India does not subsidise exports directly. What it does, through the Foreign Trade Policy, the Customs Act and GST, is try to make sure that an exporter does not carry Indian taxes into the price it quotes abroad. Each scheme removes a different layer of tax at a different point in the chain: on imported inputs, on capital goods, on fuel and electricity, on GST paid to suppliers. The result is a menu of more than a dozen schemes, several of which cannot be used together. Most exporters we meet use one or two and leave money on the table on the rest.
The main export benefits available in India in 2026 are: RoDTEP (a refund of embedded taxes, paid as transferable duty credit scrips, notified up to 31 December 2026); duty drawback (a refund of customs duty on inputs); Advance Authorisation and DFIA (duty-free import of inputs against an export obligation); EPCG (duty-free capital goods against six times the duty saved in exports); MOOWR (duty-deferred manufacturing in a bonded warehouse); EOU and SEZ units; GST refunds on zero-rated exports; status holder recognition; and the Export Promotion Mission's interest subvention, credit and market access support. The right combination depends on how much of your input is imported, whether you sell in India too, and how much capital equipment you buy.
All export schemes at a glance
| Scheme | What it gives | Administered by | Best for |
|---|---|---|---|
| RoDTEP | Refund of non-creditable central, state and local taxes embedded in exports, as e-scrips usable for customs duty or sold | DGFT and Customs (ICEGATE) | Almost every goods exporter, at product-wise rates in Appendix 4R |
| RoSCTL | Rebate of state and central taxes for apparel and made-ups | Ministry of Textiles, Customs | Garment and home-textile exporters |
| Duty drawback | Refund of customs duty on imported inputs used in exports, at All Industry Rates or a brand rate | Customs | Exporters whose imported content is modest or irregular |
| Advance Authorisation | Duty-free import of inputs physically incorporated in the export product, against an export obligation | DGFT, then Customs | Regular exporters with high imported content and stable input-output norms |
| DFIA | Duty-free import entitlement issued after export; transferable once the obligation is met | DGFT | Exporters who would rather sell the entitlement than use it |
| EPCG | Zero-duty import of capital goods against exports of six times the duty saved over six years | DGFT, then Customs | Manufacturers buying imported machinery |
| MOOWR | Duty-deferred import and manufacturing in a bonded warehouse; duty never paid on what is exported | Customs (jurisdictional Commissionerate) | Units that sell both abroad and in India, or cannot fix input-output norms |
| EOU and SEZ | Duty-free imports and domestic procurement for a unit that exports its production | Development Commissioner | Large, export-dedicated facilities |
| GST refund | Refund of IGST paid on export, or of input tax credit for exports under LUT | Customs and GST officers | Every exporter of goods and services |
| Export Promotion Mission | Interest subvention, collateral and credit support (Niryat Protsahan); market access, logistics and branding support (Niryat Disha) | DGFT and partner agencies | MSME exporters, new markets |
RoDTEP and RoSCTL
The Remission of Duties and Taxes on Exported Products refunds taxes that never come back through GST credit or drawback: duty on fuel used in transport, electricity duty, mandi tax, stamp duty on export documents and the like. It is claimed on the shipping bill itself by declaring the intention to claim RoDTEP, and the entitlement is issued as an electronic scrip in the exporter's ICEGATE ledger. The scrip can pay basic customs duty on imports, or be transferred to another importer, usually at a small discount.
- Rates are product-wise, by 8-digit tariff line, as a percentage of FOB value with a per-unit cap, in Appendix 4R (and 4RE for AA, EOU and SEZ exports).
- Validity. DGFT Notification 41/2026-27 dated 30 September 2026 extends RoDTEP, including for Advance Authorisation, EOU and SEZ exports, to 31 December 2026. Nothing beyond that date is notified yet.
- Exclusions include goods manufactured or exported in or from a Section 65 bonded warehouse (MOOWR), deemed exports, and supplies to SEZ units.
- RoSCTL runs in parallel for apparel and made-ups, and has also been extended to 31 December 2026.
Duty drawback
Drawback refunds customs duty paid on imported inputs used in the export product. The All Industry Rates schedule (Notification 77/2023-Customs (N.T.), amended periodically) gives a rate per tariff item, credited automatically once the shipping bill and EGM are processed. Where the AIR does not reflect your actual duty incidence, a brand rate can be fixed for your product on application to the jurisdictional Commissioner under Rules 6 and 7 of the Drawback Rules, 2017.
The current schedule has a single rate and a per-unit cap for each tariff item; the old A and B columns from the pre-GST era no longer exist. Condition 9 of the notification bars All Industry Rates on goods made in a Section 65 warehouse and on exports under Advance Authorisation, DFIA, EOU and SEZ, so exporters in those schemes should not tick drawback on the shipping bill by habit.
