Understanding the benefits of RoDTEP scheme: A guide for Indian exporters

From manufactures, MSMEs to exporters, sellers and businesses across all sectors can avail the benefits of the newly introduced RoDTEP scheme by the Government of India. In this blog, understand what is RoDTEP scheme and its benefits.
RoDTEP Scheme
From manufacturers and MSMEs to exporters, sellers and businesses across all sectors can avail the benefits of the newly introduced RoDTEP scheme by the Government of India. In this blog, understand what the RoDTEP scheme is and its benefits.

Replacing the Merchandise Exports from India Scheme (MEIS), the Government of India introduced the RoDTEP scheme – Remission of Duties and Taxes on Export Products in January, 20211. To provide Indian exporters with incentives and benefits on taxes, the government launched RoDTEP, aiming to boost exports from India to international markets. Under this scheme, exporters can avail refunds at the central, state, and local levels of duties and taxes paid during exports.

What is the Remission of Duties or Taxes on Export Products Scheme (RoDTEP)?

RoDTEP, an abbreviation for Remission of Duties or Taxes on Export Products, is a recent initiative by the Indian Government. This scheme was introduced through an amendment to the Foreign Trade Policy 2015-20, and it became effective for exports starting January 1, 2021. The primary aim of this scheme is to offset the taxes and duties incurred on exported goods that wouldn't otherwise be credited, reimbursed, or refunded in any way and are integrated into the exported goods.

Under this scheme, a refund is provided for all concealed central, state, and local duties, taxes, and levies associated with the goods exported which haven't been reimbursed through any existing program. This includes not only the exporter's direct expenses and the accumulated indirect taxes on goods incurred in earlier stages1.

Need for RoDTEP scheme

The RoDTEP scheme aims to provide refunds for the following currently unreimbursed elements:
a. Duties, taxes, and levies imposed at the central, state, and local levels on the exported product, which includes the cumulative indirect taxes incurred in prior stages related to the production of the exported product.
b. Indirect duties, taxes, and levies relevant to the distribution of the exported product.
It's important to note that this scheme does not apply to duties and taxes that have already been exempted, remitted, or credited.

Benefits of the RoDTEP scheme

1. Within the framework of this scheme, various taxes and duties, including Value Added Tax (VAT), Coal tax, Central Excise Duty (CED), Mandi tax, and others, are now eligible for full reimbursement. All the products that were previously covered by the MEIS scheme and RoSTCL are now under the purview of the new RoDTEP scheme. This provides exporters with significant financial empowerment and flexibility, motivating and enabling them to increase their exports across national borders.

2. Exporters will receive their refunds through an electronic ledger using transferable electronic credits. These electronic credits will be managed and overseen through the electronic ledger mentioned earlier and disbursed to exporters when they use the scheme. Automating this entire reimbursement process enhances its efficiency, making it far more streamlined and efficient than a traditional offline process involving extensive paperwork.

3. The implementation of a fully automated digital platform for this scheme expedites the procedures significantly compared to traditional offline methods. The electronic validation and security checks for documents submitted by exporters on the platform will ensure the integrity and efficiency of the process, resulting in faster and more streamlined transactions than previously experienced.

4. The scheme encompasses all industrial sectors in India, enabling them to export their products globally. A dedicated committee has been made responsible for aligning the scheme with the specific needs of various industrial sectors. Their role involves educating these industries about the scheme's advantages and assisting them in navigating the process to ensure a smooth and hassle-free application. This approach is highly advantageous for the Indian industrial landscape, as it opens opportunities for all sectors to offer resources to international markets.

Eligibility criteria of the RoDTEP scheme

Below is the eligibility criteria of the scheme3:
• The RoDTEP scheme extends its advantages to all industries, including the textile sector. Industries with a labour-intensive focus that already receive benefits through the MEIS Scheme will be given priority.
• This program is open to both manufacturer exporters and merchant exporters (traders).
• There is no specific minimum revenue requirement for eligibility under the RoDTEP. However, goods that are intended for re-export are not eligible for this program.
• To qualify for the benefits, the exported goods must have their origin in India.
• Special Economic Zone Units and Export-Oriented Units are also entitled to claim the benefits offered by this scheme.
• The RoDTEP scheme also applies to products exported through courier services using e-commerce platforms.

