DGFT extends RoDTEP scheme till March 2026 as US tariffs weigh on exports

By Admin

01 Oct, 2025

The Directorate General of Foreign Trade (DGFT) has announced the extension of the Remission of Duties and Taxes on Export Products (RoDTEP) scheme until March 31, 2026. The move comes as Indian exporters face heightened challenges from steep tariffs imposed by the United States, threatening the competitiveness of Indian goods in global markets.

Scheme Extension Amid Tariff Headwinds

In its notification, DGFT confirmed that RoDTEP will continue to apply to shipments from Domestic Tariff Area (DTA) units, Advance Authorisation holders, Special Economic Zone (SEZ) units, and Export Oriented Units (EOUs). The six-month extension aims to cushion exporters from the impact of the US’s 50% tariff on Indian imports, introduced in two rounds of reciprocal duties since August, tied to India’s crude oil trade with Russia.

RoDTEP: Supporting Export Competitiveness

Launched in 2021, the RoDTEP scheme is designed to reimburse exporters for embedded non-creditable central, state, and local levies on inputs. By offsetting these hidden costs, the scheme ensures that domestic taxes are not exported, thereby keeping Indian goods globally competitive.

The Union Budget for FY26 allocated ₹18,232 crore to the programme, a notable increase from ₹16,000 crore in FY25, highlighting the government’s commitment to supporting exporters during turbulent trade conditions.

Export Trends Show Mixed Signals

India’s merchandise exports grew 2.5% year-on-year to $184 billion in April–August FY26, with shipments to the US registering a robust 18% growth to over $40 billion, largely driven by frontloading of orders. However, industry analysts caution that this momentum may not last as higher tariffs begin to weigh on future exports to the US.

Industry Welcomes the Move

Federation of Indian Export Organisations (FIEO) President Ashwani Kumar Ralhan welcomed the extension of the RoDTEP scheme. He remarked:
“The scheme has been instrumental in neutralising the burden of non-creditable taxes, making exports competitive. Its continuation will help Indian exporters maintain momentum in a difficult global trade environment.”

Ralhan also emphasized that such supportive measures encourage exporters to diversify their product portfolios and explore new markets, thereby reducing over-dependence on traditional trade partners.

Looking Ahead

The extension of the RoDTEP scheme underscores India’s proactive stance in safeguarding its exporters amid global trade uncertainties. While the US tariffs pose a significant challenge, policy support like RoDTEP could help Indian exporters navigate the turbulence, maintain global competitiveness, and gradually diversify into alternative markets.