Govt plans ₹25,000 cr export support mission to counter US tariff impact

Commerce ministry readies WTO-compliant schemes to aid exporters, diversify markets, and ease trade finance amid rising US tariffs

The commerce and industry ministry has firmed up support schemes worth about ₹25,000 crore under the Export Promotion Mission for a six-year period, amid continuing uncertainties from higher tariffs imposed by the US.

 

The proposal has been sent to the finance ministry for approval. Once it clears the contours and allocation, the schemes will be rolled out after the Union Cabinet’s nod, two people aware of the matter told Business Standard.

 

The schemes, designed under the Export Promotion Mission, will include World Trade Organization (WTO)-compliant interventions focusing on trade finance and easing market access for exporters. The government believes the mission addresses challenges that go beyond tariff- and trade-war-related uncertainties. “It goes much beyond tariff. Tomorrow, the situation may worsen. We are looking at a long-term strategy,” one of the persons mentioned above said.

 

The strategy is not limited to promotion but also aims at diversifying markets and the export basket to mitigate such risks in the future. It also seeks to push exporters to enhance the “exportability” of Indian products.

 

The development comes against the backdrop of exporters seeking government support, as they will soon face a 50 per cent tariff on goods shipped to the US. Sectors such as gems and jewellery, textile, and marine products like shrimp are expected to be among the hardest hit.

 

A ₹2,250 crore Export Promotion Mission was announced in the Union Budget for 2025-26 in February but has yet to be rolled out. 

The new schemes have been designed especially for small exporters, to help them secure collateral-free loans, promote alternative financing instruments through cross-border factoring, and provide assistance for high-risk markets, among other measures.

 

A direct subsidy-based approach is considered unlikely, as it is difficult to implement and raises concerns of moral hazard. It is also hard to assess the actual impact on exporters and justify the corresponding subsidy, apart from the risk of violating WTO norms.