Why Export Incentives Matter for Indian Businesses

India’s export ecosystem is one of the most dynamic in the world, supported by a robust framework of government-backed incentive schemes. If you are an exporter, manufacturer, or trade professional operating in India in 2026, understanding these incentive programmes is not just beneficial — it is essential to your business profitability and global competitiveness.

The Indian government, through the Ministry of Commerce and Industry and the Directorate General of Foreign Trade (DGFT), has established multiple schemes to help exporters reduce the cost of production, recover taxes paid on inputs, and boost the country’s overall export performance. The three most critical and widely used schemes in 2026 are:

• MEIS — Merchandise Exports from India Scheme (now largely transitioned to RoDTEP)
• RoDTEP — Remission of Duties and Taxes on Exported Products
• Advance Authorisation Scheme — Duty-free import of inputs for export production

This comprehensive guide will walk you through each scheme in detail — their purpose, eligibility criteria, benefits, rate structures (updated for 2026), claim procedures, and how to maximise your returns as an Indian exporter.

India’s merchandise exports crossed USD 437 Billion in FY 2024-25. Export incentive schemes play a pivotal role in maintaining India’s price competitiveness in global markets.

CHAPTER 1: MEIS — Merchandise Exports from India Scheme

1.1 What is MEIS?

The Merchandise Exports from India Scheme (MEIS) was introduced under the Foreign Trade Policy (FTP) 2015-20 by the Government of India. The scheme was designed to offset infrastructural inefficiencies and associated costs involved in exporting products from India, making Indian goods more competitive in the global market.

MEIS replaced five earlier schemes — Focal Point Rebate Scheme, Vishesh Krishi and Gram Udyog Yojana (VKGUY), Market Linked Focus Product Scheme (MLFPS), Focus Product Scheme (FPS), and the Agri Infrastructure Incentive Scrip (AIIS).

IMPORTANT NOTE (2026): The WTO Dispute Settlement Body ruled against MEIS in 2019, as it violated WTO’s Agreement on Subsidies and Countervailing Measures (ASCM). The Government of India subsequently phased out MEIS and replaced it with the RoDTEP Scheme (effective from January 2021). However, exporters may still have pending MEIS scrip claims for exports made before the scheme’s closure, and understanding MEIS remains critical for claim resolution.

1.2 MEIS — Benefits & Incentive Structure

Under MEIS, exporters received transferable duty credit scrips equivalent to 2%, 3%, or 5% of the FOB (Free on Board) value of exports, depending on the product category and destination country. These scrips could be used to:

• Pay Basic Customs Duty (BCD) on imports
• Pay Central Excise Duty on domestic procurement
• Pay Service Tax (before GST implementation)

1.3 MEIS — Eligibility Criteria

To claim MEIS benefits (for pending claims under old exports), the following conditions must be met:

1. Exports must be of products specified in the MEIS Schedule (Appendix 3B of FTP)
2. Exports must be made from EDI (Electronic Data Interchange) enabled ports or notified ports
3. The shipping bill must be filed through ICES (Indian Customs EDI System)
4. Exports should be in Free Foreign Exchange (not barter, counter trade, or re-export of imported goods)
5. The entity must hold a valid Import Export Code (IEC)

1.4 MEIS — Pending Claim Procedure (2026)

If you have unclaimed MEIS scrips for exports made before December 31, 2020, you can still file claims. Here is the step-by-step process:

6. Login to the DGFT portal: dgft.gov.in using your IEC credentials
7. Navigate to Services > MEIS > Online Application
8. Upload the required documents: Shipping Bills (EDI), Bank Realisation Certificate (BRC/e-BRC), RCMC, and IEC
9. Submit application along with applicable fees
10. The Regional Authority (RA) of DGFT will process and issue the scrip
11. Use the e-scrip on the ICEGATE portal for customs duty payment

CHAPTER 2: RoDTEP — Remission of Duties and Taxes on Exported Products

2.1 What is RoDTEP?

The Remission of Duties and Taxes on Exported Products (RoDTEP) scheme is the successor to MEIS and is fully WTO-compliant. Launched on January 1, 2021, and significantly expanded in subsequent years, RoDTEP aims to refund all previously unrebated taxes, duties, and levies borne by exporters at the Central, State, and local level during the manufacturing and distribution of export goods.

