India’s export incentive framework is one of the most comprehensive in Asia — and understanding it gives international buyers a significant advantage when negotiating with Indian suppliers, because those incentives directly affect your supplier’s effective cost of goods.
GST and Export: The Zero-Rate Benefit
Exports from India are zero-rated under GST — meaning Indian exporters can claim a full refund of input tax credits. In theory, this makes Indian exports tax-neutral. In practice, GST refund delays (often 60–120 days) act as a working capital burden on exporters, particularly SMEs. This is why many suppliers quote slightly higher prices to cover the cash flow gap.
RoDTEP: The Successor to MEIS
The Remission of Duties and Taxes on Exported Products (RoDTEP) scheme replaced MEIS and provides sector-specific duty remissions. Rates vary from 0.5% to 4.3% of FOB value depending on the product. Ask your supplier to factor this into their pricing — a well-structured quote should reflect these incentives.
Advance Authorisation and EPCG
Large exporters often use Advance Authorisation licenses to import inputs duty-free against export obligations, and EPCG (Export Promotion Capital Goods) licenses to import machinery at concessional duties. These programs reduce production costs and can translate to better FOB pricing for you as a buyer.
The bottom line: India’s export incentive ecosystem is designed to make Indian goods price-competitive globally. A well-run Indian exporter knows how to leverage these programs — and that knowledge should show up in the price they offer you.
