Exporters are concerned about the sharp reduction in outlay for the two-flagship input duty remission schemes, RoDTEP and RoSCTL, even as expectations persist that funding could be topped up in the revised budget estimate after the rate rationalization exercise concludes.
"Allocation under both the scheme is substantially down. We expect that the revised budget estimate will increase the allocation as these refund schemes of duty neutralization are crucial for our exports", said Ajay Sahai, Director General, Federation of Indian Export Organizations.
RoDTEP (Remission of Duties and Taxes on Exported Products) refunds embedded Central, State and local taxes not otherwise rebated, helping exporters stay price competitive in global markets. The budgetary allocation for the scheme for FY27, at INR10,000 crore, was lower by about 45 per cent than the previous fiscal's allocation of INR18,232.5 crore.
The allocation for RoSCTL (Rebate of State and Central Taxes and Levies), which provides similar relief specifically to apparel and made-ups exporters, too, was slashed by 50 per cent in FY27 to INR5,000 crore from INR10,010.38 crore in FY26.
A high-level committee led by former secretary Neeraj Kumar Gupta was established in October 2025 to review and recommend revised rates for the RoDTEP (Remission of Duties and Taxes on Exported Products) and RoSCTL (Rebate of State and Central Taxes and Levies) schemes, with the main report due by March 31, 2026. The current RoDTEP rates range between 0.3 to 4.3 per cent.
Reduction in provisions
"The reduction in provisions for RoDTEP in 2026-27, is disappointing. We need to request the government again to at least restore the previous levels, if not increase it. Most councils have submitted the data validating their rates which is actually coming in higher than the allocation. As export is zero rated we should look at complete refund of this tax," said Israr Ahmed, Director, Farida Group.
Another Delhi-based garments exporter pointed out that a lower outlay could result in a slowing down of payments.
"We have received a clarification that the budgeted amounts are provisional as both the RoDTEP & RoSCTL schemes are currently under evaluation/ review. We are hoping that the outlay gets increased adequately so that all valid demands of exporters are met", the exporter said.