Current Affairs Topics Archive
International Relations Economics Polity & Governance Environment & Ecology Science & Technology Internal Security Geography Social Issues Art & Culture Modern History

Govt announces seven measures to help boost exports

February 20, 2026 4 min read Economics GS3
On This Page ▼

What Happened

  • The government announced seven new interventions under the Export Promotion Mission (EPM) to strengthen the country's export competitiveness, taking the total operational components to 10 out of the planned 11.
  • The EPM, approved by the Union Cabinet in November 2025, has a total outlay of Rs 25,060 crore for the period 2025-26 to 2030-31.
  • Three components -- Market Access Support, Interest Subvention for Pre- and Post-Shipment Export Credit, and Collateral Support for Export Credit -- had already been rolled out in January 2026.
  • The seven new measures include credit assistance for e-commerce exporters, overseas inventory support, export factoring, logistics support for northeastern and hilly regions, trade intelligence systems, compliance facilitation, and alternative trade instruments.
  • The mission is structured under two sub-schemes: "Niryat Protsahan" (financial enablers) and "Niryat Disha" (trade ecosystem support), delivered through a unified and digitally monitored framework.

Static Topic Bridges

Export Promotion Councils and India's Export Infrastructure

India's export promotion ecosystem consists of multiple institutional layers including Export Promotion Councils (EPCs), Special Economic Zones (SEZs), Export-Oriented Units (EOUs), and various central and state government schemes. The new Export Promotion Mission consolidates fragmented export support under a single outcome-based framework.

  • India has approximately 40 Export Promotion Councils covering different product categories, functioning as the primary interface between exporters and the government.
  • India's merchandise exports were approximately $437 billion in FY 2024-25, with a target of $800 billion in goods and services exports by 2030.
  • SEZs contributed approximately 30% of India's total exports but have faced criticism for revenue foregone and limited backward linkages.
  • The Districts as Export Hubs (DEH) initiative, launched under the new mission, aims to decentralise export activity by identifying export-worthy products from each district.
  • India has approximately 14 million MSMEs engaged in manufacturing, but fewer than 5% are export-oriented, indicating massive untapped potential.

Connection to this news: The seven new measures specifically target MSME exporters and e-commerce exporters, addressing the gap where small enterprises have manufacturing capability but lack the financial infrastructure, market knowledge, and logistics support to export competitively.

MSME Credit Gaps and Export Finance

Access to affordable and adequate credit remains the primary constraint for MSME exporters in India. Traditional export finance products (packing credit, post-shipment credit) often require collateral that small exporters cannot provide, and the cost of export credit has been higher than in competitor countries like Vietnam and Bangladesh.

  • The credit gap for Indian MSMEs is estimated at approximately Rs 25-30 lakh crore, with export-oriented MSMEs particularly underserved.
  • The new Direct E-Commerce Credit Facility provides up to Rs 50 lakh with 90% guarantee coverage, eliminating the collateral barrier for small e-commerce exporters.
  • The Overseas Inventory Credit Facility offers up to Rs 5 crore with 75% guarantee coverage and 2.75% interest subvention, enabling MSMEs to maintain inventory in overseas markets.
  • Export Factoring Support provides a 2.75% interest subsidy on factoring transactions, capped at Rs 50 lakh per MSME annually.
  • The interest subvention approach subsidises the cost of credit rather than providing direct grants, making it WTO-compliant under the Agreement on Subsidies and Countervailing Measures.

Connection to this news: The credit-focused interventions directly address the finding that Indian MSMEs' export competitiveness is constrained not by production capability but by working capital availability and the high cost of trade finance.

Non-Tariff Barriers and International Compliance

Non-tariff barriers (NTBs) including quality standards, testing requirements, certifications, and sanitary and phytosanitary measures have become the primary obstacles to Indian exports in developed markets. Many Indian MSMEs lose export orders not because of price or quality issues but because they lack the certifications and compliance documentation required by importing countries.

  • The Trade Regulations, Accreditation and Compliance Enablement (TRACE) intervention provides partial reimbursement of 60% for compliance costs under the Positive List and 75% under the Priority Positive List.
  • India exports to over 200 countries, each with different standards and certification requirements, making compliance particularly challenging for small exporters.
  • The EU's Carbon Border Adjustment Mechanism (CBAM), which begins full implementation in 2026, will impose carbon-based tariffs on Indian exports of steel, aluminium, cement, fertilisers, and electricity.
  • The Logistics Interventions for Freight and Transport (LIFT) programme provides up to 30% reimbursement of freight expenditure for exporters from northeastern and hilly regions, capped at Rs 20 lakh per exporter annually.
  • The INSIGHT component will develop trade intelligence systems to help exporters identify market opportunities, navigate regulatory requirements, and benchmark against global competitors.

Connection to this news: The compliance-focused interventions recognise that India's export growth increasingly depends on meeting stringent international standards rather than just reducing tariffs, reflecting the shift from tariff-based to standards-based barriers in global trade.

Key Facts & Data

  • Export Promotion Mission outlay: Rs 25,060 crore (FY 2025-26 to 2030-31).
  • Components operational: 10 out of 11 planned interventions.
  • Previously launched (January 2026): Market Access Support, Interest Subvention for Export Credit, Collateral Support.
  • Direct E-Commerce Credit Facility: up to Rs 50 lakh, 90% guarantee coverage.
  • Overseas Inventory Credit Facility: up to Rs 5 crore, 75% guarantee, 2.75% interest subvention.
  • Export Factoring Support: 2.75% interest subsidy, Rs 50 lakh cap per MSME per year.
  • LIFT: 30% freight reimbursement for northeastern/hilly region exporters, Rs 20 lakh cap.
  • TRACE: 60% compliance cost reimbursement (Positive List), 75% (Priority Positive List).
  • Two sub-schemes: Niryat Protsahan (financial enablers) and Niryat Disha (ecosystem support).