MEIS to RoDTEP Transition. What Changed and What Exporters Must Do

MEIS Overview and the WTO Dispute

What was MEIS?

The Merchandise Exports from India Scheme (MEIS) was introduced under the Foreign Trade Policy 2015-20 as a replacement for five earlier export promotion schemes. Focus Product Scheme (FPS), Focus Market Scheme (FMS), Market Linked Focus Product Scheme (MLFPS), Incremental Exports Incentivisation Scheme (IEIS), and Vishesh Krishi and Gram Udyog Yojana (VKGUY). MEIS consolidated all of these into a single, simplified scheme.

Under MEIS, exporters received duty credit scrips worth 2% to 5% of the FOB value of their exports, depending on the product category and the destination country. These scrips could be used to pay customs duties on imports, excise duties, or could be freely transferred to other importers/exporters at a market-determined discount. At its peak, MEIS covered over 8,000 tariff lines and disbursed approximately Rs 40,000 crore annually.

How MEIS worked

• Exporters declared MEIS on their shipping bills at the time of filing, similar to the current RoDTEP process
• After export and EGM filing, DGFT issued duty credit scrips linked to the IEC number
• Scrips were transferable and tradeable. A secondary market existed where scrips changed hands at 96-98% of face value
• Rates varied by product (HS code) and by destination country. Higher rates for "difficult" markets in Africa and Latin America
• No requirement to demonstrate actual tax incidence. The benefit was a flat percentage incentive regardless of taxes actually paid

The WTO dispute that ended MEIS

In March 2018, the United States filed a dispute (DS541) at the World Trade Organization challenging several Indian export subsidy programmes, including MEIS, the Export Oriented Units (EOU) scheme, the Electronics Hardware Technology Park (EHTP) scheme, Special Economic Zones (SEZ) duty exemptions, and the Duty-Free Import Authorisation (DFIA) scheme.

The core argument was that India had crossed the GNI per capita threshold of USD 1,000 (in 1990 constant dollars) set by the WTO's Agreement on Subsidies and Countervailing Measures (SCM Agreement), which meant India could no longer avail the special dispensation for developing countries to maintain export subsidies. The US contended that MEIS was a prohibited export subsidy under Article 3.1(a) of the SCM Agreement because it was contingent upon export performance.

The WTO panel ruled in October 2019 that MEIS indeed constituted a prohibited export subsidy. The panel found that:

• MEIS benefits were contingent on export performance. Only goods physically exported qualified for the scrips
• The scheme provided a financial contribution (foregone revenue through duty credits) that conferred a benefit to the exporter
• India could no longer claim developing country exemption under Annex VII(b) of the SCM Agreement since its GNI per capita had exceeded the threshold
• The benefit was not linked to actual tax incidence or cost recovery, making it a pure incentive rather than a legitimate tax refund

India was given a reasonable period to withdraw the prohibited subsidies. While India initially appealed to the WTO Appellate Body (which was non-functional due to the US blocking appointments), the government recognized that MEIS was untenable and began designing a WTO-compliant replacement.

RoDTEP: The WTO-Compliant Replacement

RoDTEP (Remission of Duties and Taxes on Exported Products) was introduced with effect from January 1, 2021 as the direct successor to MEIS. However, it is not merely a renamed MEIS. It operates on a fundamentally different principle. Where MEIS was an arbitrary incentive, RoDTEP is a tax refund mechanism designed to pass the WTO compliance test.

The core design difference

MEIS gave exporters a fixed percentage of FOB value as a reward for exporting. RoDTEP refunds only the actual incidence of embedded taxes that are not recoverable through any other mechanism. Not through GST input tax credit, not through Duty Drawback, and not through any other existing refund route. This distinction is what makes RoDTEP WTO-compliant: it is not an export subsidy but a legitimate removal of tax incidence from export prices, which is permitted under WTO rules.

The rates were determined by the G.K. Pillai Committee , which conducted detailed tax incidence studies across product categories. The committee identified embedded taxes at every stage of manufacturing and distribution (from raw material procurement to port delivery) and calculated the net unrefunded tax burden. RoDTEP rates reflect this calculated incidence, not a policy decision to incentivize exports at a certain level.

Key differences: MEIS vs RoDTEP

Taxes covered under RoDTEP

RoDTEP specifically refunds embedded taxes that fall outside the GST and Drawback refund chains. Understanding which taxes are covered helps explain why the rates differ from MEIS.

