From Local to Global: How Budget 2025–26 Unlocks Exports and E-commerce for MSMEs

The Union Budget 2025–26 signals a clear strategic shift in India’s export policy from scale-led growth to participation-led growth where MSMEs are positioned not just as suppliers to large exporters, but as direct exporters themselves. The budget recognises that future export expansion will increasingly come from smaller firms, digital channels, and faster logistics rather than traditional bulk trade alone. This is particularly evident in the strong emphasis on trade facilitation, customs reform, and targeted support for MSME exporters

One of the most consequential announcements for e-commerce exports is the removal of the ₹10 lakh per consignment cap on courier exports. This reform addresses a long-standing constraint faced by MSMEs and D2C brands exporting through digital platforms, where order values often exceeded courier limits but did not justify air cargo processes. By eliminating this cap, the budget enables seamless scaling for small exporters selling through global marketplaces, making cross-border e-commerce operationally simpler and commercially viable

Customs and logistics reforms further strengthen this push. The expansion of electronic sealing, factory-gate clearance for export cargo, and recognition of trusted exporters within the risk management system significantly reduce dwell time and compliance costs. Enhancements in the Authorised Economic Operator (AEO) framework, particularly extended duty deferral periods for Tier II and Tier III operators are especially relevant for MSMEs operating with tight working capital cycles. Together, these measures improve export predictability and reduce friction at borders, which is critical for time-sensitive e-commerce shipments

The budget also complements trade facilitation with financial and institutional support for MSMEs. The ₹10,000 crore SME Growth Fund and additional infusion into the Self-Reliant India Fund are aimed at enabling scale, technology adoption, and export readiness. More importantly, the mandatory use of TReDS for CPSE procurement, combined with credit guarantee support for invoice discounting, directly improves liquidity for MSME exporters. Linking GeM with TReDS further integrates public procurement, financing, and market access into a single ecosystem reducing payment delays that often deter MSMEs from export commitments

Sector-specific customs duty rationalisation also carries export relevance. Duty-free import extensions for inputs used in footwear, leather goods, seafood processing, electronics, and aerospace components enhance competitiveness in global value chains where MSMEs play a critical manufacturing role. The concessional domestic tariff area sale for eligible SEZ units provides additional flexibility, allowing export-oriented MSMEs to manage demand volatility without compromising viability

Taken together, Budget 2025–26 builds an export architecture that is faster, more digital, and MSME-centric. Rather than relying solely on incentives, it focuses on removing structural bottlenecks, logistics delays, working capital stress, and compliance friction that disproportionately affect small exporters. For MSMEs, especially those entering e-commerce exports, this budget lowers entry barriers, improves cash flow certainty, and aligns India’s trade systems with the realities of modern, platform-driven global commerce.