DGFT Restores RoDTEP Rates: GTRI

The government has restored benefits under the Remission of Duties and Taxes on Exported Products Scheme to February 22 levels, reversing the 50% cut imposed last month, GTRI said in a report.

The government had halved export rebates under scheme across tariff lines. The value caps were also been reduced by half. For instance, the rebate on unginned raw cotton of staple length not exceeding 20 mm has been reduced from 3.1%, capped at ₹1.60 per kg, to 1.55% with a cap of ₹0.80 per kg, GTRI had said in its earlier report.

Also, the RODTEP restoration decision is valid for exports made up only March 31 ie one week from now. No one knows what rates apply after March 31. This creates huge uncertainly for the exporters in such uncertain times. No export contracts can factor RODTEP benefits in such cases, GTRI said.

RoDTEP is not an export subsidy but a refund of embedded taxes and levies paid during production—such as state taxes on fuel, electricity duties and mandi charges—that are not otherwise rebated.

WTO rules permit such remission because it merely neutralises domestic taxes on exports.

DGFT decision to restore the rates is welcome but the initial reduction was hard to justify as RoDTEP is not a subsidy; it simply refunds taxes exporters have already paid, said GTRI Founder Ajay Srivastava.

Cutting rates arbitrarily made little sense unless earlier rates were wrongly fixed, he said.

For exporters operating on tight margins, stable incentives are critical for pricing and long-term planning. Locking in RoDTEP rates for the next five years would provide that certainty, enabling firms to integrate these refunds into cost structures and compete more effectively in global markets, he said.