The government’s new support measures for exports, including a ₹45,060-crore liquidity assistance package, come amid severe global headwinds (including oppressively high US tariffs, likely the most consequential among them). The support package earmarks ₹25,060 crore to improve liquidity access for MSMEs through instruments such as discounted interest that ease cash flow and reduce payment risks, collateral support, and credit enhancement for riskier markets. It will also offset several costs associated with growing market access, such as those incurred
The government’s new support measures for exports, including a ₹45,060-crore liquidity assistance package, come amid severe global headwinds (including oppressively high US tariffs, likely the most consequential among them). The support package earmarks ₹25,060 crore to improve liquidity access for MSMEs through instruments such as discounted interest that ease cash flow and reduce payment risks, collateral support, and credit enhancement for riskier markets. It will also offset several costs associated with growing market access, such as those incurred in meeting destination-jurisdiction standards, in moving goods from remote areas to ports, etc. This is important given that MSMEs account for close to 45% of India’s exports and mark a large presence in some of the sectors hit hardest by the Trump tariff tempest. Under the ₹20,000-crore credit guarantee scheme, lending institution members of the National Credit Guarantee Trustee Company will get 100% credit guarantee coverage in extending additional credit to eligible exporters.
This support will likely blunt some of the tariff impact for sectors such as textiles, leather, gems and jewellery — if implementation issues are resolved comprehensively and promptly. In an environment where the World Trade Organization predicts global merchandise trade volumes will grow by just 2.4% in 2025 and a mere 0.5% in 2026, these measures do offer some salve, but a lot more is needed to sustain the growth that was seen before 2024 — more so with global services trade growth also likely to slow. To that end, India must ensure favourable terms in the bilateral trade agreements it is negotiating.
President Donald Trump has indicated that a trade deal with India is imminent, as is the relaxing of the punishing tariffs India faces in its largest export market. But there will be lingering unease, given the mercurial manner in which Washington wields policy. Growing export markets elsewhere become all the more important in this context.
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