Government Designs Dedicated Export Finance Mechanism to Support Liquid MSMEs

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To address critical working capital constraints and long payment cycles, the Ministry of MSME is designing a dedicated export finance window in collaboration with the Department of Financial Services. Unveiled by MSME Secretary Bharat Khera, the initiative directly responds to industry concerns regarding a 90-day cash-flow gap created when exporters must pay domestic suppliers within 45 days while waiting for overseas proceeds. The government has already deployed the Emergency Credit Line Guarantee Scheme (ECLGS) to counter logistical and liquidity disruptions stemming from the ongoing West Asia crisis. To ensure long-term stability, bank credit tracking has scaled significantly, with the Credit Guarantee Scheme facilitating nearly ₹3 trillion in guarantees. Furthermore, the government has officially requested the Commerce Ministry to integrate dedicated, legally binding MSME chapters into all upcoming free-trade agreements.

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