The government has announced that the scope of the Remission of Duties and Taxes on Exported Products (RoDTEP) Scheme will be expanded to include Chemicals, Pharmaceuticals, and Iron and Steel articles beginning December 15, 2022.
In an effort to boost exports, the government announced today that the RoDTEP Scheme will be expanded to include shipments from the chemical and pharmaceutical industries, as well as shipments of iron and steel listed in chapters 28, 29, 30, and 73 of the International Trade Classification (HS) system, according to a statement issued by the Ministry of Commerce & Industry. As of December 15th, 2022, the expanded list of items will be eligible for export under the RoDTEP Scheme.
This has been a long-pending demand in the business community, and its fulfilment will have far-reaching effects on our exports and competitiveness in global markets, job creation, and economic growth. Appendix 4R will now include 10,342 export items, up from the current total of 8,731 export items (8-digit tariff lines).
RoDTEP is based on the globally acknowledged principle that taxes and duties should not be exported, and that taxes and levies levied on exported goods should be exempted or remitted to exporters. The RoDTEP scheme rebates or refunds to exporters the embedded central, state, and local duties and taxes that were previously not rebated or refunded. The scheme came into effect on January 1, 2021, with the rebate being issued as a transferable electronic scrip by the Central Board of Indirect Taxes and Customs (CBIC) in an end-to-end IT environment.
It’s important to recognise the efforts the government is making to bolster domestic industry and boost its competitiveness on the global stage. Industries with an eye toward export are undergoing reform, and new mechanisms are being put in place, in the hopes of making them more competitive, thereby increasing exports, generating economic growth, and providing more employment opportunities. As a result, we will be closer to realising our vision of an Aatmanirbhar Bharat.
The extension of RoDTEP to unrecognised sectors like chemicals, pharmaceuticals, and iron and steel articles is likely to boost the export competitiveness of these sectors at a time when exports are facing headwinds due to signs of recession in some developed markets and supply chain disruptions due to the Russia-Ukraine conflict.