Federal Government to Offer Assistance to Industry Over Short, Extended Periods Due to Tariff Impositions

Published on August 31, 2025

The Indian government has unveiled a three-tiered action plan to support exporters, in response to the escalating US tariffs on Indian exports. The plan, currently under review by the Expenditure Finance Committee, aims to provide immediate liquidity and compliance relief to exporters, while also focusing on long-term measures to build a resilient, diversified, and globally competitive export base.

The short-term support will be offered through trade finance access, with schemes like interest subvention, factoring, e-commerce export cards, and collateral support. The plan also seeks to leverage existing trade agreements and new market access opportunities, including India's FTAs with the UK, UAE, and Australia.

In the medium term, the focus will be on intensifying buyer-seller outreach, strengthening GST reforms to enhance competitiveness, and leveraging India's FTAs to their full potential. The measures also include SEZ flexibility and maintaining order levels in vulnerable sectors.

In the long term, the government is committed to building a resilient, diversified, and globally competitive export base, anchored in the Export Promotion Mission, SEZ reforms, and supply chain resilience initiatives. The three-stage action plan, developed by the United Nations Development Programme (UNDP), also extends support for export compliance, branding and packaging initiatives, logistics and warehousing assistance, trade intelligence, and skilling.

The US imposed 50% reciprocal tariffs on Indian exports on August 7, as a punishment for India's purchase of Russian oil. Exporters across sectors have sought help from the government, with a critical risk identified being a drop in order levels, particularly in SEZ-based units which contribute significantly to labor-intensive exports. The goal is to build resilience in supply chains through structural reforms.

However, the action plan does not mention any specific new market access opportunities beyond the existing FTAs, and the article does not provide any new data about the economy or the stock markets. The article also does not discuss any other significant events or developments, nor does it provide information about the status of the challenge process involving Jaiprakash Associates.

Federal Government to Offer Assistance to Industry Over Short, Extended Periods Due to Tariff Impositions