Advance Authorisation and DFIA
An Advance Authorisation lets a manufacturer exporter, or a merchant exporter tied to a supporting manufacturer, import inputs free of basic customs duty, IGST, compensation cess and anti-dumping, countervailing and safeguard duty (except on certain deemed-export supplies). In return it commits to export a specified quantity and value, with a minimum 15% value addition, within 18 months of issue. Quantities are fixed by the Standard Input Output Norms (SION) for the product, or by self-declared norms ratified by the Norms Committee where no SION exists. The authorisation is closed with an Export Obligation Discharge Certificate (EODC).
The Duty Free Import Authorisation works the other way round: the exporter exports first, then applies for an entitlement to import the same inputs duty-free. Once the export obligation is met the DFIA is transferable, which suits exporters who have no use for the inputs themselves.
EPCG for capital goods
The Export Promotion Capital Goods scheme under Chapter 5 of the Foreign Trade Policy 2023 allows capital goods to be imported at zero customs duty, or bought domestically without the tax burden, for pre-production, production and post-production use. The obligation is to export goods or services worth six times the duties, taxes and cess saved, within six years from issue, with at least half achieved in the first four years. For a manufacturer buying a significant imported machine, EPCG is often the single largest saving available, and it can run alongside an Advance Authorisation for the inputs.
MOOWR bonded manufacturing
The Manufacture and Other Operations in Warehouse Regulations, 2019 let a business licence part of its premises as a private bonded warehouse under Section 58 of the Customs Act and manufacture there under Section 65. Imported inputs and capital goods enter without paying any duty. Duty on the inputs is never paid on what is exported, and is paid without interest on what is cleared into India. There is no export obligation, no value addition floor, no norms fixation and normally no bank guarantee, and the licence does not expire.
The price is that goods made in a Section 65 warehouse lose RoDTEP and All Industry Rate drawback, the premises come under customs control with monthly returns, and imported goods must reach the bonded premises before going to a job worker. We set out the full procedure in our MOOWR registration guide and the trade-off in MOOWR vs Advance Authorisation.
EOU and SEZ units
An Export Oriented Unit under Chapter 6 of the Foreign Trade Policy, or a unit in a Special Economic Zone under the SEZ Act, 2005, imports and buys domestically without duty and must stay net foreign exchange positive over its block period. Supplies to SEZ units are zero-rated under GST. These are structural choices rather than schemes you claim shipment by shipment, and suit large facilities whose production is mostly exported. For 2026-27 the Budget opened a one-time window for SEZ manufacturing units to sell a capped share of output into India at concessional duty, valid from 1 April 2026 to 31 March 2027.
GST refunds on exports
Exports are zero-rated. A goods exporter can pay IGST on the export and have it refunded automatically through the shipping bill, or export under a Letter of Undertaking without paying IGST and claim a refund of accumulated input tax credit in RFD-01. Services exporters use the LUT route. In 2026 the Supreme Court settled that the omission of Rule 96(10), which used to block the IGST route for Advance Authorisation and EPCG importers, applies to pending cases. Read our guide to GST refunds on exports for the formula, the ICEGATE error codes and the timelines.
Export Promotion Mission, credit support and status holders
Export Promotion Mission. Approved by the Union Cabinet on 12 November 2025 with an outlay of ₹25,060 crore for FY 2025-26 to FY 2030-31 and run by DGFT. It has two arms. Niryat Protsahan covers trade finance: interest subvention on rupee export credit for a positive list of products, with an additional rate for notified emerging markets, plus collateral support and credit enhancement for MSMEs. It replaces the Interest Equalisation Scheme, which ended on 31 December 2024. Niryat Disha covers non-financial support: market access assistance for fairs and buyer-seller meets, logistics and overseas warehousing, and branding. Market access guidelines were issued in Trade Notice 19/2025-26 and amended in July 2026.
Credit Guarantee Scheme for Exporters. Announced in November 2025, it gives a 100% guarantee through NCGTC on additional working capital of up to 20% of an exporter's existing export credit limits, capped at ₹50 crore per borrower, through the lending bank. Check with your bank whether the scheme window is still open.
Status holders. Exporters are recognised as One Star to Five Star Export Houses on export performance over the current and previous three years, from USD 3 million for One Star up to USD 800 million for Five Star, with double weightage for MSMEs at the One Star level. Status brings self-certification, priority customs treatment and, importantly, an exemption from bank guarantees under several schemes, including Advance Authorisation.
Districts as Export Hubs. Each district has an export action plan under Chapter 3 of the Foreign Trade Policy, and district export promotion committees can be a route to local support for export clusters.
