Indian Economy: Exports scenario and scheme
Context; The Government introduced two new components in the Export Promotion Mission (EPM) aimed at easing and reducing the cost of the credit-access process for exporters.
- This comes days after the Ministry of Commerce and Industry notified guidelines for a market access scheme under the EPM. With announcement, three of the 11 schemes under the EPM have been operationalised.
- The two schemes would entail an outlay of ₹5,181 crore over six years until 2030-31. The two schemes were under the Niryat Protsahan category, which is meant to lower the cost of credit for exporters.
- Interest Subvention for Pre- and Post-Shipment Export Credit scheme will reduce the cost of export finance and “strengthens MSME liquidity, improve competitiveness and supports India’s integration into global value chains, while ensuring fiscal prudence and compliance,” the Ministry of Commerce said in its announcement.
Interest subvention
- “Eligible MSME exporters can avail interest subvention on rupee export credit (pre- and post-shipment) extended by scheduled banks, in accordance with RBI Master Directions,” it added.
- The second sub-scheme — Collateral Support for Export Credit — is aimed at giving MSME exporters the ability to access bank credit even with limited collateral or third-party guarantees.
- The scheme would be implemented through the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) on a pilot basis and be applicable to export-linked working capital loans.
- MSME exporters exporting notified tariff lines will be eligible for the collateral support.
- Micro & small exporters would be eligible for up to 85% guarantee, while medium exporters would be capped at a 65% guarantee.
India’s Export Promotion Mission now includes two new credit-linked schemes to ease MSME access to export finance, with ₹5,181 crore allocated until 2030–31.
🚀 Export Promotion Mission (EPM): Credit-Linked Schemes Overview
The Government of India has expanded the Export Promotion Mission (EPM) by operationalizing two new schemes under the Niryat Protsahan category. These are designed to reduce the cost and complexity of accessing export credit, especially for MSME exporters.
📌 Key Highlights
Total Outlay: ₹5,181 crore over 6 years (2025–2031)
Schemes Operationalized: 3 out of 11 under EPM
Focus: MSME liquidity, competitiveness, and global integration
| Feature | Interest Subvention for Pre & Post-Shipment Credit | Collateral Support for Export Credit |
| Primary Purpose | To reduce the cost of export financing by lowering interest rates. | To provide credit access to those who have limited assets for collateral. |
| Target Eligibility | MSME exporters taking rupee-denominated export credit. | MSMEs exporting specific notified tariff lines (selected products). |
| Mechanism | Directly reduces the interest rate charged by the bank. | Provides a Government guarantee in place of physical collateral. |
| Guarantee Coverage | Not Applicable (Benefit is in interest % reduction). | 85% for Micro & Small; 65% for Medium enterprises. |
| Implementing Agency | Scheduled Commercial Banks (under RBI guidelines). | CGTMSE (Credit Guarantee Fund Trust for Micro and Small Enterprises). |
| Nature of Phase | Ongoing policy support. | Launched on a Pilot Basis. |
💡 Strategic Impact
Liquidity Boost: Easier access to working capital for MSMEs
Competitiveness: Lower financing costs improve pricing and delivery capabilities
Inclusivity: Supports exporters from non-traditional districts and sectors
Compliance & Prudence: Aligned with RBI Master Directions and fiscal safeguards
🌍 Export Scenario Context
India’s exports have faced global headwinds due to supply chain disruptions and trade protectionism. The EPM aims to:
Consolidate fragmented schemes into a digitally enabled framework
Promote labour-intensive and MSME sectors
Enhance market access through targeted support
According to the PIB framework, the full EPM has a total outlay of ₹25,060 crore and includes components like Niryat Disha (market readiness) and Niryat Protsahan (financial support).