A focus on fiscal austerity and spending limits should not come in the way of ensuring zero rating for exports, India’s apex exporters’ body urged the Finance Ministry on Tuesday, signalling the need to enhance outlays for the Remission of Duties, Taxes on Export Products (RoDTEP) scheme.
In a Budget consultation meeting with trade and services representatives chaired by Finance Minister Nirmala Sitharaman, Federation of Indian Exporters’ Organisations (FIEO) President Ashwani Kumar said zero rating of exports is an “avowed policy” of the Government and should not be limited owing to budget constraints.
Zero rating of exports means no domestic taxes are added to goods meant for export and the RoDTEP scheme is aimed at refunding any such duties incurred in the production or export process to the exporter, but had excluded some sectors.
Launched in January 2021 to replace an earlier export incentive scheme that was seen as non-compliant with World Trade Organization (WTO) norms, RoDTEP has a Budget of ₹15,070 crore in 2024-25, and provided support worth ₹42,000 crore to exporters till date.
In March this year, the Centre announced an extension of the RoDTEP benefits to special economic zones and export-oriented units that account for a quarter of India’s exports, but only till September 30, citing budgetary allocations.
Mr. Kumar also sought a five-year extension for the Interest Equalisation Scheme for exporters that expires this month, and a restoration of the subvention rates under the scheme from 3% to 5% for micro, small and medium manufacturers and 2%-3% for all exporting producers.
Later in the day, Ms. Sitharaman also held a consultation on education, skilling, and employment with domain experts.
