Commerce Department seeks five-year extension, but Finance Ministry remains unconvinced about their effectiveness; some exporters fear discontinuation
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The Commerce Department is holding consultations with the Finance Ministry to secure a longer-term extension of two key export support schemes — the Remission of Duties and Taxes on Exported Products (RoDTEP) and the Rebate of State and Central Taxes and Levies (RoSCTL). Their latest three-month extensions are set to expire on December 31, even as the Finance Ministry is yet to be convinced about their effectiveness in boosting exports, according to sources.
“The Commerce Department had sought a five-year extension of the two schemes before they lapsed on September 30, arguing that remission of embedded input taxes was reimbursement, not an incentive. But it was ignored. It is trying again as the schemes are key export supports amid geopolitical crisis affecting trade,” a source said.
RoDTEP, which covers most exported products subject to specified exclusions, refunds embedded Central, State and local duties, taxes and levies that have not been rebated through other mechanisms. It is considered an important support for MSME exporters, including those in labour-intensive sectors. The notified rates vary by product and are linked to the eligible duties and taxes borne by exporters. RoSCTL follows a similar principle but is specifically designed for exports of apparel, garments and made-ups.
Extension woes
The short extension has heightened concerns among exporters about the schemes’ future. In April, the government had granted a six-month extension, but the latest extension runs for only three months.
“Some exporters fear that the Finance Ministry may be in a mood to discontinue the scheme altogether, as all pleas for a long-term extension have been ignored so far, even amid uncertainties such as the ongoing West Asia crisis,” a Mumbai-based exporter of engineering goods said.
Exporters have petitioned the government to extend both schemes for five years, arguing that repeated extensions lasting just three to six months do not provide the policy stability needed to navigate growing uncertainty in global markets.
Seeks more allocation
Separately, the Commerce Department has sought an increase in the allocation for RoDTEP to ₹23,000 crore for 2026-27, from the Budget estimate of ₹10,000 crore, citing the growth in merchandise exports.
India’s merchandise exports rose 18.51 per cent year-on-year to $259.89 billion in April-September 2026-27, compared with $219.30 billion in the corresponding period last year, according to Commerce Ministry data.
Published on October 18, 2026