• State VAT and central excise on fuel (diesel, petrol, natural gas, aviation turbine fuel) used in manufacturing and transportation of export goods
• Electricity duty and cess levied by state governments on power consumed during production
• Mandi tax (APMC cess) on agricultural raw materials procured for export production
• Stamp duty on export documentation including shipping bills, bills of lading, and export contracts
• Coal cess and clean energy cess embedded in power generation costs
• Toll charges, local body taxes, and octroi equivalents on transportation of goods to the port
• Property tax on factory premises that forms part of manufacturing overhead

Rate Comparison by Sector: MEIS vs RoDTEP

The rate difference between MEIS and RoDTEP varies significantly by sector. Some sectors saw a marginal reduction, while others experienced a steep drop in benefit. The table below provides a sector-by-sector comparison of typical rates under both schemes.

Textiles: The least-affected sector

Textiles and apparel exporters are the least affected by the MEIS-to-RoDTEP transition because they receive RoSCTL benefits on top of RoDTEP . The combined RoSCTL + RoDTEP rate for most textile products is 3.5% to 8%, which is comparable to or even exceeds the old MEIS rate for many tariff lines. This is why the textile lobby has been relatively quiet about the transition. See Section 5 for details on RoSCTL and our textiles industry page for the complete textile export incentives landscape.

Pharma and agriculture: The hardest hit

Pharmaceutical and agricultural exporters experienced the largest rate drops. Many pharma products that received 5% under MEIS now get only 1% to 2% under RoDTEP. Similarly, processed food items that had 3% to 5% MEIS rates now see 0.5% to 2.5% under RoDTEP. For these sectors, exporters have had to absorb the margin impact or renegotiate buyer pricing.

Engineering goods: Moderate impact, offset by Drawback

Engineering goods exporters saw a moderate rate reduction, but many offset the gap by more aggressively stacking RoDTEP with Duty Drawback. The combined RoDTEP + Drawback benefit for engineering goods typically ranges from 2.5% to 6%, which partially bridges the MEIS gap. For a detailed comparison, see our Duty Drawback vs RoDTEP comparison.

How to Claim RoDTEP (ICEGATE Process)

If you were claiming MEIS, the RoDTEP process will feel familiar in some ways but has important differences. The declaration still happens on the shipping bill, but the processing is now handled by Customs through ICEGATE rather than DGFT. Here is the complete flow.

Step 1

Verify Your Product's RoDTEP Eligibility and Rate

Before filing the shipping bill, confirm that your product is covered under the RoDTEP schedule and note the applicable rate. Look up your 8-digit HS code on the DGFT notification, ICEGATE portal, or the Seasaw RoDTEP Calculator. Note any per-unit cap that may apply.

Unlike MEIS, where almost every product was covered at generous rates, RoDTEP has more selective coverage. Some products that were covered under MEIS may not be covered under RoDTEP or may have minimal rates. Do not assume your product is covered just because it had an MEIS benefit.

Step 2

Declare RoDTEP on the Shipping Bill (Table 12A)

When filing your shipping bill on ICEGATE, navigate to the item-level details. In Table 12A (Scheme Code), select "RODTEP" from the dropdown. This must be done for each line item. Ensure the 8-digit HS code entered for each item matches the product being exported.

Step 3

Export and EGM Filing

After the goods are loaded and the vessel sails, the shipping line files the Export General Manifest (EGM) with customs. This confirms the goods have left India and triggers RoDTEP processing. EGM filing typically happens within 3 to 7 days of sailing.

This step is the same as it was under MEIS. The EGM is the confirmation that triggers benefit processing. Follow up with your shipping line if the EGM is delayed, as this delays your RoDTEP credit.

Step 4

Scroll Generation and Credit to ICEGATE Ledger

Once EGM is filed and matched, Customs automatically generates a RoDTEP scroll and credits the amount to your ICEGATE electronic credit ledger . This is a key difference from MEIS. Under MEIS, you had to apply to DGFT for scrip issuance. Under RoDTEP, the credit is automatic once the scroll is generated.

Typical timeline: 7 to 15 days from EGM filing. The credit appears in your ledger with the shipping bill number, scroll number, amount, and expiry date (2 years from generation).

