India’s export duty savings schemes let exporters either import inputs without paying customs duty (Advance Authorisation and DFIA) or get back duties and taxes already paid on inputs (Duty Drawback, RoDTEP and RoSCTL). Their purpose is to keep Indian taxes out of the price of exported goods so that they can compete abroad. Officially they are called Duty Exemption and Remission Schemes, and they are set out in Chapter 4 of the Foreign Trade Policy (FTP) 2023.
This guide explains each scheme in plain language. Status checked in October 2026: RoDTEP and RoSCTL have both been extended to 31 December 2026, so check for further extensions after that date.
What export duty savings schemes do
Making an export product involves taxes and duties on raw materials, fuel, packaging and services. The schemes deal with these costs in one of two ways: they allow duty-free import of raw materials, or they refund taxes and duties already paid on inputs used to make export goods. The principle is simple: exports should not carry the burden of Indian taxes.
The two types of scheme
India uses two approaches (paragraph 4.01 of the FTP lists the individual schemes):
A. Duty exemption schemes
You do not pay duty on the inputs at all. Advance Authorisation and DFIA work this way.
B. Duty remission schemes
You pay duty or tax first and get it back later. Duty Drawback works this way, and RoSCTL and RoDTEP refund other embedded taxes after export.
Advance Authorisation (AA), the most common scheme
Advance Authorisation lets you import raw materials without paying customs duty, provided you use them to manufacture goods for export. A garment exporter, for example, can import fabric, buttons or lining duty-free and then export the finished garments.
Main conditions
- The imported inputs must actually be used in the exported goods.
- Exports must be completed within a fixed time (normally 18 months from the date the authorisation is issued).
- A minimum value addition is required: 15% under paragraph 4.09 of the FTP, with higher figures for some products such as tea (50%) and spices (25%).
- It is widely used by both manufacturer exporters and merchant exporters.
Because duty is never paid, the scheme reduces upfront costs and working capital pressure on exporters.
Duty Free Import Authorisation (DFIA)
Under DFIA you export goods first and then get the right to import inputs duty-free. The difference from Advance Authorisation is the order: AA means import first and export later; DFIA means export first and import later.
Why exporters choose DFIA
DFIA is transferable once the export obligation has been met, so an exporter who does not need the inputs can sell the authorisation. It also suits exporters who do not want pre-export conditions. The minimum value addition under DFIA is higher than under AA: 20%, against 15%.
Duty Drawback
If you paid duty on inputs used in exported goods, Duty Drawback refunds it at a rate notified in advance. For example, if you imported packing material and paid duty on it, then used it for an export shipment, you get a refund at the notified rate.
Drawback is administered by Customs (the Department of Revenue). The All Industry Rates are pre-notified and cover customs duty on inputs and central excise duty on petroleum products. GST is not refunded through drawback; GST paid on inputs is recovered separately through the GST refund route for exports. The scheme is very useful for small exporters.
RoDTEP: refund of embedded taxes
RoDTEP stands for Remission of Duties and Taxes on Exported Products. It was introduced because some taxes, such as electricity duty, mandi tax and other local levies, were not refunded under GST or drawback. RoDTEP refunds these embedded costs.
How it works
- The exporter receives an electronic duty credit (e-scrip).
- The credit can be used to pay Basic Customs Duty on imports.
- Rates are linked to HS codes: they are notified tariff line by tariff line, with value caps, in Appendix 4R of the FTP (Appendix 4RE for exports by Advance Authorisation holders, EOUs and SEZ units).
RoDTEP applies to most goods exports unless they are specifically excluded. The scheme is notified by the Department of Commerce and administered by the Department of Revenue. As of October 2026 it has been extended to 31 December 2026 (DGFT Notification No. 41/2026-27 of 30 September 2026), with rates unchanged.
RoSCTL: the scheme for apparel and made-ups
RoSCTL (Rebate of State and Central Taxes and Levies) is for exporters of garments and made-ups. It refunds state and central taxes that are not covered by other schemes. It is notified by the Ministry of Textiles specifically for this sector. Garments and made-ups covered by RoSCTL are not eligible for RoDTEP, so the two schemes run in parallel for different products. As of October 2026 it has been extended to 31 December 2026.
Which scheme should an exporter choose?
| Exporter situation | Suitable scheme |
| Manufacturer importing raw materials | Advance Authorisation |
| Exporter wants post-export benefit | DFIA |
| Small exporter with duty-paid inputs | Duty Drawback |
| Exporter facing hidden local taxes | RoDTEP |
| Garment and made-ups exporter | RoSCTL |
Exporters often use a combination of schemes, depending on eligibility. Capital goods are covered by a separate scheme, Export Promotion Capital Goods (EPCG), in Chapter 5 of the FTP, which this guide does not cover.
Common mistakes exporters should avoid
- Selecting the wrong HS code. RoDTEP and drawback rates are notified by tariff line, so a wrong code means a wrong claim (see common HS classification mistakes).
- Claiming more than one benefit for the same duty.
- Missing export obligation deadlines.
- Poor documentation.
- Not matching imported inputs with the export product.
Most rejections and audit objections come from documentation gaps. A classification file that records why each code was chosen helps; building an audit-proof HS classification file explains how.
The point of these schemes
India’s export duty savings schemes are designed to make exports tax-neutral and competitive abroad. Choosing the right scheme can improve profit margins and cash flow. These schemes are not incentives or subsidies. They ensure that Indian taxes do not travel outside India with exported goods. Used correctly, they support export growth under the Foreign Trade Policy 2023, including India’s target of $2 trillion in exports by 2030 (see why HSN classification matters to that goal).