Which schemes can be combined
| If you use | RoDTEP | AIR drawback | GST refund | EPCG |
|---|---|---|---|---|
| Advance Authorisation | Yes, at Appendix 4RE rates, while notified | No All Industry Rate; brand rate possible on duty-paid inputs outside the norms (para 4.15) | Yes, LUT or IGST route | Yes |
| MOOWR | No, on goods made in the warehouse | No | Yes | Not needed: capital goods can be bonded too |
| EOU or SEZ | Yes, while notified for these units | No: All Industry Rates are barred for EOU and SEZ exports | Zero-rated by design | Not needed |
| Duty-paid imports | Yes | Yes | Yes | Yes |
Each scheme's conditions are notified separately and change. Check the RoDTEP appendix, the drawback notification and the Foreign Trade Policy in force on the date of export.
How to choose: four questions
- How much real duty do your imports carry?Add up basic customs duty, social welfare surcharge and anti-dumping or safeguard duty from last year's bills of entry. Leave IGST out. Many lines already carry nil duty under trade agreements or exemptions and add nothing.
- What do you currently get in RoDTEP and drawback?Take the actual credits from your ICEGATE ledger and drawback sanctions, not memory. This is what a scheme might cost you.
- Do you sell any of the product in India?If yes, MOOWR's freedom to clear goods domestically without interest may be worth more than Advance Authorisation's RoDTEP. If you are fully export-oriented, Advance Authorisation usually wins.
- Can a classification or sourcing review do the job without a scheme?A part declared under the wrong tariff heading, or anti-dumping duty that applies only to some producers, can sometimes be fixed for a fee note, with no bond and no loss of incentives.
We work through exactly this sequence with exporters. See our export incentives and customs schemes service for how we scope it.
Frequently Asked Questions
RoDTEP and RoSCTL (refund of embedded taxes), duty drawback, Advance Authorisation and DFIA (duty-free inputs), EPCG (duty-free capital goods), MOOWR (bonded manufacturing), EOU and SEZ units, GST refunds on zero-rated exports, status holder benefits, and the Export Promotion Mission, which provides interest subvention, credit support and market access assistance.
Yes. DGFT Notification 41/2026-27 dated 30 September 2026 extends RoDTEP, including for exports under Advance Authorisation, EOU and SEZ, up to 31 December 2026. No extension beyond that date had been notified when this article was written, so check the latest DGFT notification before relying on it.
Yes. Drawback refunds customs duty on inputs and RoDTEP refunds other embedded taxes, so both can be claimed on the same shipping bill if the product qualifies for each. What you cannot do is claim All Industry Rate drawback on inputs imported duty-free under Advance Authorisation, or claim either benefit on goods made in a MOOWR bonded warehouse.
The Interest Equalisation Scheme ended on 31 December 2024. Its successor is Niryat Protsahan, the trade finance arm of the Export Promotion Mission approved by the Cabinet in November 2025, which provides interest subvention on export credit for a positive list of products along with collateral and credit enhancement support for MSMEs.
For a fully export-oriented business with stable input-output norms, Advance Authorisation usually gives the better net result because RoDTEP remains available. MOOWR suits businesses that also sell in India, cannot fix norms, or want no export obligation, but goods made under it lose RoDTEP and All Industry Rate drawback.
The main benefit for services exporters is zero-rating under GST, with a refund of input tax credit for exports under LUT. EPCG is available against service exports, status holder recognition counts service exports, and market access support under the Export Promotion Mission covers service sectors. RoDTEP and drawback apply only to goods.
Sources and law referred to
- Authority: Directorate General of Foreign Trade. Title: Foreign Trade Policy 2023 and Handbook of Procedures 2023, Chapters 1, 3, 4, 5 and 6; Appendix 4R and 4RE (RoDTEP rates); Notification 41/2026-27 dated 30 September 2026. View Source. Accessed: November 2026.
- Authority: CBIC. Title: Customs Act, 1962, sections 58, 65 and 75; Manufacture and Other Operations in Warehouse (No. 2) Regulations, 2019; Customs and Central Excise Duties Drawback Rules, 2017; Notification 77/2023-Customs (N.T.). View Source. Accessed: November 2026.
- Authority: Press Information Bureau. Title: Cabinet approves Export Promotion Mission and Credit Guarantee Scheme for Exporters, November 2025. View Source. Accessed: November 2026.
- Authority: CBIC. Title: IGST Act, 2017, section 16; CGST Rules, 2017, rules 89 and 96; Circular 264/10/2026-GST. View Source. Accessed: November 2026.
Positions are as read on November 4, 2026. Export incentives are notified for fixed periods and change often; confirm the notification in force on the date of your shipment or filing. This article is general information, not advice on your facts.
Talk to CA Karan Shah about your export benefits
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Written by CA Karan Shah
Founder of KC Shah & Associates, Chartered Accountants, Andheri East, Mumbai (ICAI Membership No. 190724). Advises manufacturers and exporters on MOOWR, Advance Authorisation, RoDTEP and drawback, and GST export refunds, alongside GST compliance and outsourced accounting in Tally and Zoho Books.