Synopsis: The Union Cabinet has approved a ?20,000 crore Credit Guarantee Scheme for Exporters, offering 100% credit coverage to support MSMEs and expand India’s global trade footprint. The move aims to strengthen liquidity, create jobs, and accelerate progress toward the $1 trillion export goal.
In a major push to enhance India’s export competitiveness, the Union Cabinet, chaired by Prime Minister Narendra Modi, on Wednesday approved the Credit Guarantee Scheme for Exporters (CGSE). The initiative is designed to provide 100% credit guarantee coverage to member lending institutions (MLIs) for extending additional credit facilities up to ?20,000 crore to eligible exporters, including Micro, Small, and Medium Enterprises (MSMEs).
The scheme will be implemented by the Department of Financial Services (DFS) under the Finance Ministry, through the National Credit Guarantee Trustee Company (NCGTC) Ltd. A management committee, headed by the Secretary of DFS, will oversee the implementation and monitor progress to ensure effective execution.
According to an official statement, the CGSE will empower exporters by offering collateral-free credit, thus strengthening liquidity and ensuring smoother business operations. The scheme is also expected to diversify India’s export markets, boost competitiveness, and accelerate progress toward the government’s ambitious $1 trillion export target.
Exports remain a cornerstone of India’s economic growth, accounting for around 21% of GDP in FY 2024–25 and supporting over 45 million jobs. MSMEs alone contribute nearly 45% of total exports, making them a vital engine for sustainable economic expansion.
The government emphasized that enhanced financial assistance will help exporters adapt to changing global dynamics and explore new and emerging markets. By enabling additional liquidity and risk mitigation, the scheme ensures continued business growth and market expansion opportunities.
The decision comes amid global trade challenges such as tariff escalations affecting key sectors like textiles, leather, gems & jewellery, engineering goods, and marine products. Through this intervention, the government aims to protect export orders, safeguard employment, and strengthen India’s position in international trade.
The initiative aligns with the broader vision of Aatmanirbhar Bharat, reinforcing India’s resilience and self-reliance while promoting long-term export sustainability.
Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice. Readers are advised to consult official government releases or financial experts for detailed guidance.
