Over Rs 15,700 Crore Disbursed Under RoDTEP Duty Refund Scheme to Exporters This Fiscal
Over Rs 15,700 crore was disbursed to exporters under the Remission of Duties and Taxes on Exported Products (RoDTEP) scheme up to December 25 of the current fiscal year 2025-26, benefitting more than 1.11 lakh exporter businesses.
The Union Budget 2025-26 had allocated Rs 18,232 crore for RoDTEP — an increase over Rs 16,000 crore in FY25 — signalling the government's commitment to scaling up the scheme.
In the context of the West Asia crisis (Iran war, 2026), the government separately announced the restoration of full RoDTEP benefits to exporters and extended the scheme by six months to September 2026, cushioning exporters from supply chain disruptions and elevated input costs.
RoDTEP Scheme: Full Form, Origin, and WTO Compliance
RoDTEP stands for Remission of Duties and Taxes on Exported Products. Launched on January 1, 2021, it replaced the Merchandise Exports from India Scheme (MEIS). The transition was necessitated by a WTO dispute: the United States had challenged MEIS at the World Trade Organization, arguing it constituted an export subsidy prohibited under WTO's Agreement on Subsidies and Countervailing Measures (ASCM).
The Rs 15,700 crore disbursed in the first three quarters of FY26 indicates the scheme is on track relative to its Rs 18,232 crore annual allocation, and the West Asia crisis extension demonstrates its role as a countercyclical buffer for exporters.
India's Export Promotion Architecture
India's export promotion policy operates through multiple instruments: (1) duty-exemption/remission schemes like RoDTEP, (2) Export Promotion Capital Goods (EPCG) scheme for technology upgradation, (3) Advance Authorisation for duty-free import of inputs, (4) Special Economic Zones (SEZs) offering fiscal incentives, and (5) the Market Access Initiative for marketing in new geographies.
RoDTEP disbursements directly improve export competitiveness by reducing the effective tax burden on Indian goods, helping Indian exporters price their products more competitively in global markets — crucial during a period when global supply chains are under stress.
WTO Disciplines on Export Subsidies
The WTO's Agreement on Subsidies and Countervailing Measures (ASCM) prohibits "specific" export subsidies — government financial contributions that are contingent on export performance and confer a benefit. India, as a WTO member (since 1995), must align its export incentive schemes with ASCM disciplines. Large developing countries like India lost the "special and differential treatment" exemption for export subsidies once per-capita GNP exceeded $1,000 in three consecutive years (Annex VII(b) countries).
Key Details
- MEIS was challenged by the US (DS541: India — Export Related Measures) in 2018; a WTO panel ruled against India in 2019.
- India accepted the ruling and committed to transitioning away from MEIS, leading to RoDTEP's design as a pure remission (not subsidy) mechanism.
- The distinction: MEIS gave a fixed percentage benefit regardless of actual embedded taxes, constituting a subsidy. RoDTEP remits only verifiable embedded taxes, passing WTO scrutiny.
- Other WTO-challenged schemes that India had to phase down: EOU (Export Oriented Unit) tax exemptions, SEZ Act provisions under DS510.
RoDTEP's disbursements represent a WTO-permissible support mechanism for Indian exporters. The scale of the scheme (Rs 18,000+ crore annually) illustrates the quantum of embedded taxes borne by Indian exporters that needed reimbursement, and the diplomatic-legal significance of designing it correctly.
- RoDTEP full form: Remission of Duties and Taxes on Exported Products.
- Launched: January 1, 2021 (replaced MEIS).
- Disbursement up to December 25, FY26: Rs 15,700+ crore; beneficiaries: 1.11 lakh exporters.
- FY26 budget allocation: Rs 18,232 crore (up from Rs 16,000 crore in FY25).
- Cumulative disbursement (2021–March 2025): over Rs 57,976 crore.
- Refund rates: 0.5%–4.3% of FOB value across 8,555 HS product lines.
- Administered by DGFT under Ministry of Commerce and Industry.
- WTO challenge by US (DS541): MEIS ruled WTO-incompatible in 2019; RoDTEP designed to be WTO-compliant.
- Scrip-based digital disbursement via ICEGATE portal.
- Scheme extended by 6 months to September 2026 during West Asia crisis.