New Delhi, February 24 The government clarified on Tuesday that the reduced rates and value caps under the export support scheme, RoDTEP, are not applicable to the export of agricultural and processed food products.
This development is significant, as the government halved the duty benefit rates under the scheme with immediate effect on Monday. The exporting community expressed disappointment and sought a reconsideration of the decision.
The Remission of Duties and Taxes on Exported Products (RoDTEP) Scheme, launched in 2021, provides for a refund of taxes, duties, and levies that exporters incur in the manufacturing and distribution of goods, and which are not reimbursed under any other mechanism at the Centre, state, or local level.
Refunds under the scheme range from 0.3 per cent to 3.9 per cent. The scheme is valid until March of this year.
"The reduced rates and value caps of RoDTEP benefits notified under Notification No 60 dated February 23, 2026, are not applicable for export products falling under ITC HS Chapter 01 to 24," the Directorate General of Foreign Trade (DGFT) said in a notification.
Chapter 1-24 deals with agricultural and processed food products.
The budget allocation for the scheme in 2025-26 was Rs 18,232 crore. It was proposed to increase to Rs 21,709 crore in 2026-27. However, the allocated budget was Rs 10,000 crore.
According to sources, a note has been sent from the Ministry of Commerce to the Department of Expenditure, seeking enhanced allocations for the Expenditure Finance Committee (EFC). Comments from all the relevant ministries have also been sent to the department.
"We are seeking a date for the EFC meeting. We are awaiting the response," they said.
Expressing disappointment at the rate cut, Sharad Kumar Saraf, an exporter and founder chairman of Technocraft Industries India based in Mumbai, said that a sudden 50 per cent reduction in RoDTEP is a shock for exporters.
"There is no change in any duties. The definition of RoDTEP is the reimbursement of duties and taxes. Exporters have already booked orders based on RoDTEP rates. Many products and commodities are exported at 1 or 2 per cent margins. They will all suffer more losses," he noted.
Saraf added that the reduction has come at a time when exporters are struggling with Trump tariffs.
"At this time, the government should have supported exporters. Such sudden action will result in exporters losing faith in a stable policy framework," he said.
Ramesh Juneja, Chairman of the Council for Leather Exports, said that during this period of global trade turbulence and intense competitive pressure, the leather and footwear industry requires strong and timely support from the government to remain competitive with other Asian exporting nations.
"Sustained policy backing and a stable incentive framework are essential to safeguard growth, protect market share, and strengthen India's position in the global leather and footwear value chain," he said.
The country's exports rose marginally by 0.61 per cent to USD 36.56 billion in January, while the trade deficit widened to a three-month high of USD 34.68 billion.