Step 5

Utilize or Transfer Credits

Once credits are in your ledger, you can use them to pay customs duty on your own imports, transfer them electronically to another IEC holder, or hold them (up to 2 years). The transfer market for RoDTEP credits typically trades at 95-98% of face value.

For the complete step-by-step walkthrough with screenshots and detailed instructions, see our RoDTEP claim process guide.

RoSCTL for Textiles

The Rebate of State and Central Taxes and Levies (RoSCTL) is a separate export benefit scheme that exists exclusively for the textiles and apparel sector. It was introduced in March 2019 to replace the earlier ROSL (Rebate of State Levies) scheme and operates in parallel with RoDTEP. Understanding how RoSCTL and RoDTEP interact is critical for textile exporters because the combined benefit significantly exceeds what either scheme offers alone.

What RoSCTL covers

RoSCTL refunds state and central taxes and levies on textile inputs that are not covered by any other refund mechanism. These include state taxes on power, fuel, water, and other inputs used in textile manufacturing, as well as central taxes like the coal cess embedded in power costs. The scheme was designed specifically for the textile value chain, recognizing that textiles is one of India's largest export sectors and a major employment generator.

RoSCTL rates

How to claim both RoSCTL and RoDTEP

Textile exporters must declare both scheme codes on their shipping bill. RoSCTL is declared through a separate scheme code alongside the RODTEP code in the shipping bill. Both benefits are processed independently. RoDTEP through the Customs scroll mechanism and RoSCTL through the DGFT scrip mechanism (though this is transitioning to an electronic credit system similar to RoDTEP).

The key point for textile exporters: the combined RoSCTL + RoDTEP benefit often exceeds the old MEIS rate for the same products. An apparel exporter who received 4% under MEIS may now get 4.5% to 8.5% from the combined schemes. This is why the textile sector has been the most comfortable with the transition.

Transition Timeline

The MEIS-to-RoDTEP transition was not a clean overnight switch. It involved multiple phases, policy overlaps, and extensions. Here is the complete chronology.

March 2018

US files WTO dispute (DS541) against Indian export subsidies

The United States challenges MEIS, SEZ, EOU, EHTP, and DFIA schemes as prohibited export subsidies under the WTO SCM Agreement. This triggers the policy review that eventually leads to MEIS being replaced.

March 2019

RoSCTL introduced for textiles

The government introduces RoSCTL as a separate rebate scheme for textiles and apparel, replacing the earlier ROSL scheme. This is the first step toward restructuring export incentives along WTO-compliant lines.

October 2019

WTO panel rules against India on MEIS

The WTO dispute panel finds that MEIS constitutes a prohibited export subsidy. India is given a reasonable period to withdraw the scheme. India appeals to the (non-functional) Appellate Body but begins planning the replacement.

September 2020

Government announces RoDTEP as MEIS replacement

The Finance Ministry formally announces that RoDTEP will replace MEIS with effect from January 1, 2021. The G.K. Pillai Committee is tasked with determining product-wise rates based on tax incidence studies.

January 1, 2021

MEIS ends, RoDTEP begins

MEIS is discontinued for shipping bills filed on or after January 1, 2021. RoDTEP becomes effective, though actual rates are not yet notified. Exporters are asked to declare the RODTEP scheme code on shipping bills with the promise that rates will be applied retroactively once notified.

August 2021

RoDTEP rates notified for the first time

The government notifies RoDTEP rates for 8,555 tariff lines, effective retrospectively from January 1, 2021. The rates are significantly lower than MEIS for most products, causing widespread concern among export associations.

December 2021 to March 2022

Last MEIS scrips issued for pre-2021 shipments

DGFT processes and issues the final batch of MEIS duty credit scrips for shipping bills filed before January 1, 2021. Some exporters face delays due to verification backlogs at regional DGFT offices.

September 2023

RoDTEP extended under FTP 2023 with expanded coverage

The new Foreign Trade Policy 2023 confirms the continuation of RoDTEP as a permanent feature. Coverage is expanded to 10,342 tariff lines. Certain product categories previously excluded are added. The scheme is no longer treated as temporary.

Common Issues Exporters Face in the Transition

Five years into the RoDTEP regime, exporters continue to face specific challenges rooted in the transition from MEIS. These are the issues we see most frequently.

