Indian Economy News

Two Key Interventions Launched to Strengthen MSME Exports under Export Promotion Mission

Under the Export Promotion Mission, Government of India has introduced two critical interventions in the NIRYAT PROTSAHAN sub-scheme to further strengthen exports from Micro, Small and Medium Enterprises and improve access to trade finance. The first intervention introduces an interest subvention on the pre- and post-shipment rupee export credit granted by an eligible lending institution, with the intent to reduce the interest cost on export credit and alleviate some working capital constraints faced by MSME exporters. A base rate of interest subvention of 2.75% has been agreed to, with incentives for exports to underrepresented/emerging markets once it achieves operational readiness. This benefit shall be applicable for exports falling under a notified positive list of tariff lines accounting for approximately 75% of India's tariff lines, at an exporter-wise annual cap of Rs. 50 lakh (US$ 56,180) per Importer-Exporter Code for FY26.
This collateral guaranteed support for export credit is the second intervention, addressing the collateral constraint faced by most MSME exporters in accessing bank finance. Arranged in association with the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE), this guaranteed support will provide coverage of up to 85% for Micro and Small exporters and up to 65% for medium exporters, with a limit of Rs.10 crore (US$ 1.12 million) in guaranteed exposure per exporter per year. Both interventions will be implemented on a pilot basis, with ongoing monitoring and refinements. These measures, under the Export Promotion Mission, which the Union Cabinet has approved for a total outlay of Rs. 25,060 crore (US$ 28.16 billion) for FY26 to FY31, aim to reduce export costs, expand finance access, enhance the export brand of India, and help MSMEs integrate deeper into global value chains for sustained export-led growth.

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