Last Updated: October 27, 2026 by Pratham Agarwal, Rasp International
The short answer
TRACE (Trade Regulations, Accreditation and Compliance Enablement) pays a Micro, Small or Medium Enterprise (MSME) exporter back part of what it spends on testing, inspection, certification and audits for overseas markets. Under Directorate General of Foreign Trade (DGFT) Trade Notice No. 09/2026-27 dated 1 July 2026, micro and small units may get up to 95 percent and medium units up to 80 percent of the cost net of taxes, within Rs 50 lakh per Importer Exporter Code (IEC) a year.
The rule that decides everything: file the Intent to Claim before the certificate or test report is obtained, as Annexure II para 3(b) of Trade Notice No. 26/2025-26 dated 20 February 2026 requires.
Verified as on 27 October 2026 against DGFT Trade Notices No. 26/2025-26 dated 20 February 2026 and No. 09/2026-27 dated 1 July 2026, the DGFT Intent Claim Form User Guide v1.1, the DGFT TRACE FAQ Manual and DGFT trade notices up to No. 32/2026-27 dated 26 October 2026. Written by Pratham Agarwal, Founder, Rasp International.
95%
top rate for micro and small units, Trade Notice 09/2026-27 para 2(b)
Rs 50 lakh
yearly cap per IEC, Trade Notice 09/2026-27 para 2(b)
462
eligible entries in Annexure I, Trade Notice 09/2026-27
2 years
life of an Intent to Claim, Trade Notice 26/2025-26 Annexure II para 3(e)
| Scheme | Trade Regulations, Accreditation and Compliance Enablement (TRACE) |
|---|
| Part of | Niryat Disha, the non-financial sub-scheme of the Export Promotion Mission (EPM) |
|---|
| Run by | EPM Section, DGFT Headquarters |
|---|
| Legal basis | Trade Notice No. 26/2025-26, amended by Trade Notice No. 09/2026-27 |
|---|
| Who it is for | MSMEs with an active IEC and a valid Udyam Registration Number |
|---|
| What you get | Up to 95 percent (micro and small) or 80 percent (medium) of cost net of taxes |
|---|
| Cap | Rs 50 lakh per IEC per financial year |
|---|
| Validity or window | Intent to Claim valid 2 years; export proof due within 2 years of the first instalment |
|---|
| Where you apply | Trade Connect ePlatform (trade.gov.in), DGFT User Guide v1.1 |
|---|
Why this page exists
The Press Information Bureau (PIB) explainer of 24 February 2026 gives TRACE at 60 and 75 percent with a Rs 25 lakh cap. Trade Notice No. 09/2026-27 dated 1 July 2026 replaced those figures and tied half the payment to exports, so advice copied from February is now wrong.
This page gives each current rule with its paragraph. A paragraph number with no document named is from Annexure II of Trade Notice No. 26/2025-26, as amended. Rasp International is an ISO 9001:2015 certified export and import (EXIM) and DGFT advisory firm founded in 2019 that has served 500 plus exporters.
What TRACE is
TRACE is a reimbursement scheme that pays back part of the conformity assessment cost (the testing, inspection, certification and audits a foreign buyer or regulator demands) for MSME exporters, run by the EPM Section of DGFT under the Niryat Disha sub-scheme of the Export Promotion Mission. Niryat Disha is the mission’s non-financial arm and Niryat Protsahan its trade finance arm, as the PIB explainer sets out.
Paragraph 5 of Trade Notice No. 26/2025-26 runs TRACE as a pilot, so the rules can change. Background is in our TRACE scheme explainer and Export Promotion Mission guide.
What you get
| Item | What TRACE pays or does not pay | Source |
|---|
| Micro and small | Up to 95 percent of cost net of taxes, duties and cess, or the notified ceiling if lower | Trade Notice 09/2026-27, para 2(b)(i) |
| Medium | Up to 80 percent on the same basis | Para 2(b)(ii) |
| Yearly cap | Rs 50 lakh per IEC; more only case by case through the Sub-Committee | Para 2(b) |
| Payment | Half after the certificate, half after linked exports | Para 2(c) |
| Costs covered | Inspections, audits, factory assessments, market licensing and recurring compliance certificates | Trade Notice 26/2025-26, Annexure II para 1(b) |
| Consignment certificates | One claim per consignment, each with its own certificate | DGFT TRACE FAQ Manual, Q16 |
| Not paid | Goods and Services Tax (GST) and other taxes, unlisted certificates, work before 20 February 2026 and failed tests | Annexure II paras 1(b), 1(d), 2(a) and 2(g) |
Illustrative example. A small unit pays Rs 2,00,000 plus GST for a listed certificate. TRACE may pay up to Rs 1,90,000, in two parts of Rs 95,000; a medium unit up to Rs 1,60,000. Every figure is subject to approval.
Watch the certificate date: under Annexure II para 2(f), the 95 and 80 percent rates apply only to certificates obtained on or after 1 July 2026.