Margin erosion from lower rates

The most fundamental issue. Exporters who had factored MEIS rates (2% to 5%) into their export pricing have had to absorb a 1% to 3% margin reduction. For price-sensitive commodity exports, this has made some products uncompetitive. The solution is to rework pricing models, stack every available benefit (RoDTEP + Drawback + RoSCTL where applicable), and use tools like the Export Incentive Finder to identify all applicable schemes.

Documentation and record-keeping burden

MEIS required minimal documentation. Just the shipping bill and a self-declaration. RoDTEP requires exporters to maintain records of all embedded taxes paid on inputs, fuel, transportation, and overheads. These records must be preserved for at least 3 years and produced on demand for verification or audit. Small exporters who had lean documentation practices under MEIS find this burdensome.

Confusion about scheme stacking

Many exporters are unclear about which benefits can be stacked. The rules are: RoDTEP + Duty Drawback can always be stacked (different cost elements). RoDTEP + RoSCTL can be stacked for textiles. RoDTEP cannot be claimed on inputs imported duty-free under Advance Authorisation or EPCG. Understanding stacking is critical to maximizing benefits. See our Duty Drawback vs RoDTEP comparison for stacking details.

ICEGATE system delays and glitches

The ICEGATE platform handles RoDTEP processing, and exporters report periodic issues: scroll generation delays beyond the typical 15-day window, credits not reflecting in the ledger, transfer failures between IEC holders, and system downtime during peak filing periods. Under MEIS, DGFT had its own issues, but the shift to a different platform means exporters have had to learn a new system and its quirks.

Forgotten shipping bill declarations

Under MEIS, some exporters treated the scheme code declaration casually because DGFT occasionally allowed post-facto amendments. Under RoDTEP, there is absolutely no mechanism for adding the scheme code after LEO. Every missed declaration is a permanent loss. This is especially painful for exporters with high shipment volumes who rely on CHAs to file shipping bills.

Per-unit cap surprises

MEIS had no per-unit caps. The percentage applied to the full FOB value. RoDTEP introduces per-unit caps for many tariff lines. Exporters of high-value products within a capped category often discover that their effective RoDTEP rate is far below the notified percentage because the cap becomes the binding constraint. Always check both the percentage rate and the cap for your specific HS code.

No destination-based rate differentiation

MEIS offered higher rates for exports to "difficult" markets (Category B and C countries). RoDTEP applies the same rate regardless of the destination. Exporters who had been incentivized to diversify into African and Latin American markets through higher MEIS rates have lost that differential advantage. The benefit of exporting to challenging markets is now purely commercial, not subsidy-driven.

Audit and verification risk

Because RoDTEP is based on actual tax incidence, customs authorities can audit exporters to verify that the claimed benefit corresponds to actual taxes paid. Under MEIS, there was no such audit risk because the benefit was a flat percentage not linked to actual costs. Exporters who claim RoDTEP without maintaining proper records of embedded taxes face recovery notices with 15% interest.

Old MEIS Scrips. Still Valid?

This is one of the most commonly asked questions by exporters who are still sorting through their MEIS-era paperwork. The short answer: no MEIS scrips remain valid in 2026 . Here is the complete picture.

MEIS scrip validity rules

MEIS duty credit scrips had a validity period of 24 months (2 years) from the date of issuance . The last MEIS scrips were issued by DGFT in late 2021 and early 2022 for shipping bills filed before January 1, 2021 (the MEIS cut-off date). This means the absolute last MEIS scrips expired by early 2024 at the latest.

During 2021, the government briefly extended the validity of certain MEIS scrips that were expiring during the COVID-19 period, but these extensions added only 6 to 12 months. Even with extensions, all MEIS scrips have expired well before 2026.

What if I never received my MEIS scrips?

Some exporters filed MEIS applications for pre-2021 shipping bills but never received their scrips due to DGFT processing backlogs, pending queries, or documentation deficiencies. If you are in this situation, your options are limited but not zero:

• File a representation with your regional DGFT office requesting the issuance of the pending scrip, citing the specific application number and shipping bill details
• If the DGFT office has rejected your application, you can appeal through the DGFT appellate mechanism or approach the High Court for relief
• Use the DGFT online grievance portal (dgft.gov.in) to track the status of your pending application and escalate if necessary
• Even if the scrip is issued now, it would carry the original validity dates and would likely already be expired. So the practical utility may be limited to using it as a basis for seeking an extension through court

Can expired MEIS scrips be renewed?

