Guidelines for Trade Regulations, Accreditation and Compliance Enablement (TRACE) under Export Promotion Mission (EPM)

Government of India Ministry of Commerce & Industry Department of Commerce Directorate General of Foreign Trade Vanijya Bhawan, New Delhi

Trade Notice No. 26/2025-26 Dated: 20 February 2026

Subject: Launch of Trade Regulations, Accreditation & Compliance Enablement (TRACE) under Export Promotion Mission (EPM) – NIRYAT DISHA – reg.

The Support for Trade Regulations, Accreditation & Compliance Enablement (TRACE) under Export Promotion Mission (EPM) – NIRYAT DISHA is hereby implemented prospectively with immediate effect.

2. The intervention seeks to strengthen India’s quality and technical compliance ecosystem and to facilitate MSMEs (involved in international value chains) in meeting importing-country regulatory requirements.

3. Support under TRACE shall be limited to partial reimbursement of eligible expenditure incurred by MSMEs (involved in international value chains) towards testing, inspection, certification, audits, traceability systems, and other conformity-assessment requirements that are mandated vide regulations required for market access, or necessary to demonstrate compliance with internationally recognised standards.

4. The Policy framework is enclosed as Annexure-I. The Operational and Procedural Guidelines is enclosed at Annexure-II. The Governance Structure is enclosed at Annexure-III

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5. The intervention shall be operationalised on a pilot basis for feedback, institutional learning, and data-driven refinements. Online procedure for availing this support is enclosed at Annexure-IV

6. The guidelines are further submitted for stakeholder feedback in accordance with Paragraph 1.07A of the Foreign Trade Policy (FTP) 2023. Stakeholders may submit comments and suggestions on the Guidelines within 30 days from the date of issuance of this Trade Notice, through email at epm-dgft@gov.in

This is issued with the approval of the Competent Authority.

[Image omitted. See the official document.]

Bharani VLSVSS Deputy Director General of Foreign Trade

(Issued from F. No. 01/02/33/AM-26/EPM)

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ANNEXURE-I to the TRADE NOTICE

POLICY FRAMEWORK FOR TRADE REGULATIONS, ACCREDITATION & COMPLIANCE ENABLEMENT (TRACE)

1. Objective a. The objective of this initiative is to provide support to MSMEs to meet internationally recognised quality, safety, and technical requirements arising from compliance and quality related certificates and other mandatory or voluntary conformity-assessment requirements applicable in overseas markets.

b. Assistance under this initiative shall be directed towards enhancing the capacity of eligible MSME to demonstrate conformity with applicable standards, upgrade product quality, and comply with legitimate regulatory requirements of importing countries, without conferring any entitlement linked to export performance.

2. Scope and Coverage a. Support under this initiative shall be limited to partial reimbursement of eligible expenditure incurred by MSMEs involved in international value chains towards testing, inspection, certification, audits, traceability systems, and other conformity-assessment requirements that are mandated vide regulations required for market access, or necessary to demonstrate compliance with internationally recognised standards

b. The detailed operational and procedural guidelines framework including eligibility conditions, application and claim procedures, reporting and monitoring requirements, and verification mechanisms are prescribed under Annexure-II enclosed.

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ANNEXURE-II to the TRADE NOTICE

OPERATIONAL AND PROCEDURAL GUIDELINES FOR TRADE REGULATIONS, ACCREDITATION & COMPLIANCE ENABLEMENT (TRACE)

1. Eligible, Scope and Coverage a. All MSMEs involved in international value chains holding an active Importer–Exporter Code (IEC) (not listed in the Denied Entity List), and a valid MSME Udyam Registration Number shall be eligible for support under TRACE.

b. Support under this intervention shall be available for partial reimbursement of eligible expenditure incurred towards the following categories of costs, subject to the certifications, inspections, and conformity-assessment requirements being included in the positive lists notified under the relevant Annexures.

i. One-time costs, being certification-related prerequisites essential for market access, including inspections, audits, factory or facility assessments and market-specific licensing requirements.

ii. Recurring costs, being costs associated with ongoing export compliance, including certifications arising from quality and compliance related issues, specific health or safety certificates, and buyer mandated voluntary certifications.

c. The Positive List and Priority Positive List (as detailed in Annexure-V and Annexure - VI) of such testing, inspections, certifications etc. shall be dynamic and shall be periodically reviewed for inclusion or exclusion of certifications based on stakeholder consultations, monitoring of international standards notifications, and trade facilitation considerations.

d. Eligibility under this Intervention shall be prospective and shall apply only in respect of certifications, testing, inspections, or other eligible activities undertaken on or after 20th February 2026.

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2. Nature and Extent of Assistance a. Assistance shall be provided in the form of partial reimbursement of the actual cost (net of applicable taxes) or the notified cost, whichever is lower.

b. The level of assistance shall be uniform across all MSMEs (involved in international value chains), irrespective of classification as Micro, Small, or Medium enterprises. The maximum cumulative reimbursement admissible shall be ₹25 lakh per IEC per financial year.

c. Reimbursement rates shall be as follows: i. Positive List (Annexure-V): Up to 60% of the actual cost net of taxes, duties, cess etc or notified ceiling, whichever is lower. ii. Priority Positive List (Annexure-VI): Up to 75% of the cost net of taxes, duties, cess etc or notified ceiling, whichever is lower.

d. Merchant MSMEs (involved in international value chains) shall be eligible for support under TRACE only in respect of tariff lines notified under Annexure-VII, where exports are predominantly undertaken through aggregator-based models.

e. Given Support shall not be admissible in respect of deemed exports, as defined under Chapter 7 of the Foreign Trade Policy or for exports to Special Economic Zones (SEZ).

f. Revised reimbursement rates, as notified from time to time, shall be applicable only to testing and inspection certifications obtained on or after the date of such notification.

g. Reimbursement shall be admissible after the MSME has cleared and obtained the required testing, certification, or inspection outcome, and not merely upon completion of the process.

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h. Exporters graduating out of their existing MSME category during the financial year, due to an upward change in investment or turnover, shall continue to remain eligible for support for a period of three years from the date of such re-classification, in accordance with Ministry of MSME Notification S.O. 4926(E) dated 18.10.2022, and subject to fulfilment of all other prescribed conditions.

i. For FY 2025-26, the annual ceiling on support shall apply in full and shall not be subject to pro-rata adjustment.

3. Submission of Claims a. Eligible MSMEs (involved in international value chains) shall follow a two-stage online process for availing support under TRACE.

b. Stage I – Intent-to-Claim (IC): The eligible entity shall file an online Intent-to-Claim prior to obtaining certifications, test reports, and compliance documents.

c. Stage II – Reimbursement Claim (RC): After obtaining certifications, test reports, and compliance documents, the eligible entity shall file the Reimbursement Claim online, tagging the relevant IC(s) and enclosing: i. Copy of the certificate / inspection report / test report. ii. Invoice and proof of payment. iii. Evidence of mandatory or market-driven requirement.

d. A self-declaration confirming that no benefit has been claimed or shall be claimed for the same expenditure under any other scheme of the Central or State Government or any other third-party assistance.

e. The Intent-to-Claim shall be valid for Reimbursement Claim for a period of 2 years only.

4. Processing of Claims a. All valid claims shall be consolidated and submitted quarterly through the online system to the jurisdictional authority.

b. Disbursements shall be made directly to the bank account specified in the IEC.