Which certificates and agencies count
Annexure I to Trade Notice No. 09/2026-27 replaced the old Positive and Priority Positive Lists with one list of 462 entries, each naming a country, a certificate and the products covered. Examples are ISO 9001 (entry 436), the United States Food and Drug Administration (FDA) (entry 447), CE marking (entry 448) and HACCP (Hazard Analysis and Critical Control Points) (entry 450).
No list of approved agencies or labs is notified. The DGFT TRACE FAQ Manual, Q14, ties eligibility to the certificate name, provided the export country and product match the entry. Picking “Others” on the form (DGFT User Guide v1.1, page 10) does not make a cost payable under Annexure II para 1(b).
Who can apply and who cannot
Who can apply
Manufacturer MSMEs
Any listed certificate, with an active IEC not on the Denied Entity List and a valid Udyam Registration Number (Annexure II para 1(a)).
Merchant MSMEs on listed lines
Only for the six-digit lines in Annexure VII (para 2(d)), matched to your ITC-HS code (the Indian tariff code).
Units outgrowing their category
Eligible for three years from re-classification (para 2(h), citing Ministry of MSME Notification S.O. 4926(E) dated 18 October 2022).
Units with a clean record
Not under investigation, debarred or blacklisted under the trade laws named in the Annexure IV declaration.
The FAQ Manual, Q2 and Q17, says “Annexure-IV” for merchants, but that is the application form; the tariff lines are in Annexure VII, which Trade Notice No. 09/2026-27 keeps.
Who cannot apply
- A unit without a valid Udyam number, or with an IEC on the Denied Entity List (para 1(a)).
- Deemed exports under Chapter 7 of the Foreign Trade Policy, and exports to a Special Economic Zone (SEZ) (para 2(e)).
- A merchant exporter whose tariff line is not in Annexure VII (para 2(d)).
- Work done before 20 February 2026 (para 1(d)).
- A unit whose earlier Intent to Claim lapsed, for the next financial year (para 5(a)).
- Any cost claimed or applied for under another central or state scheme (para 3(d)).
Documents that get it through
| Document | What the authority checks | The mismatch that brings a query or rejection |
|---|
| IEC profile | Active IEC; money goes only to the bank account in the IEC (Annexure II para 4(b)) | An old or closed bank account in the IEC record |
| Udyam Registration | The MSME type that sets 95 or 80 percent (Trade Notice 09/2026-27, para 2(b)); the form copies it from the IEC (Annexure IV, Part A) | A small unit shown as medium, which puts the claim on 80 percent |
| Intent to Claim acknowledgement | Filed before the certificate (para 3(b)), with certificate, agency, country and amounts (User Guide v1.1, page 9) | An Intent dated after the certificate, or a country that does not match the Annexure I entry (FAQ Manual, Q14) |
| Certificate or test report | A cleared outcome, not just a finished process (para 2(g)); the first enclosure of the first Reimbursement Claim, RC-1 (Trade Notice 09/2026-27, para 3(c)) | A failed test, or an audit that does not grant the certificate |
| Invoice and proof of payment | The fee paid; the amount exclusive of taxes sets the refund (User Guide v1.1, page 9) | GST left inside the amount entered as exclusive of taxes |
| Evidence of the requirement | Proof the certificate was mandatory or market driven (para 3(c)) | No buyer letter or importing country rule on file |
| Shipping bill and e-BRC | For RC-2 (the second claim), linked exports and realisation; FAQ Manual Q8 names the shipping bill and electronic Bank Realisation Certificate (e-BRC) | Another product shipped, a shipment to an SEZ unit or payment not yet realised |
How to apply, stage by stage
Before you apply
1
Check the IEC and Udyam records
Confirm the IEC is active, shows the right MSME type (Annexure IV, Part A) and is linked to your login email on the DGFT customer portal (User Guide v1.1, page 4).
2
Match the certificate to Annexure I
Find the exact certificate, country and product in Annexure I. Merchant exporters also check Annexure VII.
3
Register and set up signing
Register on trade.gov.in, then register a digital signature token or Aadhaar e-sign under My Dashboard (User Guide v1.1, pages 3 to 5).
Filing
4
File the Intent to Claim first
Open My Dashboard, then TRACE, then Apply for Intent. Enter the certificate, agency, country of export and amounts with and without taxes, then sign and submit (User Guide v1.1, pages 7 to 12).
5
File RC-1 after the certificate
Tag the Intent and upload the certificate, invoice, payment proof and requirement evidence for the first 50 percent (Trade Notice No. 09/2026-27, paras 2(c) and 3(c)).
6
File RC-2 after linked exports
Upload the shipping bill and e-BRC for exports linked to the certificate (FAQ Manual, Q8) to claim the other 50 percent.
After filing
7
Track the claim and log any errors
Valid claims are consolidated quarterly, paid into the IEC bank account and checked after payment (paras 4 and 5(b)). For a portal error, raise a Service Request with screenshots and email trace.epm-dgft@gov.in (FAQ Manual, Q18).
Two clocks, two years each: under Annexure II para 5(a), an Intent to Claim with no reimbursement application inside 2 years lapses, and the applicant cannot claim in the next financial year. Trade Notice No. 09/2026-27 adds that export proof is due within 2 years of the first instalment, or the second lapses and the first may be recovered.
