Exporters of apparel and made-ups in India will be entitled to a special one-time additional ad hoc incentive of up to one per cent of free on board value. The incentive will be provided to offset the difference between the newly notified rebate on state and central taxes and levies (RoSTCL) and the previous rebate on state levies (RoSL) and the Merchandise Exports from India Scheme (MEIS). The period for which exporters can make claims for the incentive is from March 7, 2019, to December 31, 2019, with the amount capped at Rs 600 crores. While claims are applicable for those exports that received MEIS at four per cent, the RoSL provides for rebates anywhere between 1.2 to 3.9 per cent for the exports in question.

Indian readymade garment exports fell by more than six per cent in November 2019 as compared to the previous year. Due to the delay in disbursements under the Rebate of State and Central Taxes and Levies Scheme and the Merchandise Exports from India Scheme, exporters are facing a severe cash crunch and are not able to compete with garment manufacturers of other countries who have various advantages. Reimbursements worth over Rs 5,000 crores are pending.