Blitz Bureau
NEW DELHI: India’s micro, small and medium enterprises (MSMEs) — the backbone of the country’s manufacturing and export economy — are facing a crisis that industry leaders warn could erode decades of hard-earned gains. With US tariffs hitting as much as 50 per cent on critical product categories, nearly $30 billion worth of MSME exports and 70,000-80,000 jobs now hang in the balance.
Amid this turmoil, attention has turned to the Government’s Global Market Intelligence System (GMIS) — a portal promised more than three years ago to equip MSMEs with real-time trade data and market insights. The system, designed to help smaller firms identify export opportunities and navigate regulatory hurdles, remains non-functional, fuelling anxiety in India’s industrial clusters.
Tariffs slice into MSME lifelines
The United States remains one of India’s top export markets, particularly for MSME-led sectors such as leather goods, gems and jewellery, textiles, handicrafts and marine products. In recent months, Washington has imposed punitive duties of up to 50 per cent across several categories, significantly raising costs for Indian exporters.
Industry estimates suggest more than 55 per cent of India’s US-bound exports are now exposed to higher tariffs, raising the spectre of a 40-50 per cent fall in shipments. For MSMEs, which operate on slender margins and depend on overseas orders for survival, this represents an existential threat.
“The situation is immediate and severe. Over $30 billion in exports are at risk from hostile tariffs and external shocks,” the India SME Forum, representing over 100,000 small businesses, said in a letter to Cabinet Secretary T V Somanathan earlier this month.
A portal that never took off
The GMIS platform was first proposed in 2021-22 under the MSME Ministry’s International Cooperation (IC) Scheme. Developed in consultation with India Exim Bank, the portal was envisioned as a one-stop intelligence hub for MSMEs — offering insights into demand trends, pricing benchmarks, logistics costs, global tenders, trade regulations, and competitor landscapes.
Officially, the portal was to pool data from international institutions such as the World Bank and United Nations, alongside Indian sources, to create a simplified interface for smaller firms. But despite repeated announcements, the project has failed to go live.
This delay has left exporters without structured market intelligence at a time of intensifying global headwinds. Of the 6.6 million MSMEs in India, only 1.73 lakh currently export, underscoring the vast untapped potential that GMIS was meant to unlock.
Export vulnerabilities
Government data highlights both the promise and the fragility of MSME exports:
• Export growth: MSME exports surged from ₹3.95 lakh crore in FY21 to ₹12.39 lakh crore in FY25.
• Expanding exporter base: Exporting enterprises increased from 52,849 to 1,73,350 over the same period.
• Rising share: MSMEs now account for 45.8 per cent of India’s total exports, up from 43.6 per cent in FY23.
• Employment strength: MSMEs provide jobs to more than 110 million Indians and contribute around 30 per cent of GDP.
Despite this expansion, India’s export base remains narrow compared to its size, and highly vulnerable to external shocks. Industry bodies warn that without timely policy interventions, recent gains could be reversed.
Policy response — limited in scale
The Government has leaned on the International Cooperation Scheme, which reimburses costs for MSMEs participating in trade fairs and exhibitions abroad. In FY24, this scheme supported 545 MSMEs with an outlay of ₹19.22 crore — a figure experts say is modest given the scale of challenges.
The Union Budget 2025-26 unveiled an Export Promotion Mission to address non-tariff barriers, improve export credit access, and build global linkages for MSMEs. Separately, officials are considering a credit guarantee mechanism to provide relief to tariff-hit exporters.
Yet, industry leaders argue that these initiatives fall short without the backbone of a functioning GMIS. “Proportionately, as many as 32 million jobs could be exposed to tariff shocks. Already, 7.5-10 million jobs are at high risk of dollar-linked losses,” said Vinod Kumar, President of the India SME Forum, citing an Exim Bank study.
NITI Aayog roadmap
In March 2024, NITI Aayog laid out a roadmap recommending a single, AI-enabled information channel for exporters. This system would provide answers on tariffs, paperwork, financing, service providers, incentives, and potential customers. The GMIS, in its intended form, was expected to deliver precisely that.
But in its absence, exporters continue to rely on scattered trade data, fragmented consultancy networks, and word-of-mouth market intelligence. For many smaller firms, this gap translates into lost opportunities and rising compliance costs.
Industry’s message
Across India’s industrial belts — from Moradabad’s brassware hub to Tiruppur’s garment factories and Surat’s diamond units — the mood is increasingly anxious. “We can manage higher raw material costs, but not policy uncertainty. Without reliable intelligence, we are exporting blindfolded,” said a Moradabad-based exporter.
The India SME Forum has called for immediate operationalisation of GMIS, arguing that it could help firms pivot quickly to alternative markets, benchmark prices, and anticipate regulatory hurdles.
The bigger picture
The MSME sector has shown resilience, driving India’s exports past new milestones. But resilience alone may not be enough against external shocks of the current scale. The long-delayed GMIS has become more than a policy project — it is now viewed as a strategic necessity.
If implemented swiftly, the portal could empower small businesses with the tools to survive and expand in a volatile global economy. If delayed further, India risks seeing its most dynamic enterprises pushed to the margins of world trade.