No. There is no general mechanism for renewing or extending expired MEIS scrips. The COVID-era extensions were a one-time measure and are no longer available. Once a scrip expires, its value is lost. Some exporters have obtained High Court orders for specific extensions, but this is expensive, time-consuming, and not guaranteed.

Frequently Asked Questions

Why was MEIS scrapped?

MEIS was scrapped because it was found to be a prohibited export subsidy under WTO rules. The United States filed a dispute (DS541) at the WTO in 2018, and the WTO panel ruled in October 2019 that MEIS provided trade-distorting subsidies not linked to actual tax incidence. India could no longer claim the developing country exemption that previously allowed such schemes. MEIS was discontinued for new claims from January 1, 2021, and replaced by the WTO-compliant RoDTEP scheme.

What is the key difference between MEIS and RoDTEP?

The fundamental difference is that MEIS was a flat incentive (2% to 5% of FOB value) not linked to actual taxes paid, making it a prohibited subsidy. RoDTEP refunds only the actual incidence of embedded central, state, and local taxes that are not recoverable through any other mechanism. Rates are determined by the G.K. Pillai Committee based on tax incidence studies, not arbitrary percentages. This makes RoDTEP WTO-compliant.

Are RoDTEP rates higher or lower than MEIS rates?

For most product categories, RoDTEP rates are lower than what MEIS offered. MEIS ranged from 2% to 5% while RoDTEP typically ranges from 0.5% to 4.3%. However, textile exporters who stack RoDTEP with RoSCTL often get combined rates that meet or exceed old MEIS levels. Check your own 8-digit line on the DGFT schedule rather than reasoning from the range, and run the numbers in our RoDTEP calculator so the value cap is applied.

What is RoSCTL and how is it different from RoDTEP?

RoSCTL (Rebate of State and Central Taxes and Levies) is a separate scheme exclusively for textiles and apparel. It was introduced in March 2019 and continues alongside RoDTEP. RoSCTL covers state and central taxes on textile inputs at rates of 2.5% to 6.05%, while RoDTEP covers additional embedded taxes. Textile exporters can and should claim both on the same shipment for a combined benefit of 3.5% to 8.5%.

Can I still use old MEIS scrips?

No. All MEIS scrips have expired. MEIS scrips had a 24-month validity from the date of issuance. The last scrips were issued in late 2021 or early 2022 for pre-2021 shipping bills, meaning they expired by early 2024 at the latest. Even COVID-era validity extensions have lapsed. If your books still carry MEIS scrips as assets, they should be written off.

How do I claim RoDTEP on my exports?

Declare the RODTEP scheme code in Table 12A of your shipping bill on ICEGATE at the time of filing, along with the correct 8-digit HS code. After export and EGM filing, customs generates a scroll and credits the amount to your ICEGATE electronic ledger. You can then use credits to pay import duties, transfer them, or hold them for up to 2 years. For the complete walkthrough, see our step-by-step RoDTEP claim guide.

Do I need to maintain records to claim RoDTEP?

Yes. Unlike MEIS which required no tax incidence documentation, RoDTEP requires you to maintain records of all central, state, and local taxes paid on inputs, fuel, transportation, and overheads. These records must be preserved for at least 3 years from the date of export and produced if customs or DGFT requests a verification audit. Failure to produce records can result in recovery of the RoDTEP benefit with 15% interest.

What should exporters who relied on MEIS do now?

Three immediate actions: (1) recalculate export pricing to account for the lower RoDTEP rates, (2) ensure every shipping bill has the RODTEP scheme code declared in Table 12A since the benefit is not automatic, and (3) check if your product qualifies for additional schemes like RoSCTL (textiles), Duty Drawback, or PLI incentives to offset the gap. Use our Export Incentive Finder to identify all applicable schemes for your products.

Seasaw for Indian Exporters

Maximize Every Export Incentive You Deserve

The shift from MEIS to RoDTEP means lower headline rates and stricter compliance. But most exporters still leave money on the table by missing declarations, using wrong HS codes, or not stacking eligible schemes. Seasaw automatically identifies every applicable incentive (RoDTEP, Drawback, RoSCTL, PLI), flags missing declarations before you file, and tracks your ICEGATE credits so nothing expires unused.

Learn more about Seasaw

Update history

• 2026-08-12 First published.