The government has announced seven new initiatives to boost the country’s exports, including credit support for e-commerce exporters and support to alternative trade finance instruments. These steps have been taken under the Rs 25,060 crore export promotion mission, three of the 10 components of which have already been implemented in January.
The seven major initiatives announced by the government are as follows:
Direct E-Commerce Credit Facility – Loan assistance up to Rs 50 lakh to e-commerce exporters with 90% guarantee coverage.
Overseas Inventory Credit Facility – Assistance up to Rs 5 crore, 75% guarantee and 2.75% interest subsidy for holding stocks abroad.
Interest Subsidy on Export Factoring – 2.75% interest subsidy on factoring cost for affordable working capital for MSMEs (limit Rs 50 lakh per annum).
Trade finance support for high risk/new markets – support to credit enhancement instruments like Letter of Credit confirmation and negotiations.
TRACE (Trade Regulations, Accreditation and Compliance Enablement) – Reimbursement of 60% to 75% of international testing, certification and compliance expenses (limit Rs 25 lakh per IEC).
FLOW (Logistics, Overseas Warehousing and Fulfillment) – Support up to 30% of the project cost for access to overseas warehousing, e-commerce export hubs and global distribution networks.
LIFT and INSIGHT Support – Up to 30% freight assistance (LIFT) to exporters from remote/hilly areas and up to 50% financial support (INSIGHT) for trade intelligence and facilitation projects.
The government says that through these coordinated financial and ecosystem-based measures, reduction in cost of capital, expansion of trade finance options, improvement in compliance capacity, resolution of logistics bottlenecks and better integration into global markets for MSMEs will be ensured.
