SDG 8: Decent Work and Economic Growth | SDG 9: Industry, Innovation, and Infrastructure | SDG 17: Partnerships for the Goals
Ministry of Commerce & Industry | Ministry of MSME | Ministry of Finance | Reserve Bank of India (RBI)
On January 2, 2026, the Government of India launched two major financial interventions under the NIRYAT PROTSAHAN sub-scheme of the Export Promotion Mission (EPM). These measures are designed as the “financial muscle” for MSMEs by lowering interest rates and providing credit guarantees, ensuring that small firms have the liquidity to fulfill large international orders without the burden of high-cost debt or heavy collateral.
While its sister scheme, NIRYAT DISHA, handles non-financial enablers like branding and participation in trade fairs, NIRYAT PROTSAHAN focuses exclusively on making trade finance affordable.
The two key interventions are:
Interest Subvention for Export Credit: Provides a base interest subsidy of 2.75% on pre-shipment and post-shipment rupee export credit. The scheme covers a “positive list” of tariff lines representing 75% of India’s export categories, specifically prioritizing labor-intensive and capital-intensive MSME sectors.
Market-Linked Incentives: Exports to under-represented or emerging global markets may qualify for additional interest incentives beyond the 2.75% base.
Digital Implementation: All support is capped at ₹50 lakh per Importer Exporter Code (IEC) for FY 2025–26, with the Directorate General of Foreign Trade (DGFT) and RBI managing the operational rollout through unified digital platforms.
Collateral Guarantee Support: This second intervention aims to improve access to finance by providing government-backed guarantees for export credit, effectively enabling collateral-free lending for eligible MSME exporters.
Guarantee coverage: Up to 85% for Micro and Small exporters and 65% for Medium exporters.
Exposure limit: Maximum guaranteed outstanding of ₹10 crore per exporter per financial year.
Complementarity: Designed to work alongside existing credit guarantee mechanisms; CGTMSE to notify guidelines followed by a pilot phase and integration into broader export promotion reforms.
Policy Relevance
These interventions mark a strategic shift from fragmented export subsidies to a single, outcome-based mechanism aligned with the vision of Viksit Bharat @2047. By reducing credit costs and addressing collateral gaps, the government is directly tackling the primary structural barriers that keep 95% of India’s MSMEs focused only on the domestic market.
Strategic Impact for India:
Formalization of Trade: Mandatory use of the VAHAN-based validation for logistics and digital trade portals for subvention claims forces a move toward a transparent, data-driven export ecosystem.
Geographical Diversification: Additional subvention for emerging markets encourages Indian exporters to move beyond traditional hubs in the US and EU, tapping into growth regions in Africa and Latin America.
Job Protection: By prioritizing labor-intensive sectors like textiles and leather, the policy acts as a buffer against global trade volatility, protecting millions of livelihoods in small-town manufacturing clusters.
Relevant Question for Policy Stakeholders: How will the RBI ensure that the bi-annual review of subvention rates in March and September effectively captures sudden spikes in global LIBOR or domestic repo rates to prevent a ‘liquidity shock’ for MSMEs with long-cycle export orders?
Follow the full news here: Two Key Interventions Launched to Strengthen MSME Exports under Export Promotion Mission