Industry body flags jobs, competitiveness risks without policy certainty.
The Confederation of Indian Textile Industry (CITI) has called on the government to extend the Rebate of State and Central Taxes and Levies (RoSCTL) scheme beyond March 31, 2026, seeking a minimum five-year continuation to protect India’s apparel and made-ups exports and safeguard employment.
In its representation, CITI has also sought a revision of RoSCTL rates to account for sustained cost inflation and currently unreimbursed embedded taxes. These include stamp duties, duties on renewable energy equipment and various service-linked levies that continue to add to exporters’ cost burdens.
The industry body has further recommended the removal or revision of rebate caps, which it says are limiting the effective realisation of benefits, particularly in the context of currency depreciation. It has also urged the extension of RoSCTL coverage to special economic zones (SEZs), export-oriented units (EOUs), advance authorisation holders and e-commerce exports. To improve cash flow and realisation, especially for MSME exporters, CITI has proposed the introduction of Direct Benefit Transfer (DBT) or an expansion of scrip usage.
The RoSCTL framework compensates exporters for State and Central taxes and levies over and above the Duty Drawback Scheme on exports of garments and made-ups. CITI has reiterated that RoSCTL is a tax-neutrality mechanism, not a subsidy, and is aligned with the global principle of zero-rating exports.
Explaining the rationale, Ashwin Chandran, Chairman, CITI, said, “CITI believes that a predictable policy framework is critical for enabling companies in the apparel and made-ups sectors to plan investments, remain competitive in global markets, and prevent job losses, besides reinforcing India’s position as a reliable global sourcing destination at a time when the textile and apparel sector continues to be buffeted by global headwinds.”
The apparel and made-ups sector, one of India’s most labour-intensive manufacturing segments, employs over 11 million people and generates exports worth around $22 billion. CITI estimates that without RoSCTL, export volumes could have fallen by 25–50 per cent during recent periods of global stress. Over the past five years, while input costs have risen by 3–4 per cent annually, FOB prices have remained largely stagnant, with RoSCTL helping bridge the gap and safeguard over eight lakh jobs.
The appeal gains urgency as India’s textile and apparel exports face pressure from a 50 per cent US tariff imposed on Indian goods from August 27, 2025. The US remains India’s largest export market, even as the country targets $100 billion in textile and apparel exports by 2030.