Unlike MEIS (which was a subsidy-like incentive), RoDTEP strictly remits only the actual taxes paid by the exporter which were embedded in the cost of production but not otherwise refunded. This makes it WTO-compliant and sustainable in the long run.

RoDTEP is NOT a subsidy. It is a remission of actual taxes paid. This includes State taxes on power, fuel, mandi fees, local body levies, and other costs that were embedded in the product price but not refunded under GST or Duty Drawback.

2.2 RoDTEP Rates — Updated 2026

The Government of India has released and revised RoDTEP rates through DGFT Notifications. The rates are expressed as a percentage of the FOB value of exports and are product-specific based on ITC-HS codes. In Budget 2025-26 (Union Budget presented in February 2026), the government continued extending RoDTEP benefits with revised rate schedules.

Note: RoDTEP rates are updated periodically. Exporters must refer to the latest DGFT notification and the RoDTEP rate schedule annexed to each notification for exact rates applicable to their ITC-HS code.

2.3 RoDTEP — How it Works (Mechanism)

RoDTEP benefits are issued as electronic transferable scrips (e-scrips) credited directly to the exporter’s account on the ICEGATE portal. These scrips can be used to pay Basic Customs Duty on imports or transferred to other importers against payment.

The entire process is digital, paperless, and integrated with the Customs EDI system through shipping bill data. There is no physical scrip — everything is electronic.

2.4 Eligibility for RoDTEP

The following categories of exporters are eligible for RoDTEP benefits:

• Manufacturer exporters and merchant exporters with valid IEC
• Exporters of products listed in the RoDTEP rate schedule (notified HS codes)
• Exports made from SEZs are also eligible (from 2023 onwards, after government extension)
• Exports by EOUs (Export Oriented Units) on specific qualifying exports

The following are NOT eligible for RoDTEP:

• Exports of products not listed in the RoDTEP rate schedule
• Deemed exports (supplies to EOU, SEZ, EPCG licence holders)
• Products already receiving full duty remission through other channels
• Export of services

2.5 RoDTEP — Claim Procedure

12. Log in to ICEGATE (icegate.gov.in) with your IEC/GSTIN credentials
13. Declare the RoDTEP claim in the shipping bill at the time of filing (Column: RoDTEP = Y)
14. After Let Export Order (LEO), the Customs system automatically processes the claim
15. Credits are transferred to your RoDTEP e-scrip wallet within 7–10 working days of EGM (Export General Manifest) filing
16. Transfer or utilise the e-scrip on ICEGATE for import duty payment

2.6 RoDTEP — Rupee Value Example

Example: A textile exporter from Surat exports goods worth INR 50,00,000 (Rs. 50 Lakhs) FOB. If the applicable RoDTEP rate for their HS code is 3.5%, then the RoDTEP benefit = 50,00,000 x 3.5% = INR 1,75,000. This amount is credited as e-scrip and can be used to offset import duties or sold to another importer.

2.7 RoDTEP — Important Notifications & Circulars (2026)

• DGFT Notification No. 19/2021-22: Initial RoDTEP rate schedule
• DGFT Notification No. 33/2021-22: Expanded product list including more HS codes
• Customs Circular No. 14/2021: Implementation guidelines for e-scrip
• Union Budget 2025-26 (February 2026): Continuation and expansion of RoDTEP for further years
• Ministry of Finance OM (2026): Extension of RoDTEP to SEZ exporters and certain EOU categories

CHAPTER 3: Advance Authorisation Scheme

3.1 What is the Advance Authorisation Scheme?

The Advance Authorisation (AA) Scheme is one of the oldest and most powerful export incentive mechanisms under the Foreign Trade Policy of India. It allows exporters to import raw materials, components, consumables, and other inputs required for the manufacture of export goods completely duty-free, prior to export.

