Why in News?

• Amid rising global trade uncertainties and the imposition of steep 50% tariffs by the US on Indian goods, the Union Cabinet has approved a comprehensive Export Promotion Mission (EPM) worth ₹25,060 crore.
• The initiative seeks to strengthen India’s export competitiveness, especially in labour-intensive sectors such as textiles, leather, gems & jewellery, engineering goods, and marine products.

What’s in Today’s Article?

• Background - Tariff Pressure and Export Slowdown
• Key Highlights of the Export Promotion Mission (EPM)
• Other Cabinet Decision - ₹20,000-Crore Credit Guarantee Scheme for Exporters (CGSE)
• Sectoral Impact and Stakeholder Responses
• Performance of Indian Exports
• Way Forward
• Conclusion

Background - Tariff Pressure and Export Slowdown:

• The US, India’s largest export destination, imposed 50% tariffs (effective August 27, 2025), making Indian goods among the most heavily taxed globally after China.
• India’s exports to the US declined 12% (in September 2025), with engineering goods down 9.4%.
• Textile and apparel exports—28% of which go to the US—fell 10.34% year-on-year in September 2025.
• The government’s move (EPM) is a strategic response to safeguard employment, maintain export momentum, and diversify into new markets.

Key Highlights of the Export Promotion Mission (EPM):

• Outlay and duration:
  • Total outlay: ₹25,060 crore
  • Duration: FY 2025–26 to FY 2030–31 (6 years)
• Consolidates: Key export support schemes like Interest Equalisation Scheme (IES) and Market Access Initiative (MAI).
• Objectives:
  • Enhance credit availability and reduce cost of credit for exporters, particularly MSMEs.
  • Address non-tariff barriers, logistics bottlenecks, branding, and market access challenges.
  • Enable diversification into new and high-risk markets.
• Implementation framework: The Directorate General of Foreign Trade (DGFT) will manage the mission, which will be implemented through two sub-schemes -
  • Niryat Protsahan (₹10,401 crore): Focus on financial interventions, and includes interest subvention, export factoring, credit guarantees, credit cards for e-commerce exporters, and credit enhancement tools. It aims to improve trade finance access and working capital liquidity.
  • Niryat Disha (₹14,659 crore): Focus on non-financial interventions, and covers international branding, packaging, trade fairs, warehousing, logistics support, inland transport reimbursement, and capacity-building initiatives.
• Digital and flexible framework: The mission provides a digitally driven, comprehensive, and flexible framework to meet contemporary trade needs and align export support with dynamic global conditions.

Other Cabinet Decision - ₹20,000-Crore Credit Guarantee Scheme for Exporters (CGSE):

• Objective: To provide additional working capital and collateral-free loans up to 20% of sanctioned limits for exporters.
• Coverage: 100% guarantee by National Credit Guarantee Trustee Company (NCGTC) to lending institutions.
• Beneficiaries: Exporters including MSMEs.
• Timeline: Scheme valid till March 2026.
• Impact: Expected to enhance liquidity, support diversification, and ensure smooth business operations.

Sectoral Impact and Stakeholder Responses:

• Textile and apparel sector: The Confederation of Indian Textile Industry (CITI) welcomed the mission, stating it will make Indian textiles globally competitive and help leverage free trade agreements (FTAs) for market expansion.
• MSME empowerment: Federation of Indian Export Organisations (FIEO) praised EPM’s unified financial and non-financial framework, stating it addresses long-term challenges such as high compliance costs, weak branding, and logistics inefficiencies.
• Gems and jewellery sector: The GJEPC appreciated measures like interest subvention and expanded trade fair support, calling them crucial for first-time exporters and MSMEs.

Performance of Indian Exports:

• Overall growth: India's total exports (merchandise and services) grew by 5.19% in April–August 2025 compared to the same period last year.
• Total value: The combined export value was USD 346.10 billion in April–August 2025.
• Merchandise exports: Saw a growth of 2.31% during April–August 2025, reaching USD 183.74 billion.
• Non-Petroleum and non-gems and jewellery exports: Showed strong growth of 7.76% in the same period, reaching USD 146.70 billion.
• Growth drivers: Key sectors contributing to growth include engineering goods, electronics, pharmaceuticals, and chemicals.
• Challenges: The merchandise trade deficit (in September 2025) widened as imports grew at a faster rate than exports.

Way Forward:

• Strengthen trade finance: Ensure timely and affordable credit access for MSMEs through digital platforms.
• Enhance market intelligence: Build data-driven mechanisms to identify new export destinations.
• Promote Brand India: Invest in global marketing, packaging, and e-commerce support.
• Address structural bottlenecks: Improve logistics infrastructure and reduce compliance burdens.
• Leverage FTAs: Use existing and upcoming trade agreements to expand export markets.

Conclusion:

• The Export Promotion Mission (EPM) and Credit Guarantee Scheme for Exporters mark a decisive step toward bolstering India’s export resilience amid rising global protectionism and tariff barriers.
• Together, they signify a policy shift toward sustainable, competitive, and inclusive export growth in the post-pandemic global economy.