Budget: Allocation for export promotion schemes dips 17% to Rs 2,250 cr

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The government has earmarked Rs 2,250 crore for export promotion schemes for 2025-26, down 17 per cent from Rs 2,718.73 crore allocated in the revised Budget estimates for 2024-25.

According to the Budget document, allocation for Department of Commerce has dipped to Rs 5,300.99 crore for the next fiscal as against Rs 5,624 crore in the revised estimates (RE) for the ongoing fiscal year.

Under export promotion schemes, no fund is allocated for market access initiative (MAI) and interest equalisation scheme. Though the scheme ended on December 31, 2024, the exporting community has been pitching hard for its extension.

Now the government has announced plans to roll out an export promotion mission.

"New scheme namely, Export Promotion Mission, has been formulated to act as a catalyst to facilitate India's export competitiveness," it said.

Finance Minister Nirmala Sitharaman in her Budget speech on Saturday said that through the mission, the government will facilitate exporters to get easy access to credit, cross-border factoring support, and support to MSMEs to tackle non-tariff measures in overseas markets.

Funds for the Duty Drawback Scheme too have dipped to Rs 181.9 crore for 2025-26 as against Rs 258.2 crore in the RE for 2024-25.

Duty drawback is a duty neutralisation scheme designed to promote exports. Its aim is to compensate all duties or taxes embedded in the manufacturing cost of export products. The basic concept of the scheme is that export products should not carry the country's taxes so that these are revenue neutral and can compete on an equal footing in the world market.

However, allocations for tea, coffee, rubber and spices board have increased to Rs 771.55 crore, Rs 280 crore, Rs 360.31 crore and Rs 153.81 crore, respectively for the next fiscal.

The document stated that in Budget 2021-22, it was proposed that Rs 1,000 crore will be provided for the welfare of tea workers especially women and their children in Assam and West Bengal and a special scheme will be devised for the same.

Further to this announcement, the Pradhan Mantri Cha Shramik Protsahan Yojana (PMCSPY) has been finalized and approved for the implementation in 2024-25 and 2025-26.

The scheme is aimed at making need-based interventions in tea garden areas for strengthening provisions of education and health services to the tea workers.

In December, exports contracted for the second month in a row by about 1 per cent year-on-year to USD 38.01 billion due to global uncertainties, while imports rose by about 5 per cent to USD 59.95 billion.

Cumulatively, during April-December this fiscal, exports recorded a growth of 1.6 per cent to USD 321.71 billion and imports rose 5.15 per cent to USD 532.48 billion.

The trade deficit, the difference between imports and exports, during April-December widened to USD 210.77 billion from USD 189.74 billion during the same period previous fiscal.