The scheme is governed by the DGFT under the Foreign Trade Policy 2023-28 (currently in effect) and Handbook of Procedures (HBP). It is based on the principle that taxes and duties should not be exported — inputs used for producing goods that are ultimately exported should be exempt from import duties.

3.2 Types of Advance Authorisation

3.3 What Imports are Allowed Duty-Free?

Under the Advance Authorisation scheme, the following categories of imports are allowed duty-free:

• Raw materials and components (as per Standard Input Output Norms — SIONs)
• Fuel, oil, and energy (as per SION where specified)
• Catalysts, consumables, and packing materials
• Mandatory spares (up to 10% of CIF value in certain categories)

The duty exemption covers Basic Customs Duty (BCD), Additional Customs Duty (ACD), Education Cess, Anti-dumping Duty, Countervailing Duty (CVD), and Special Additional Duty (SAD) — where applicable.

3.4 Standard Input Output Norms (SIONs)

SIONs are pre-determined norms established by the Norms Committee (under DGFT) that specify the quantity of inputs required to produce one unit of a given export product. These norms are used to fix the quantity of duty-free imports allowed under Advance Authorisation.

Example: SION for Export of Men’s Cotton Shirts (HS 6205): Fabric requirement may be defined as 2.5 metres per piece, plus specified quantities of thread, buttons, and packing material.

If the applicable SION does not match an exporter’s specific production process, they can apply for fixation of Ad-hoc norms or self-declared norms (with post-export audit).

3.5 Export Obligation under Advance Authorisation

The key condition of the Advance Authorisation scheme is that the exporter must fulfil an Export Obligation (EO) — i.e., they must export goods of a specified value/quantity within the specified time period.

3.6 Advance Authorisation — Rupee Value Example

Example: A pharma company in Ahmedabad needs to import Active Pharmaceutical Ingredients (APIs) worth INR 1,00,00,000 (Rs. 1 Crore) CIF, attracting Basic Customs Duty of 10% = INR 10,00,000. By obtaining an Advance Authorisation, the company saves INR 10,00,000 in import duties, provided it fulfils the export obligation of INR 1,15,00,000 (15% value addition) within 18 months.

3.7 How to Apply for Advance Authorisation

17. Register on DGFT portal (dgft.gov.in) with valid IEC, DSC, and GSTIN
18. File the ANF-4A application form online under Services > Advance Authorisation
19. Select the applicable SION or request ad-hoc norms fixation
20. Pay the applicable processing fee (ranges from INR 200 to INR 10,000 depending on value)
21. DGFT Regional Authority reviews and issues the Authorisation Letter
22. Register the AA at the Port of Import with Customs (ICEGATE)
23. Import goods duty-free against the registered AA
24. Fulfill export obligation within the prescribed time
25. Submit Export Obligation Discharge Certificate (EODC) to DGFT after completing exports

3.8 Regularisation & Penalties for Non-Fulfilment (2026)

In case an exporter fails to fulfil the Export Obligation within the stipulated time, the following consequences apply:

• Payment of all duties saved along with 15% penalty on the duty amount
• Interest @ 15% per annum on the duty amount from the date of import
• In case of serious default, prosecution under the Foreign Trade (Development & Regulation) Act, 1992

However, exporters can regularise their position by applying under DGFT’s Regularisation Policy (with payment of applicable fees and penalties) to avoid prosecution and close the case.

CHAPTER 4: MEIS vs RoDTEP vs Advance Authorisation — Quick Comparison

CHAPTER 5: Combination Strategy — Maximising Export Benefits

5.1 Can You Claim Multiple Schemes Together?

Yes! Indian exporters can often combine multiple incentive schemes to maximise their savings. However, there are specific rules on clubbing and double-dipping restrictions.

