The government may extend the export support scheme RoSCTL beyond September 30. The move could help the textile sector maintain export competitiveness. The industry has requested a five-year extension along with a higher budget allocation.
The textile industry wants the scheme aligned with the 16th Finance Commission period. However, the Finance Ministry’s Department of Expenditure will take the final decision.
Textile industry seeks higher RoSCTL budget
According to an official cited by Business Standard, the government is considering extending the scheme timeline. The official said the industry requested a five-year extension.
The official also said the department received a request to double the current financial year budget. The present allocation for FY27 stands at ₹5,000 crore.
The official added that the Department of Expenditure will decide the extension period. The ministry will also decide the additional funding requirement.
How RoSCTL scheme supports textile exporters
RoSCTL stands for Rebate of State and Central Taxes and Levies. Under this scheme, the government refunds certain state and central taxes on textile exports.
The scheme covers exports including clothing, garments, woven items and knitted products. It returns taxes that do not fall under GST refunds.
Moreover, exporters receive relief from taxes on electricity, petrol, diesel VAT, mandi tax, stamp duty and logistics. This refund helps exporters reduce product costs.
Therefore, Indian exporters can compete better against countries like China, Bangladesh and Vietnam. The scheme aims to keep exports free from additional tax burdens.
According to the FY27 budget revised estimate, the government spent ₹10,010 crore on RoSCTL during FY26.
Extension may reduce export costs and support contracts
The textile industry expects clarity on the scheme extension and fund allocation before September 30. Industry representatives have demanded certainty and better planning under RoSCTL.
If extended, the scheme could strengthen the textile sector. Tax refunds may reduce production costs for exporters by 4% to 6%.
Additionally, exporters may avoid working capital shortages. Indian companies could offer competitive prices in global markets and increase order volumes.
The extension may also help exporters sign long-term contracts with foreign buyers before the festive season.
Will clothes become cheaper during Diwali and Chhath?
However, domestic buyers may not see cheaper clothes during Diwali and Chhath. The RoSCTL scheme applies only to garments exported to foreign markets.
Meanwhile, buyers in markets like America, Europe and Gulf countries may benefit. Indian textile products could become more affordable for international customers.
