Government of India is currently focusing on becoming prime player in world trade by 2020. The commerce department has made it clear that the exports are expected to reach US$450-billion (bn) in the span of next three years from estimated US $225 bn in 2010-11. This is good news for the export industry that comprises of several MSMEs.

Formulation of effective commercial policy for international trade will help to achieve this goal. The foreign trade policy for 2009-14 has been announced already. The policy includes reduction in export transaction costs, reimbursement of indirect taxes and a visible improvement in export infrastructural facilities. In this current fiscal, India has registered a rise in exports of US $184.6 bn that amounts to 29.4%. This happened in a span of 10 months.

However, some labor intensive sectors have witnessed a slump and this includes textile and apparel. So, to help reverse the slowdown, a tax holiday has been called by Garments Exporters Association (GEA) in the recent budget of 2011-12. Exporters are also demanding for GST (Goods and Service Tax), standardization of VAT rates and availability of adequate funds with less than 7 percent interest rate.