In what could spell some relief for exporters struggling with US tariffs and slowdown in global demand, the government is set to release over ₹1,100 crore outstanding payments for the interest equalisation schemes (IES) and market access initiative (MAI) pending for over a year in some cases.
“The clearance of the pending payments has been approved as part of the export promotion mission (EPM) package. Once the funds are allocated under revised estimates for budget FY26, the exporters’ dues can be cleared,” a source tracking the matter told businessline.
The popular IES, under which the government subsidised interest on pre- and post-shipment export credit for eligible exporters, was allowed to lapse on December 31, 2024. Not only did the government not continue the scheme despite strong protests from exporters, who argued that high costs of funds were hurting their competitiveness, past dues were also kept pending.
“The Commerce Department did not have enough funds to clear exporters’ dues under the IES which adds up to around ₹800-850 crore. But now that the Cabinet has cleared the EPM, the payments are accounted for. The allocation will be made as part of the revised estimates for the budget for the ongoing fiscal. Exporters will hopefully get the payments soon,” the source said.
Similarly, payments are also pending under the MAI for exporters, totalling about ₹300 crore, the source pointed out.
The MAI scheme
Under the MAI scheme, financial assistance is given to Indian exporters to help them develop new markets and increase their share in existing ones, by giving funds for activities such as participating in exhibitions, trade fairs and conducting market studies.
“Under the MAI scheme, funds were sanctioned by the government till the end of FY25. Payments are due not only for FY25 but in some cases also for the previous fiscal,” a Delhi-based exporter pointed out.
While announcing the ₹25,000 crore EPM cleared by the Cabinet earlier this month, the government clarified that both the IES and the MAI would be subsumed in it. The EPM is for a period of six years, from FY26 to FY31.
“We do not know yet if exporters will get any interest subvention for the last quarter of FY25 as the scheme was suspended on December 31. Whatever new scheme would be there, is likely to be applicable from April 1, 2025,” the source said.
The IES was first implemented in April 2015 for five years. It covered non-MSME exporters of about 410 identified products and all exporters from the MSME sector.
The scheme was subsequently extended for limited periods of time and the last extension, which only covered MSME exporters, lapsed on December 31, 2024.