5.2 Key Compliance Points for 2026

• Always declare your scheme election on the Shipping Bill — once declared, it generally cannot be revised
• Maintain proper books of accounts and input-output records for audit purposes
• Keep all e-BRC (Electronic Bank Realisation Certificates) updated for all export proceeds
• File EODC (for AA) within 90 days of fulfilling the export obligation
• Monitor DGFT circulars and notifications regularly for rate revisions
• Use the Duty Calculator on ICEGATE to compute applicable benefits before filing

5.3 Common Mistakes Exporters Make

• Not declaring RoDTEP at the time of shipping bill filing (cannot be claimed afterwards)
• Importing goods under AA but failing to maintain SION-compliant consumption records
• Not applying for AA before imports begin (AA must be obtained PRIOR to import)
• Missing the Export Obligation deadline without seeking extension
• Not transferring or utilising e-scrips before their validity expires (currently 24 months)

CHAPTER 6: Key Policy Updates & Notifications in 2026

6.1 Foreign Trade Policy 2023-28 — Highlights

The Foreign Trade Policy (FTP) 2023-28, released on April 1, 2023, is currently in effect and provides the overarching framework for all export incentive schemes including RoDTEP and Advance Authorisation.

• RoDTEP extended and rates revised upward for key sectors
• Advance Authorisation norms simplified — online SION query system upgraded
• Town of Export Excellence (TEE) status granted to new clusters
• Amnesty Scheme for Export Obligation defaults introduced and extended
• DESH (Development of Enterprise and Service Hubs) Bill — SEZ reforms impacting AA and RoDTEP eligibility

6.2 Union Budget 2025-26 (Presented February 2026)

• RoDTEP allocation increased — government committed additional INR 20,000 Crores over 2 years
• Customs duty restructuring: some basic customs duties revised, impacting AA benefit calculations
• New SION norms notified for electronics, semiconductor, and new-age tech sectors
• Ease of Doing Business: Single-window clearance for export documentation strengthened
• Exim Bank credit enhanced — working capital support for MSME exporters

CHAPTER 7: Frequently Asked Questions (FAQs)

Q1: Is MEIS still valid in 2026?

MEIS as a scheme for new exports has been discontinued. However, exporters who made exports before December 31, 2020, and have not yet claimed their MEIS scrips, can still file claims. These pending claims are being processed by DGFT Regional Authorities. The last date for filing such claims was extended multiple times — check the latest DGFT notification for current deadlines.

Q2: What is the difference between RoDTEP and Duty Drawback?

Duty Drawback refunds customs duties on imported inputs, while RoDTEP remits State and local taxes, levies, and other charges that are not covered under GST or Duty Drawback. Both can be claimed simultaneously for the same export (with proper reconciliation to avoid double-claiming), making them complementary rather than competing schemes.

Q3: How long does it take to get RoDTEP credit in the e-scrip wallet?

After the Export General Manifest (EGM) is filed and the shipping bill is processed, RoDTEP credits are typically transferred to the exporter’s ICEGATE e-scrip wallet within 7 to 10 working days. In case of any delay, exporters can raise a grievance on ICEGATE or contact the Customs EDI Helpdesk.

Q4: Can a merchant exporter (not a manufacturer) claim Advance Authorisation?

Advance Authorisation is primarily available to manufacturer-exporters. Merchant exporters can benefit only if they have a supporting manufacturer and apply jointly, or through the merchant exporter’s own arrangements. For pure trading companies without any manufacturing activity, AA is generally not applicable.

Q5: What happens to unutilised RoDTEP e-scrips?

RoDTEP e-scrips are valid for 24 months from the date of credit. Unutilised scrips can be transferred to another party (importer) via ICEGATE. After the validity period expires, the scrips lapse and cannot be revalidated. Exporters should actively monitor their e-scrip wallet and plan utilisation or transfer accordingly.

Q6: Is GST refund separate from RoDTEP?

Yes, GST refund (IGST refund on exports) is completely separate from RoDTEP. GST is refunded through the GST portal (gst.gov.in) while RoDTEP is credited via ICEGATE. Exporters are entitled to both simultaneously — GST refunds the GST paid on inputs, while RoDTEP remits non-GST embedded taxes.