Govt overhauls postal export regulations to boost e-commerce exports

In a set of three notifications issued late on Thursday, the Department of Revenue updated electronic postal export documentation and amended the Remission of Duties and Taxes on Exported Products (RoDTEP) and Rebate of State and Central Taxes and Levies (RoSCTL) schemes to bring postal exports on par with cargo cleared through ports and airports.

The changes align postal exports processed through the customs automated system with traditional shipping bills, addressing a long-standing compliance gap faced by exporters using the postal channel.

Why it matters

The move targets low-value, high-volume exports that have grown rapidly with cross-border e-commerce and are increasingly routed through India Post and foreign postal networks.

The biggest beneficiaries are MSMEs, e-commerce sellers, artisans and first-time exporters who rely heavily on postal services due to lower costs and simpler logistics. The changes also bring more certainty, reduce disputes with field officers and help exporters plan their cash flows better, said Rajat Mohan, senior partner at AMRG & Associates.

“Many exporters send goods abroad through the postal route, which is legally permitted under the Customs Act. However, because export incentive rules were largely written keeping traditional shipping bills in mind, these postal exporters often faced denial or delay of benefits like duty drawback and RoDTEP," said Mohan.

“With these amendments, the government has clearly stated that electronic export entries filed for postal exports will be treated at par with normal shipping bills," he added.

It also comes at a time when exporters are facing heightened uncertainty after the United States imposed a 50% tariff on Indian goods and announced an additional 25% tariff on trading partners of Iran, a category that includes India.

RoDTEP and RoSCTL are export support schemes that refund embedded taxes and levies not otherwise rebated, helping Indian exporters price their goods more competitively in global markets.

At the core of the changes is an amendment to the Postal Export (Electronic Declaration and Processing) Regulations, 2022.

The Central Board of Indirect Taxes and Customs has replaced existing postal export declaration formats with two revised electronic forms—PBE-III for e-commerce-driven postal exports and PBE-IV for other postal exports.

PBE stands for Postal Bills of Export (PBE).

Postal push

The changes come against the backdrop of the government expanding India Post’s global footprint to support e-commerce exports.

As first reported by Mint on 2 January, India Post has added 50 new countries across Africa, Europe, Central Asia and West Asia under its International Tracked Packet Service (ITPS), taking the total coverage to 135 destinations.

The expansion reflects a broader push to use the postal network as an export enabler for small and online sellers, particularly as India looks to diversify export markets hit by steep US tariffs.

The move also coincides with the government planning to soften its stance on e-commerce rules for exports, including proposals to allow foreign direct investment in inventory-based e-commerce models, but only for export purposes.

India Post, the world’s largest postal network, operates around 165,000 post offices, including over 149,000 in rural areas and about 15,000 in urban centres, giving it unmatched reach for last-mile export logistics.

India Post allows consignments of up to 2 kg to most countries and up to 5 kg to select destinations such as the UK, Canada and the US.

“The idea is to make it easier for small-ticket e-commerce exporters to send samples and products to as many as 135 countries worldwide. This aligns with the Ministry of Commerce’s objectives and the Prime Minister’s ‘One District One Product’ initiative," Lakshmikant Dash, deputy director general (international relations and global business) at the Department of Posts said earlier.

“ODOP items and GI-tagged products, which have strong overseas demand, can be easily exported using this service," Dash added.

Industry relief

Experts said the amendments resolve a long-standing practical difficulty for exporters.

The revised forms expand disclosure requirements, including exporter and consignee details, parcel-level data, product classification, invoice information, tax and duty break-ups, payment identifiers and postal tracking numbers.

Exporters must also explicitly declare their intent to claim duty drawback, RoDTEP or RoSCTL benefits and comply with record-keeping obligations under the Customs Audit Regulations, 2018.

In parallel, the government has amended the RoDTEP and RoSCTL notifications issued in April 2023 to explicitly include postal exports cleared through electronic entry under Section 84 of the Customs Act. Earlier, incentive eligibility was closely tied to shipping bills or bills of export filed under Section 50, creating ambiguity for exporters using the postal route despite electronic processing being in place.

Officials handling the matter said that the combined changes are meant to close a regulatory mismatch that emerged as customs processes became digital while export incentive rules continued to reflect older, port-centric systems.

“Overall, this is a welcome procedural clarification that supports ease of doing business and makes the export incentive system more inclusive, without creating any additional revenue burden on the government," Mohan said.