The Government of India has extended the interest subvention benefit for micro and small enterprises engaged in the export of select iron and steel products, providing a crucial financial cushion to exporters navigating global market uncertainties.
According to an official notification by the Directorate General of Foreign Trade (DGFT), the benefit will apply to 167 specific iron and steel product categories, including non-alloy pig iron, various grades of steel, and ferro alloys. The extension is aimed at supporting small exporters facing volatile global demand, pricing pressures, and rising input costs.
Under the scheme, eligible exporters will receive interest subvention on pre- and post-shipment export credit, effectively lowering borrowing costs and improving access to working capital. The benefit is strictly limited to micro and small enterprises, with medium-sized firms excluded from the scope of the scheme.
This move is part of a broader export support framework announced earlier, under which the government rolled out a ₹7,295 crore package comprising ₹5,181 crore for interest subvention and ₹2,114 crore for collateral support. The initiative is designed to enhance credit flow and financial stability for exporters, particularly in sectors sensitive to global trade cycles.
The interest subvention mechanism reduces the effective interest burden on export loans, allowing MSMEs to manage liquidity more efficiently, execute orders on time, and remain competitive in international markets. The scheme operates over a multi-year period from 2025 to 2031, ensuring sustained support for exporters.
Industry observers note that the targeted inclusion of iron and steel products signals a focused effort to support downstream and value-added segments of the steel industry, where smaller firms play a critical role. By easing credit costs, the policy is expected to strengthen export momentum, improve capacity utilisation, and encourage greater participation of MSMEs in global trade.
The extension also reflects the government’s continued emphasis on export-led growth, with MSMEs forming a vital component of India’s manufacturing and trade ecosystem. Access to affordable credit remains a key enabler for these enterprises, particularly in sectors like steel where margins are often sensitive to fluctuations in raw material and energy costs.
Overall, the decision is expected to provide short- to medium-term financial relief, while reinforcing the long-term objective of making Indian exporters more resilient and competitive in the global marketplace.
