Despite the fact that MSMEs contribute immensely to the exports, the growth story of exports from MSMEs does not seem promising. The capability of Indian MSME products to compete in international markets is reflected in its share of about 34% in national exports. In case of items like readymade garments, leather goods, processed foods, engineering items, the performance has been commendable both in terms of value and their share within the MSME sector while in some cases, like sports goods, they account for 100% share of the total exports of the sector. In view of this, export promotion from this sector has been accorded high priority in India’s export promotion strategy which includes simplification of procedures, incentives for higher production of exports, preferential treatments to MSMEs in the market development fund, simplification of duty drawback rules, etc. In order to facilitate a discussion on a policy environment to boost exports from the MSME sector, CII organized a policy dialogue session on the EXIM Policy for MSMEs in partnership with the Indian Institute of Foreign Trade (IIFT) on 28 July, 2014 in New Delhi.
As a background document to the Roundtable, this report sheds light on the status of MSME exports and discusses the chief reasons for a decreasing share of exports from this sector. The joint CII-IIFT report also elaborates on key strategies to enhance the share of exports from this sector which include policy recommendations, market penetration and quality enhancement measures as well as global best practices.