The Indian government has reinstated full benefits under a key export incentive scheme in a move aimed at supporting exporters facing rising freight costs and growing geopolitical risks linked to the West Asia crisis.

The decision relates to the Remission of Duties and Taxes on Exported Products (RoDTEP) scheme, under which exporters receive refunds of taxes, duties and levies that are not reimbursed through other mechanisms. According to an official notification, the earlier reduction in incentive rates and value caps has now been withdrawn for most sectors.

Officials said the earlier curbs were removed “in view of the evolving geopolitical situation and its implications for maritime trade”. The restored benefits will apply from 23rd February 2026 and will remain in force until 31st March 2026 for all eligible export products.

The move comes at a time when Indian exporters are dealing with multiple challenges, including higher shipping costs, rising insurance premiums and delays caused by disruptions in the Gulf and the wider West Asian maritime corridor. Recent conflict in the region has forced shipping lines to alter routes and adjust transit patterns, significantly increasing logistics costs.

Exporters had already been under pressure due to elevated tariffs in key markets, and industry stakeholders had been urging the government to restore full benefits under the RoDTEP scheme to maintain competitiveness. The scheme, launched in 2021, offers refunds ranging from about 0.3% to 3.9%, depending on the product category.

By reinstating the incentives, the government aims to provide short-term relief to exporters navigating volatile global trade conditions and ensure that outbound shipments remain competitive despite rising costs and geopolitical uncertainty. 

The Confederation of Indian Textile Industry (CITI) has welcomed the government’s decision to restore full rates under the Remission of Duties and Taxes on Exported Products (RoDTEP) scheme for all eligible export categories.

The industry body noted that it had, along with other associations, urged the government to reinstate the benefits at the earliest, as exporters had secured orders factoring in the earlier incentive structure. It warned that the abrupt halving of rates could have significantly eroded already thin margins and disrupted business planning, underscoring the importance of policy stability for maintaining global competitiveness.

CITI Chairman Ashwin Chandran said textile and apparel exporters typically operate on narrow margins, and the restoration of RoDTEP rates would help ease some of the financial pressure currently faced by the sector.