India will attempt to replicate U.Ok. offers pro-MSME options in future commerce offers

Indian negotiators try to make sure future commerce agreements, akin to these with the U.S. and the EU, embrace comparable carved-out options to profit Indian micro, small, and medium enterprises (MSMEs) alongside the strains of what was included within the just lately signed settlement with the U.Ok., in accordance with Commerce Ministry officers.

“The main objective is to reinforce cooperation and knowledge sharing to enhance the power of MSMEs to take part in bilateral commerce and funding,” an official within the Ministry of Commerce and Industry advised The Hindu on the situation of anonymity as negotiations for a commerce take care of the U.S. and the EU are nonetheless ongoing. 

The Comprehensive Economic and Trade Agreement (CETA) between India and the U.Ok., signed final week, included a particular devoted chapter on SMEs, which India had argued for, the official defined. 

Among the important thing options included within the India-U.Ok. CETA that MSMEs stand to profit is the availability for the institution of an MSME contact level in each nations, the sharing of knowledge on rules, certifications and market alternatives, and provisions for cooperation on commerce promotion actions, together with exhibitions and business-to-business (B2B) occasions.

When it involves public procurement, U.Ok. suppliers seeking to bid for Indian authorities contracts will probably be handled as  ‘Class-II native suppliers’ in home tenders above agreed thresholds, whereas Indian suppliers, together with MSMEs, will proceed to obtain preferential remedy as ‘Class-I native suppliers’. 

“India is attempting to incorporate such carve-outs for MSMEs in ongoing commerce deal discussions as properly, as safeguarding our MSMEs is a precedence,” the official stated.

The CETA additionally features a mechanism for addressing non-tariff boundaries that disproportionately have an effect on MSMEs. 

“The labour-intensive sectors which were the main focus in CETA are textiles, footwear, leather-based merchandise, marine merchandise, toys, sports activities items, and gems and jewelry,” Rumki Majumdar, Economist at Deloitte India, defined. “These sectors aren’t solely labour-intensive but additionally have an enormous contribution from the MSME sector.” 

According to Ms. Majumdar, the export share of those sectors was 24.6% in 2024-25, down from 30.4% in 2018-19. 

“Therefore, free entry to the U.Ok. market will give an enormous thrust to those sectors, which in flip can have a multiplier impact on jobs and revenue in addition to throughout rural and semi-urban MSME sectors,” she added.

The CETA additionally encourages technical cooperation to reinforce MSME capabilities, the setup of workshops and coaching packages on requirements, sustainability, and export readiness, and joint efforts by the 2 nations to advertise women-owned and rural MSMEs.