Ineligible products and categories under RoDTEP scheme

Some of the categories that are not eligible for rebates under the RoDTEP scheme are2:

i. Exports of goods that were originally imported for export purposes
ii. Exports involving trans-shipments refer to goods originating in a third country but rerouted through India
iii. Exported products are subject to a minimum export price or export duty
iv. Products restricted or prohibited for export
v. Deemed exports
vi. Supplies of products made by units in the Domestic Tariff Area (DTA) to Special Economic Zone (SEZ) or Free Trade and Warehousing Zone (FTWZ) units
vii. Products manufactured in Export-Oriented Units (EOUs) under the Electronic Hardware Technology Park (EHTP) and Bio-Technology Park (BTP)
viii. Products made partially or entirely within a warehouse, such as Manufacture and Other Operations in Warehouse (MOOWR)
ix. Goods manufactured or exported to fulfil export obligations under advance authorisations, Duty-Free Import Authorizations (DFIA), or Special Advance Authorizations issued within a duty exemption scheme
x. Goods manufactured or exported by units licensed as 100% Export Oriented Units (EOUs)
xi. Goods manufactured or exported by units located in Free Trade Zones (FTZ), Export Processing Zones (EPZ), or Special Economic Zones (SEZ)
xii. Exports for which electronic documentation in ICEGATE EDI has not been generated or exports originating from non-EDI ports
xiii. Second-hand goods, which are goods put into use after manufacturing

Documents required to avail RoDTEP scheme benefits

Step-by-step guide to avail benefits under RoDTEP scheme

Below are the commonly followed steps to avail benefits under this scheme5:

Step 1: Creating a credit ledger

1. Visit the official website of ICEGATE and access the "Our Services" section.
2. Click on the "RoDTEP" tab to redirect the user to the login page.
3. Log in using valid credentials or a Class-3 Digital Signature Certificate (DSC).
4. After successful login, the RoDTEP option will become visible on the left panel.
5. If the exporter is not already registered, they can complete the registration process by following the provided advisory via this link:
6. Exporters can then choose the scheme name as "RoDTEP" from a drop-down menu and proceed to create a ledger account.
7. This ledger account enables users to perform various operations, including scrolling through details, accessing scrip details, viewing transaction details, transferring scrip, and approving scrip transfers.

Step 2: Declaring shipping bill

Starting from January 1, 2021, exporters are required to specify in their shipping bill whether they plan to avail RoDTEP benefits for their exported items. Unlike Drawback, no distinct serial numbers are based on a schedule for claiming RoDTEP. RoDTEP rates will be determined per the RITC Code, eliminating the need to declare a separate code or schedule a serial number for RoDTEP.

Step 3: Claim processing scroll generation

Shipping bills that include claims for RoDTEP and/or Drawbacks will now undergo officer intervention based on Risk-Based Targeting by RMS. After the EGM is filed, all Shipping Bills will be routed to RMS. RMS will provide input, and based on this input, Shipping Bills will either be processed by an officer for RoDTEP benefits or will be directly placed in the scroll queue without officer involvement. Once the Shipping Bill is processed for RoDTEP by the officer or with RMS facilitation, it will be placed in the relevant scroll queues.

If an exporter or Shipping Bill is suspended for Drawback, the same suspension will also apply to releasing RoDTEP benefits. The system includes options for officers to generate RoDTEP scrolls. However, these options will remain inactive in the system until the final rates are notified by the Government. Once the scroll is generated, the corresponding amounts will be accessible to the exporter as credits on the ICEGATE portal.

