Trade Credits, Pre-Shipment Financing, Thrust for Newer Markets amongst other measures to boost MSME sector

MSME accounts for 45% of the Exports, 30% of the GVA. With government support, their integration in the
global supply chain will make India an economic superpower by 2047: Dr. Kalantri

All India Association of Industries (AIAI) and World Trade Centre Mumbai has called for urgent, targeted
interventions for micro and small enterprises in the forthcoming Union Budget 2026–27, highlighting that
this segment is under severe stress from policy asymmetry, rising compliance costs and repeated external
economic shocks. In a detailed policy memorandum submitted to the Union Finance Ministry, AIAI and
WTC Mumbai have advocated for time‑bound, budget‑backed measures to protect employment, sustain
domestic manufacturing capacity and strengthen India’s export competitiveness through MSMEs.

Elaborating the suggestions enumerated in the said memorandum, Dr. Vijay Kalantri, President of the
All-India Association of Industries (AIAI) and Chairman, World Trade Centre Mumbai said, “MSMEs are
not struggling due to inefficiency but due to structural disadvantages including high cost of credit, delayed
payments, and disproportionate compliance burden”.

Emphasising credit as the single biggest constraint, Dr. Kalantri said, “A national, real-time credit
evaluation framework should be drawn up by mandating invoice–payment pairing linked to GSTN which
will facilitate the use of Trade Credits as a tool of finance. This will build a real-time credit infrastructure
where payment behaviour and verified cash-flow drives access, rather than credit appraisal on backwardslooking balance sheets. This reform will not cost a single paisa to the government but at the same time has
potential to solve the credit crisis”.

“The past year has seen many geoeconomic upheavals which has adversely impacted MSMEs. We will not
achieve the goal of Viksit Bharat 2047 unless we support our MSMEs. As exports drive the MSMEs sector,
any change in the markets has ramifications down the line. The government keeping this in mind should
place thrust on newer markets and explore opportunities where our MSMEs can participate by signing
trade deals and advocating for borderless commerce”, Dr. Kalantri stressed.

“Government should also draw a policy outline for pre-shipment financing to support MSMEs from gate to
port. This whole government approach will strengthen the export capabilities of the MSMEs thereby
supporting job creation and inclusive government. Further, budgeted support for MSME e‑commerce
onboarding, logistics integration and export documentation will help smaller firms participate in domestic
and global value chains, thereby percolating economic growth till the bottom”, suggested Dr. Kalantri.

The recommendations come in the light of the Union Budget 2026-27 and are a part of broader role which
All India Association of Industries and World Trade Centre, Mumbai play to convey the on-ground reality of
the economy to the policymakers and suggest measures which better the trade, investment and
manufacturing climate of the country.

Regards,
Sangeeta Jain
Senior Director
All India Association of Industries (AIAI)