As per the source, the Ministry is working with other Ministries to ensure measures beyond credit guarantee schemes for the tariff-hit sector are implemented at the earliest. The Government will soon be coming up with a few measures to handhold the small and medium enterprises in the sectors like textiles, apparels, carpets, which are the worst hit by the US tariff, confirmed a source from the Ministry of Micro, Small & Medium Enterprises (MSME).
“The Government will soon come up with 4-5 measures to help those MSMEs, which are worst hit by the US tariff. We are working on that,” said the official, who doesn’t wish to be named. He said that there is a concern of piling up of non-performing assets and unemployment in these sectors, thus, the Government is planning to take possible measures. The US administration imposed a total tariff of 50% on the Indian exports from the sectors like textiles, apparels, carpets, gems, jewelry and seafood industries from August end.
The Ministry of Finance had also said that they will be drafting a new credit support scheme to help tariff hit MSMEs. The scheme is likely to be rolled out at the earliest. The proposed measure seeks to cushion exporters from losses arising due to reduced competitiveness in the US market while enabling them to explore new geographies. The Ministry is yet to finalize the amount that could be availed by the MSMEs under this scheme, but a source from the Finance Ministry confirmed, “Discussions are going on and a huge amount will be made available for credit for the MSMEs.”
MSMEs have been dealing with a capital crunch due to delayed payment and with a credit exposure of nearly Rs.40 lakh crores, there is a growing concern of further capital crunch that may eventually lead to NPAs too. As an impact of the US tariff, gross NPAs in the banking system’s MSME portfolio are expected to go up to around 3.9% by the end of FY26, from 3.59% in FY25, according to Crisil Ratings. MSME loans currently account for about 17% of the total outstanding credit in the banking system, the agency noted.
For textiles and apparel, one of the worst hit sectors with a major involvement of the MSMEs, the exports have gone down by more than 10% in September 2025 as compared to the same month in the previous year. Similarly, for shrimp’s exports, while data of country-specific exports for September are yet to be officially revealed, decline in marine products exports to the US, which had 35% share, is expected to pull down overall shipment in FY26, exporters said.
Source : https://www.newindianexpress.com/business/2025/Oct/28/govt-to-soon-come-up-with-new-measures-for-tariff-hit-msme-sectors
