to encompass companies operating within Special Economic Zones (SEZs), Export-Oriented Units (EOUs), and holders of Advance Authorisations. This decision, unveiled by Union Minister of Commerce & Industry Piyush Goyal on March 8, 2024, underscores the pivotal role these sectors play in India’s export landscape, collectively contributing to approximately 25% of the nation’s total shipments.
RoDTEP Scheme: A Pivotal Initiative
The RoDTEP scheme, inaugurated in January 2021, is devised to reimburse various embedded taxes and duties on exported products that do not qualify for rebates under other schemes like GST or the Duty Drawback scheme. These encompass central, state, and local duties, taxes, and levies incurred throughout the manufacturing and distribution processes of exported goods. To date, the scheme has disbursed support exceeding ₹42,000 crores to more than 10,500 export items at the 8-digit ITC HS Code level.
Budget Allocation and Extension Period
For the ongoing fiscal year, the RoDTEP scheme has been allocated a budget of ₹15,070 crores, with an additional 10% augmentation slated for the fiscal year 2024-25. Given this budgetary provision, the extension of RoDTEP assistance to additional sectors is currently slated until September 30, 2024.
Empowering Key Sectors
The extension of the RoDTEP scheme is poised to benefit critical export sectors, including engineering, textiles, chemicals, pharmaceuticals, and food processing, among others. By extending support to these sectors, the government aims to bolster their competitiveness in global markets, foster employment generation, and contribute to the overarching economic advancement of the nation, aligning with the vision of forging an Aatmanirbhar Bharat (self-reliant India).
The commerce ministry asserts that broadening RoDTEP benefits to hitherto uncovered sectors such as Advance Authorisation, EOUs, and SEZ units will equip the exporting community to navigate international challenges with greater efficacy. This extension is geared towards enhancing India’s export competitiveness in the global arena, especially amidst economic uncertainties and supply chain disruptions.
RoDTEP Rates and Refunds
Under the RoDTEP scheme, a gamut of central and state duties, taxes, and levies levied on input products are refunded to exporters. Presently, RoDTEP rates fluctuate between 0.3% to 4.3%. The core objective of the scheme is to refund taxes and duties not covered under other schemes, thereby ensuring that exporters are not encumbered by additional costs.
Government’s Vision
The government expresses confidence that the proactive measures being undertaken, including endeavors to negotiate new Free Trade Agreements (FTAs), will expedite India’s journey towards attaining USD 1 trillion in merchandise export levels. The extension of the RoDTEP scheme to additional sectors constitutes a pivotal stride in this trajectory, as it seeks to bolster and catalyze the growth of India’s exports.
By extending the RoDTEP scheme's ambit and ensuring its efficacy, India aims to fortify its position in the global trade arena, fostering sustained economic growth and prosperity.