RoDTEP Rates Slashed — Fiscal Tightening by the Government

What is RoDTEP?

RoDTEP (Remission of Duties and Taxes on Exported Products) is a flagship export promotion scheme launched by the Government of India on 1st January 2021. It replaced the earlier MEIS (Merchandise Exports from India Scheme) and reimburses embedded central, state, and local duties/taxes that are not refunded under other mechanisms such as GST or Customs Drawback.

The scheme is designed to make Indian exports more competitive in global markets by ensuring that domestic taxes embedded in the export price are refunded to exporters. The benefit is provided as a transferable electronic scrip which can be used to pay basic customs duty or transferred to others.

Key Updates — February 2026

Two critical notifications have been issued by the Central Government in quick succession, fundamentally altering the RoDTEP benefit structure for exporters.

• UPDATE 1 Notification No. 60/2025-26 (23-02-2026)
  The Central Government has notified that with immediate effect, the applicable RoDTEP rates for all HS Lines as notified in Appendix 4R and Appendix 4RE shall be limited to 50% of the existing rates and, where applicable, 50% of the notified value caps. This is a blanket reduction applicable immediately across all eligible export product lines.
• UPDATE 2 Corrigendum dated 24-02-2026
  As per the Corrigendum issued on 24-02-2026, the reduced rates and value caps of RoDTEP benefits notified under Notification No. 60 dated 23-02-2026 are NOT applicable for export products falling under ITC HS Chapters 01 to 24 (covering agricultural and food products). This exemption provides significant relief to India's agricultural export community.

Rate Structure: Before vs. After

The following illustrates the magnitude of the change for exporters falling under the revised notification:

The value caps have also been correspondingly reduced to 50% for all applicable HS lines, meaning not only the rate percentage but also the maximum per-unit benefit is halved.

Impact Analysis & Action Points

The sudden and significant reduction in RoDTEP rates requires immediate attention from all exporters. Below are the key areas requiring review and action:

• 01 Review Product Applicability
  Exporters must review the applicability of the reduction in RoDTEP rates for their specific export products. Check whether your HS code falls under Chapters 01–24 (exempt) or other chapters (50% reduction applies).
• 02 Reassess Export Pricing
  The impact on the pricing of export products must be evaluated. Exporters who had factored full RoDTEP rates into their export pricing and profitability projections need to immediately re-examine their cost structures.
• 03 Renegotiate Existing Contracts
  In cases where prices of products have already been fixed for future consignments, exporters must evaluate the impact on profitability and explore the possibility of renegotiation with customers. Force majeure or price escalation clauses in existing contracts should be reviewed.
• 04 Update Financial Models
  Annual export budgets, revenue projections, and tax incentive models must be updated immediately to reflect the revised RoDTEP benefit levels. This is critical for accurate financial reporting and investor communication.