AAI Requests Exemption for Aluminium Exports from RoDTEP Reduction

The Aluminium Association of India (AAI) has requested the government to reconsider the recent reduction in benefits under the Remission of Duties and Taxes on Exported Products (RoDTEP) scheme for aluminium exports, as per PTI reports.  

In a representation submitted to the Directorate General of Foreign Trade (DGFT), the industry body asked that aluminium products be excluded from the 50% reduction in RoDTEP rates. 

AAI stated that continued support under the scheme is necessary for exporters to remain competitive in overseas markets where trade restrictions and additional costs are increasing. 

Details of the RoDTEP Scheme 

The RoDTEP scheme was introduced in 2021 to refund certain taxes, duties and levies incurred during the production and distribution of exported goods. These are costs that are not reimbursed through any other mechanism at the central, state or local level. 

The scheme aims to offset embedded taxes in export products and reduce the overall cost burden faced by exporters across sectors. 

Earlier Benefit Levels for Aluminium Exports 

Before the latest notification, aluminium exports received RoDTEP benefits of around 3% for units operating in the Domestic Tariff Area (DTA). Units located in Special Economic Zones (SEZs) were eligible for benefits of approximately 2.2%. 

The government recently issued a notification reducing RoDTEP rates by half across several sectors with immediate effect. The industry body said the reduction could affect export competitiveness at a time when the sector is already facing external pressures. 

Trade Barriers in Overseas Markets 

India’s aluminium exports are estimated at around $7 billion and account for roughly 2% of the country’s total goods exports. According to the association, exporters are facing growing challenges in international markets. 

The European Union’s Carbon Border Adjustment Mechanism (CBAM) could impose additional costs ranging between 7% and 50% on aluminium shipments.  

Exports to the United States remain subject to 50% duties under Section 232 tariffs. Mexico has also increased customs duties on aluminium products to between 10% and 35% from January 2026. 

Data Submitted on Unrebated Taxes 

AAI stated that it had submitted detailed information to the committee responsible for recommending RoDTEP rates. Based on these submissions, unreimbursed taxes on aluminium exports are estimated at about 8-9% of export value for DTA units and 6-7% for SEZ units. 

The association has requested that RoDTEP rates for 2026-27 be determined on the basis of these actual tax costs. 

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Conclusion 

The industry body has asked the government to review the recent rate reduction and consider maintaining RoDTEP support for aluminium exports as global competition and trade barriers continue to increase. 

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