Synopsis: After a key meeting with Prime Minister Narendra Modi, the government is preparing measures to ease credit access and simplify quality control compliance for exporters. The move aims to strengthen India’s trade competitiveness amid global economic headwinds and slowing demand.
In a major policy push to bolster India’s export ecosystem, the government is set to ease credit access and streamline compliance requirements for exporters and importers following Prime Minister Narendra Modi’s high-level meeting with representatives from key trade sectors last week.
Sources told Business Today that the meeting focused on supporting India’s export-led growth and addressing challenges faced by labour-intensive industries such as apparel, leather, gems and jewellery, handicrafts, engineering, and seafood.
The meeting, attended by Finance Minister Nirmala Sitharaman, Commerce and Industry Minister Piyush Goyal, Cabinet Secretary T.V. Somanathan, and senior officials from the textiles, commerce, and MSME ministries, also included heads of various export promotion councils.
Exporters Seek Easier Credit and Higher Working Capital
According to a senior government official, exporters requested the government to urge banks to adopt a more flexible approach in extending credit and setting lending norms. Many exporters highlighted difficulties in securing sufficient working capital, especially amid rising input costs and volatile demand from key international markets.
“Exporters want banks to be more lenient in lending larger amounts, particularly to high-performing sectors,” the official noted, emphasizing that better financial access is critical for maintaining India’s global competitiveness.
Responding to these concerns, PM Modi assured full government support, promising policy interventions and financial facilitation to ensure exporters remain resilient despite challenges such as increased U.S. tariffs and sluggish global demand.
Review of Quality Control Orders (QCOs)
In addition to easing financial constraints, the government is also set to review the Quality Control Orders (QCOs) framework. Several industries had raised concerns that excessive compliance costs and import delays under current QCO norms were disrupting supply chains.
The Commerce Ministry is now considering restricting QCOs only to finished products, rather than applying them to intermediate or raw materials, a move expected to reduce procedural hurdles for exporters and MSMEs.
Officials clarified that the goal is to maintain product quality and consumer safety while simultaneously improving the ease of doing business, particularly for export-driven industries dependent on imported components.
India’s Trade Performance
Despite steady growth, India’s share in global trade remains modest at around 2 per cent, with 1.6 per cent in goods exports and 3.3 per cent in services exports.
In September 2024, exports rose 6.74% to $36.38 billion, while imports surged 16.6%, widening the trade deficit to $31.15 billion.
For the April–September 2024 period, exports increased 3.02% to $220.12 billion, whereas imports rose 4.53% to $375.11 billion, resulting in a trade deficit of $154.99 billion.
These figures underline the need for robust government intervention to enhance India’s export competitiveness through better credit availability, simplified procedures, and stronger policy backing.
A Push for Global Competitiveness
The upcoming policy measures reflect the Modi government’s continued emphasis on export growth as a key driver of economic expansion. By improving credit flow, reducing bureaucratic bottlenecks, and maintaining quality standards, the government hopes to make Indian goods more competitive in global markets.
As global trade faces uncertainty, these initiatives could help Indian exporters sustain momentum, expand into new markets, and strengthen the country’s position in international commerce.
Disclaimer: This article is based on information from official meetings and government sources. Policy details are subject to change as new guidelines and frameworks are finalized by the concerned ministries.
