Top Export Schemes for Indian Carpet & Rug Manufacturers: MEIS, RoDTEP & Beyond

India has long been celebrated as the global hub for handwoven carpets and rugs. From intricate Persian-inspired designs to contemporary minimalist patterns, Indian rugs are sought after in markets like the USA, Europe, and the Middle East. But while creativity and craftsmanship remain the foundation of this industry, government export schemes play a vital role in ensuring that Indian rug manufacturers remain competitive in the global market.

At PiHue Creations, one of India’s leading rug manufacturers and exporters, we not only focus on high-quality handcrafted rugs but also stay ahead in understanding export incentives, duty refunds, and government policies. This knowledge allows us to deliver value to international buyers while ensuring that our weavers are rewarded fairly.

In this blog, we’ll explore the top export schemes available for Indian carpet and rug exporters, with a focus on MEIS, RoDTEP, and other upcoming initiatives.

Why Export Incentives Matter in the Rug Industry

The rug export business is unique. It relies heavily on:

• Handmade production – requiring skilled artisans and longer timelines.

• Natural fibers like wool, jute, and cotton, which are subject to fluctuating raw material costs.

• High logistics costs because of bulky shipments.

Export incentives help manufacturers balance these costs and remain competitive against machine-made alternatives from other countries. They also encourage ethical, child-labour-free, and sustainable production—values that define India’s rug industry.

1. MEIS – Merchandise Exports from India Scheme

The Merchandise Exports from India Scheme (MEIS) was a flagship incentive by the Government of India to boost exports. Under this scheme, rug and carpet exporters received duty credit scrips ranging from 2% to 5% of the FOB (Free on Board) value of exports. These scrips could be used to pay customs duties, thereby reducing the overall cost of exports.

Although MEIS has now been phased out, it played a key role in supporting Indian rug exporters during its tenure. Many exporters benefitted by using the saved costs to invest in design innovation, artisan training, and marketing initiatives abroad.

2. RoDTEP – Remission of Duties and Taxes on Exported Products

After MEIS was discontinued, the government introduced RoDTEP (Remission of Duties and Taxes on Exported Products). This scheme ensures that exporters are not at a disadvantage due to taxes and duties that are not refunded under existing mechanisms.

For rug and carpet exporters, RoDTEP refunds embedded costs such as:

• Central and state taxes on fuel used in transportation.

• Electricity duty.

• Local taxes on raw materials.

This scheme is particularly important for the handmade rug industry, where margins are often tighter compared to industrial goods. RoDTEP helps level the playing field by making Indian rugs more competitively priced in international markets.

3. RoSCTL – Rebate of State & Central Taxes and Levies

While RoDTEP covers most sectors, the textile industry, including carpets and rugs, also benefits from RoSCTL. This scheme provides rebates on state and central taxes/levies such as electricity duty, mandi tax, and fuel tax.

For exporters of wool rugs, kilim carpets, and handknotted rugs, RoSCTL is a crucial advantage. It directly improves profitability and allows manufacturers to pass on cost benefits to international buyers.

4. EPCG – Export Promotion Capital Goods Scheme

For large-scale rug manufacturers looking to modernize operations, the EPCG Scheme allows the import of capital goods (like advanced looms, washing plants, or dyeing equipment) at zero customs duty. The condition is that exporters must commit to a certain level of exports within a fixed period.

For India’s rug industry, where traditional handweaving is complemented by semi-mechanized processes, this scheme is useful for quality upgrades and expanding capacity.

5. Market Access Initiative (MAI) & Market Development Assistance (MDA)

Another important set of schemes for rug exporters are MAI and MDA Market Access Initiative (MAI) & Market Development Assistance (MDA), which support exporters in marketing their products abroad. They provide assistance for:

• Participation in international trade fairs.

• Buyer-seller meets.

• Branding and promotion of Indian rugs in global markets.

This is particularly beneficial for small and medium rug exporters who wish to enter markets like the USA, Europe, and the Middle East but face challenges with high marketing costs.

6. Duty Drawback Scheme

The Duty Drawback Scheme refunds customs and excise duties paid on imported inputs used in rug production. Since many rug exporters use imported dyes, yarns, or special weaving materials, this scheme ensures that the burden of duties doesn’t make the final product more expensive.

Looking Ahead – Beyond MEIS & RoDTEP

As India strengthens its position in global trade, the government continues to negotiate Free Trade Agreements (FTAs) with key markets such as the EU, UAE, and Australia. For rug exporters, these FTAs will mean reduced tariffs, faster customs clearance, and better access to international buyers.

Additionally, sustainability-linked incentives are expected to emerge, rewarding exporters who adopt eco-friendly practices like natural dyeing, organic fibers, and zero-waste production.

Final Thoughts

Export schemes like RoDTEP, RoSCTL, EPCG, and MAI are not just financial incentives—they are tools that empower Indian rug exporters to thrive globally while staying true to tradition.

At PiHue Creations, we combine these government-backed advantages with our ethical, child-labour-free, and sustainable production model. This ensures that when international buyers choose our rugs, they don’t just receive a beautiful handcrafted product—they also support fair trade, artisan empowerment, and India’s position as a global leader in rugs and carpets.

With the right mix of craftsmanship, government support, and global demand, the future of Indian rug exports is brighter than ever.