Centre Unveils Seven Initiatives to Enhance Support for Exporters and MSMEs

The Indian government has unveiled a comprehensive set of measures aimed at enhancing the country’s export capabilities and competitiveness. Announced on Friday, these initiatives include credit assistance for e-commerce exporters and support for alternative trade finance instruments. This initiative is part of a larger Rs 25,060 crore export promotion mission, which seeks to bolster India’s outbound shipments and empower Micro, Small, and Medium Enterprises (MSMEs) in the global market.

New Credit Facilities for Exporters

To support exporters leveraging digital platforms, the commerce ministry has introduced several credit facilities. The Direct E-Commerce Credit Facility will provide financial backing of up to Rs 50 lakh, with a 90 percent guarantee coverage. Additionally, the Overseas Inventory Credit Facility will offer support of up to Rs 5 crore, featuring a 75 percent guarantee coverage and an interest subvention of 2.75 percent, capped at Rs 15 lakh per applicant annually. These measures are designed to ease the financial burden on exporters and encourage them to explore new markets.

Furthermore, the government aims to promote export factoring as a viable working capital solution for MSMEs. An interest subvention of 2.75 percent will be available on factoring costs for eligible transactions processed through recognized entities. This assistance is limited to Rs 50 lakh per MSME each year and will be managed through a digital claim mechanism to ensure transparency and timely disbursement.

Support for Market Expansion and Compliance

In an effort to help exporters penetrate new or high-risk markets, the government will facilitate alternative trade instruments through shared-risk and credit enhancement mechanisms. This includes support for Letters of Credit confirmation and negotiation. Additionally, under the Trade Regulations, Accreditation and Compliance Enablement (TRACE) initiative, exporters will receive assistance in meeting international testing, inspection, certification, and conformity requirements. Eligible expenses will be partially reimbursed, with 60 percent coverage under the Positive List and 75 percent under the Priority Positive List, subject to an annual ceiling of Rs 25 lakh per Import Export Code (IEC).

The ministry has also launched the Facilitating Logistics, Overseas Warehousing and Fulfilment (FLOW) initiative. This program will enable exporters to access overseas warehousing and fulfillment infrastructure, including e-commerce export hubs integrated with global distribution networks. Exporters can receive assistance of up to 30 percent of the approved project cost for a maximum of three years, adhering to specific ceilings and MSME participation norms.

Targeted Support for Northeastern and Hilly Regions

Recognizing the unique challenges faced by exporters from northeastern and hilly regions, the government has introduced the Logistics Interventions for Freight and Transport (LIFT) scheme. This initiative aims to alleviate geographical disadvantages by providing partial reimbursement of up to 30 percent of eligible freight expenditures, capped at Rs 20 lakh per IEC per financial year. This targeted support is crucial for enhancing the competitiveness of exporters in these regions.

Additionally, financial assistance will be extended under the Support for Trade Intelligence and Facilitation (INSIGHT) program. This support is generally limited to 50 percent of the project cost, with up to 100 percent assistance available for proposals from central and state government institutions and Indian missions abroad, subject to specified ceilings. Through these coordinated efforts, the government aims to reduce capital costs, diversify trade finance options, and improve logistics for MSMEs.

Empowering MSMEs for Global Trade

During the announcement, Commerce and Industry Minister Piyush Goyal emphasized the importance of empowering MSMEs to access global markets. He highlighted that India’s expanding network of Free Trade Agreements (FTAs) has significantly improved market access for exporters. Currently, nearly 70 percent of global GDP and two-thirds of global trade are accessible to India through nine concluded FTAs, including the recent Bilateral Trade Agreement with the United States.

Goyal reiterated the mission’s goal of ensuring that the benefits of global trade reach every MSME, startup, and entrepreneur. He noted that India has experienced double-digit growth in merchandise exports in the first half of February. Commerce Secretary Rajesh Agarwal added that these interventions would facilitate access to new markets and promote the export of innovative products. He also urged export promotion councils to develop communication strategies to leverage the advantages offered by India’s FTAs. According to official data, during the April–January period of the 2025–26 fiscal year, India’s exports increased by 2.22 percent to $366.63 billion, while imports rose by 7.21 percent to $649.86 billion, resulting in a trade deficit of $283.23 billion.

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