Embracing Global Markets – The Export Potential for Indian MSMEs by 2047

Indian Micro, Small, and Medium Enterprises (MSMEs) and traders have a crucial role to play in becoming exporters against the backdrop of the global scenario and the Indian government’s vision for 2047. The demand for Indian products and services in the global market is increasing, providing substantial opportunities for MSMEs. Through exports, MSMEs can establish their products on a global platform, leading to business growth and economic stability. The Indian government is developing the concept of an Atmanirbhar Bharat (Self-Reliant India) by 2047, which places significant emphasis on the development of MSMEs.

Through exports, MSMEs can empower local industries to compete globally. Additionally, as the demand for quality products rises globally, MSMEs have the opportunity to improve the quality of their offerings. Therefore, there is a need to enhance the export capabilities of MSMEs within the framework of India’s vision for 2047, which will foster the country’s economic stability and growth. For MSMEs, exports represent a golden opportunity to establish a presence in international markets. India’s economy is on the rise, and the export sector holds great potential. Understanding the processes and government subsidy schemes necessary to become an exporter is vital. In this article, we will explore various government schemes that will be beneficial for aspiring exporters.

What is an Exporter?

An exporter is an individual or entity that sells goods or services outside the country. Engaging in the export industry not only fosters business growth but also improves the country’s economic condition by generating foreign exchange. This allows your products to gain a foothold in the global market. However, this process comes with various challenges, requiring adequate knowledge and resources.

The Process of Becoming an Exporter

Choosing a Business / Product / Service

Select a suitable product or service for your business. Consider whether this product is popular in the global market. Also, take into account your expertise in the particular product. When choosing a business, it’s essential to consider market trends and consumer preferences.

1. Market Research

Study the demand, competition, consumer preferences, and other critical factors in the international market. Think about which countries you plan to export to. Understanding market trends and needs will enable you to grow your business more effectively, helping you make informed decisions.

2. Export Registration

You need to register as an exporter. For this, you must obtain a registration certificate from at least one trade ministry. This certificate is necessary for the legality of your business. After completing the registration process, you can formally start your export business.

Government Subsidy Schemes

1. Capital Subsidy

Credit Linked Capital Subsidy Scheme (CLCSS): This scheme aims to facilitate capital for small and medium enterprises. The government provides a subsidy of up to 25% on the infrastructure required for your business. This makes it easier for you to acquire modern equipment and integrate new technologies into your operations.

2. First Time Exporter Scheme-

Market Access Initiative (MAI): This initiative is designed to assist first-time exporters. It provides training to understand various stages of the export process and offers financial support for marketing efforts. This helps your business gain international access.

3. Export Development Scheme

Niryat Bandhu Scheme: Under this scheme, exporters receive grants for technology enhancement, marketing, and quality control. This can lead to increased global recognition for your products, along with guidance on necessary resources for your export business, including training programs and workshops.

4. Export Credit Guarantee Corporation (ECGC)

ECGC Export Credit Insurance: ECGC helps exporters face various risks by providing protection against non-payment risks. This offers exporters a sense of security in the international market, helping to mitigate financial losses in case of defaults.

5. International Cooperation Schemes

Trade Facilitation Measures: The Indian government implements various cooperation schemes to promote international trade. These initiatives provide exporters with essential information, guidance, and resources to access global markets. They include trade fairs, workshops, and consultancy services, helping you compete on a global level.

6. Trade Exhibitions

India Trade Promotion Organization (ITPO): The government organizes various international trade exhibitions. Participating in these events gives you the opportunity to showcase your products on a global platform, allowing you to interact with potential customers. Such exhibitions help you build a significant professional network for your business.

7. Trade and Craft Training

Export Promotion Councils: These councils offer training on various aspects of the export process. Topics covered include export policies, documentation, and international regulations. This training inspires greater confidence in the export process, preparing you to make informed decisions for your business.

Documents Required for Export

Exporters need to prepare several essential documents:

• Permits and Registrations: Necessary licenses and registration certificates for export.
• Commercial Invoice: The invoice sent to the customer.
• Packing List: A list of the packed goods.
• Shipping Documents: Documents required when shipping goods.

Product Preparation

Ensure the quality of your products. Verify that all standards are met, and understand the rules for packing and labelling. This will enhance the acceptability of your products in the global market.

1. Marketing Strategy

Determine how to sell your product in the international market. Utilize digital marketing, social media, and other channels. Effectively showcase the benefits and features of your product to increase demand.

2. Distribution System

Decide how your products will be distributed. Use international shipping companies to ensure safe delivery to customers. Maintain a well-planned distribution strategy to avoid any bottlenecks, which builds customer trust.

Additional Government Schemes for Exporters

• Focus Market Scheme (FMS)
• Merchandise Exports from India Scheme (MEIS)
• Service Exports from India Scheme (SEIS)
• Trade Facilitation Measures
• Duty Drawback Scheme
• Export Development Fund
• Integrated Textile Parks (ITPs)

Becoming an exporter is part of a long-term process, but with the right information, the utilization of government schemes, and continuous effort, you can succeed. By leveraging various government subsidy schemes, you can expand your business on a global scale.

Preparation, strategic planning, and appropriate guidance are essential. If you wish to initiate this journey in international trade, contact the AIMA Office promptly. Wishing you a prosperous Diwali 2024

CE Shreekant Patil

Founder at PARENTNashik, Chartered Engineer, Startup India Mentor, Certified LEAN MSME Consultant, Official Trade finance consultant at Euro Exim Bank, European Union, AfDB, ADB, EBRD (Europe).