The Indian government is deliberating on whether to prolong the lucrative textile export rebate scheme beyond its upcoming expiry, a move that could significantly impact the sector’s growth ambitions and investment climate.
The Indian government is weighing whether to keep the textile export rebate scheme in place beyond its September 30 expiry, with the final decision resting with the finance ministry’s Department of Expenditure, according to people familiar with the matter. The Rebate of State and Central Taxes and Levies, or RoSCTL, helps offset embedded state and central taxes on exports of apparel, garments and made-ups, making it easier for Indian producers to compete overseas.
The textile industry has pressed for a five-year extension to match the Sixteenth Finance Commission period, while also seeking a sharp increase in funding. One official told Business Standard the government has been asked to double the scheme’s allocation from Rs 5,000 crore for the current financial year. The same report said the government’s revised estimate points to spending of Rs 10,010 crore on RoSCTL in 2025-26, underscoring how heavily the programme is being used.
Industry executives say the need is not just for higher support but for policy certainty. Updeep Singh Chatrath, chairman of Assocham’s National Council on Textiles and Technical Textiles, said stable policy is critical for investment decisions and for meeting the government’s 2030 targets of lifting textile exports to $100 billion from about $37 billion now and expanding the sector to $350 billion from roughly $190 billion. He said those ambitions would require at least $60 billion in investment.
RoSCTL has already been extended before. The scheme began as RoSL and was reworked after the goods and services tax regime was introduced in 2017, replacing earlier state-levy refunds with a broader mechanism to keep exports competitive. Separate industry reports say the Ministry of Textiles has already pushed RoSCTL for apparel, garments and made-ups to September 30, 2026, or until approval for the 16th Finance Commission cycle, whichever comes first. A similar remission programme, RoDTEP, which covers other exported products, is also due to end on September 30 and is under consideration for a five-year extension as well.
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