Step 4: Claiming credits and generating and utilising scrip

Upon creating the RoDTEP scroll, the authorised credits will be accessible through the exporter's ICEGATE account for claiming and conversion into a credit scrip. Each user will be assigned a unique Scrip Number, which will be associated with their account. A credit entry will be recorded in the credit Ledger of the user. To view the details of the scrip, the exporter can select from various options within the scrip status dropdown. The exporter will have the ability to consolidate the allowed credits for any number of Shipping Bills at a particular port and generate a credit scrip for these on the ICEGATE portal. Once the scrips are generated, they will appear in the exporter's ledger. They can be utilised to pay eligible duties during imports or transferred to another entity with an Importer Exporter Code (IEC) and a valid ICEGATE registration.

Rate of rebate under RoDTEP scheme

The scheme offers eligible exporters a rebate, which will be granted at a specified rate as a percentage of the Free on Board (FOB) value and a value cap per unit of the exported product, as required. This applies to items categorised under the notified 8-digit HS Code. However, certain export items may also specify a fixed rebate amount per unit. The rebate granted is contingent upon the receipt of sale proceeds within the timeframe prescribed by the Foreign Exchange Management Act of 1999. If this condition is not met, the rebate will be considered as if it was never granted. It's important to note that the rebate is not contingent on the realisation of export proceeds at the time when the rebate is issued.

RoDTEP scheme vs MEIS scheme

RoDTEP scheme

• This scheme allows the refund of only those duties and taxes that are not currently reimbursed by any other scheme.
• It is compliant with WTO norms.
• This scheme issues transferable duty credit or electronic scrips maintained via an electronic ledger.

MEIS scheme

• There are some incentives available on the export of goods.
• It is non-compliant with WTO norms.
• This scheme issues physical transferable scrips.

How to export from India?

Every seller dreams of establishing his brand in the international markets. Whether you’re an exporter, online seller in India, startup or a multi-city store, with Amazon Global Selling, you can export from India with ease irrespective of your business type or size. You can register by submitted a few KYC documents like identity proof, address proof and credit card (to receive and make payments) in 15 minutes and start exporting from India. From manufactures, MSMEs to merchant exporters, all sectors can avail the benefits of this scheme. There is no minimum export or turnover criteria for availing this scheme. However, all exported products should be Indian origin, meaning Made in India. E-commerce export products are also included in this scheme.

Register your business

First, you must register your export business with Amazon Global Selling. You don’t have to be an existing Amazon India seller. The registration can be done online on Seller Central. You’ll need the following documents to register:
• ID proof (Aadhar, driving license or passport)
• Business address proof (Bank statement)
• Credit or debit card (international transactions enabled)
Amazon seller registration

List your products

Once you have successfully registered to sell globally on Amazon, you can list your products. Remember to follow tips on how to list your products include attractive pictures and descriptions that’s clear to international customers. You can also seek help from third party service providers.
How to list your products on Amazon

Ship and receive payments

Once a customer places an order, you can choose to deliver by yourself or you can opt for Fulfillment by Amazon (FBA). Under FBA, Amazon takes care of shipping, delivery, returns and customer concerns. Once a customer purchases your product, Amazon credits the money in your bank account in the currency of your choice.
Amazon FBA

Frequently Asked Questions

Who can claim the RoDTEP scheme?
From manufactures, MSMEs to merchant exporters, all sectors can avail the benefits of this scheme. There is no minimum export or turnover criteria for availing this scheme. However, all exported products should be Indian origin, meaning Made in India. E-commerce export products are also included in this scheme.
When did RoDTEP scheme start?
This scheme came into effect in January, 2021 replacing the old MEIS scheme.
Which industries are covered under the RoDTEP Scheme?
Sectors with a strong focus on generating employment, such as marine, agriculture, leather, gems and jewellery, and textile industry, are included in the RoDTEP scheme. Additionally, sectors like automobiles, plastics, electrical/electronics, machinery, and others receive support from the RoDTEP scheme.
Published on December 8, 2021.


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