- By Soumyaroop Mukherjee
- Fri, 05 Sep 2025 05:02 PM (IST)
- Source:JND
The Government of India is seeking to provide additional economic relief to businesses affected by the recently imposed tariffs by the Trump administration on Indian goods."Government will come out with something to handhold those who have been hit by 50% tariffs," Sitharaman told CNBC TV18 without divulging any additional details.
According to reports published by Reuters, the government plans to offer credit guarantees on loans overdue by up to 90 days for small businesses and exporters. Exporters said labour-intensive sectors such as textiles, jewellery, and seafood (particularly shrimp), which all operate on margins of just 3%-5%, have been hit hardest, causing job losses in industrial hubs in Tamil Nadu and Prime Minister Narendra Modi’s home state of Gujarat.
"Textiles and apparel manufacturers in Tiruppur, Noida and Surat have halted production amid worsening cost competitiveness," S.C. Ralhan, president of the Federation of Indian Export Organisations (FIEO), said.
The proposed model will be based on similar lines to the one extended to MSMEs during the COVID-19 pandemic. Simultaneously, renewed efforts are being made by the government to implement the Export Promotion Mission, announced in the Union Budget 2025. The mission aims to expand the economic presence of Indian goods in the global markets.
What Are The Objectives Of The New Reliefs?
The proposed objective of these new economic reliefs is expected to address the following situations:
A crunch of liquid cash faced the small exporters.
Removal of the pressure of working capital, which has been heightened due to the tariffs.
Ensure job security for the people belonging to vulnerable sections of the export business.
To keep the production cycle running without any disruptions, while exploring new markets for Indian goods.
Indian exports to the US during the first four months of this financial year have reportedly risen 21.64 per cent to USD 33.53 billion. The exports in 2024-25 were at USD 86.5 billion. The US accounted for about 20 per cent of India's USD 437.42 billion worth of goods exports in 2024-25.
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However, since the announcement of 50 per cent tariffs by Trump, 66 per cent of the Indian exports to the USA have been affected, as per the Global Trade Research Initiative report. This has made it necessary for the government to come up with these kinds of measures.
The government, in August, when Trump's additional 25 per cent tariffs were imposed, had said that the exports would be hit in the short term, but it would not be a long-term loss, and assured the exporters of all possible help. The government further said, "Export diversification, new free trade agreements, rollout of export promotion mission and growing domestic market will help provide cushion to Indian exporters from the impact of US tariffs".
"It is an understood thing that 50% tariffs are going to impact trade. There will be an impact on the textile, chemicals and machinery sectors in the short run, but it will not be a very long-term loss. The industry is worried; they have been sending representations. The industry has pointed out that in the short run, their orders will face a slowdown, and they will face a liquidity crunch," Union Commerce and Industry Minister Piyush Goyal said, as quoted by PTI.
"We are trying to expedite the rollout of the Export Promotion Mission (EPM) as soon as possible, so that it will give some impetus and support to the industry", he added.
