Government to cover certification costs for micro and small exporters under Export Promotion Mission

The Indian government has announced plans to bear the entire cost of expensive international certifications for micro and small enterprises under the Export Promotion Mission (EPM). Commerce and Industry Minister Piyush Goyal urged existing and new exporters to approach the Directorate General of Foreign Trade (DGFT) for financial support to access global markets.

The EPM was approved by the government in November last year with an overall outlay of Rs 25,060 crore spanning six financial years. The mission operates through two sub-schemes: Niryat Protsahan, backed by Rs 10,401 crore, and Niryat Disha, backed by Rs 14,659 crore.

Addressing reporters, Goyal stated that the administration is prepared to support any entity seeking to export globally. For micro and small enterprises, the government is willing to cover the full cost of certifications, including compliance expenses for European Union regulations such as the Carbon Border Adjustment Mechanism (CBAM) and the EU Deforestation Regulation (EUDR). Support for other businesses will be extended on a graded basis.

These announcements arrive as micro, small and medium enterprises (MSMEs) voice growing concerns over the high costs associated with European regulatory compliance. Business owners have flagged the financial burdens of meeting stringent reporting, emissions-monitoring, certification, and traceability requirements, noting these demands risk raising export costs and reducing the competitiveness of Indian goods in Europe.

A specific component of the EPM, known as Trade Regulations, Accreditation and Compliance Enablement (TRACE), provides financial assistance to exporters for international testing, inspection, and certification requirements. Support under TRACE is available to MSME exporters possessing a valid Importer Exporter Code (IEC) and a valid MSME Udyam Registration Number, focusing on certifications listed on a notified positive list and priority positive list.

For certifications on the Positive List, financial assistance reaches 60 percent of the actual cost net of taxes or Rs 25 lakh, whichever is lower. For the Priority Positive List, support increases to 75 percent of the actual cost net of taxes or Rs 25 lakh, whichever is lower, with an annual cap of Rs 25 lakh per exporter.

Trade data indicates that India's exports to EU countries declined by 4.57 percent to USD 72.4 billion in 2025-26, compared to USD 75.85 billion in 2024-25. The EU represented approximately 17 percent of India's total merchandise shipments during the previous fiscal year, while merchandise imports from the region rose by 9 percent to USD 66.18 billion.

"The decision to absorb compliance and certification costs for micro and small enterprises addresses a major financial hurdle in international trade. Navigating strict European regulations like CBAM and EUDR often strains smaller balance sheets. By providing direct financial backing through the Export Promotion Mission and TRACE framework, the government is actively lowering entry barriers, which will help small Indian businesses maintain their competitive edge in international markets." — Dr. Shishir Gupta, Founder & CEO, StartupLanes