Reports generated or validated through the Bharat Aayat Niryat Lab / Quality Setu platform (Lab Setu pilot, Trade Notice No. 14/2025-26 dated 27 October 2025) may be prioritised for automated processing under Annexure II para 4(c). Screen by screen help is in our TRACE filing guide.
Certificate booked but no Intent to Claim filed yet
Send us the certificate name, the export market and your MSME type. We check it against Annexure I and the filing order, and we tell you plainly if TRACE will not pay.
Where claims go wrong
These patterns come from the notices and the FAQ Manual, not client cases.
| Failure | What you see | What actually broke |
|---|
| Certificate issued before the Intent | No valid Intent to tag at RC-1 | Para 3(b) puts the Intent before the certificate is obtained |
| Certificate entered as “Others” | The Intent goes in, but the cost is not payable | Para 1(b) pays only for listed certificates |
| Merchant exporter outside Annexure VII | Claim not admissible for that product | Para 2(d) limits merchants to Annexure VII lines |
| Wrong MSME type in the IEC | 80 percent where 95 was expected | Annexure IV Part A copies the IEC type; para 2(b) sets the rate by type |
| Linked export sent to an SEZ unit | RC-2 evidence not accepted | Para 2(e) excludes SEZ exports and deemed exports |
| One consignment certificate used twice | The second claim is refused | FAQ Manual, Q16: each claim needs its own certificate |
How it fits with other schemes
One rule governs every combination: Annexure II para 3(d) bars claiming the same expenditure under any other central or state scheme.
| Scheme | What it pays for | Use with TRACE |
|---|
| Uttar Pradesh Marketing Development Assistance (UP MDA), Government Order 811/18-4-2025 dated 6 November 2025, category 9 | 75 percent of the actual cost of quality control certification for Uttar Pradesh MSME exporters | One scheme per certificate cost (Government Order 811 paragraph 8 has a matching bar); see our TRACE or UP MDA guide |
| Market Access Initiative (MAI) compliance claims on Export Promotion Council (EPC) portals | The earlier route for compliance costs | Discontinued; file under TRACE now, as old MAI files are not migrated (FAQ Manual, Q10 and Q11) |
| Market Access Support (MAS), Trade Notice No. 19/2025-26 dated 31 December 2025 | Buyer seller meets, trade fairs and exhibitions | A different cost, so both can run; see our Market Access Support page |
| Interest subvention under Niryat Protsahan | Part of the interest on export credit | A different cost; see our interest subvention page |
What TRACE will not do
1
It will not pay before you spend
TRACE pays after the outcome (para 2(g)), and half only after linked exports (para 2(c)). You fund the certificate first.
2
It will not pay for an unlisted certificate
A certificate outside Annexure I earns nothing until the Sub-Committee adds it (Annexure II para 1(b) and 1(c)).
3
It will not promise a payment date
DGFT examines and approves each claim (Annexure IV, item e). Claims move in quarterly batches, and no processing time is printed (para 4(a)).
How Rasp International handles TRACE
When a unit engages us, we prepare and file the Intent to Claim, RC-1 and RC-2 end to end, always in the unit’s own name. Units that prefer to file themselves can do so with our guidance. We sign a non-disclosure agreement (NDA) and a service level agreement (SLA) with every client.
The client and we both hold the Trade Connect login, kept safe and confidential, and documents stay in encrypted storage. We give an authority letter only on request. We hold no customs broker (CHA) licence; licensed CHA partners across India clear customs. Read how we work or see our product certification support.
What Is Not Yet Notified, Checked on 27 October 2026
- Full cost support. Press reports of 23 October 2026 quote the Commerce and Industry Minister offering to bear the entire cost of expensive certifications for micro and small units. No trade notice up to No. 32/2026-27 dated 26 October 2026 changes the rates. Check with the EPM Section of DGFT before you budget on it.
- The per-certificate “notified ceiling” (Annexure I prints no amounts) and what counts as “exports linked” for RC-2. Check with the EPM Section of DGFT.
- Whether renewals and surveillance audits count as recurring costs under para 1(b)(ii). Check with the EPM Section of DGFT.
- Whether an Intent to Claim can be amended or withdrawn. Check with the EPM Section of DGFT.
- Annexure I entries tagged “India”, such as BIS (Bureau of Indian Standards), and how the form filters them; see our TRACE post for shipyards. Check with the EPM Section of DGFT.
Planning a certificate for a new export market
Tell us the certificate, the market and your MSME type. We tell you what TRACE may pay and what has to be filed first.
Frequently asked questions
What is the TRACE scheme?
TRACE, or Trade Regulations, Accreditation and Compliance Enablement, is a DGFT scheme under Niryat Disha of the Export Promotion Mission. Launched by Trade Notice No. 26/2025-26 dated 20 February 2026, it repays MSME exporters part of their testing, certification and audit costs, subject to approval.
How much does TRACE pay micro, small and medium exporters?
Trade Notice No. 09/2026-27 dated 1 July 2026 gives micro and small enterprises up to 95 percent and medium enterprises up to 80 percent of cost net of taxes, or the notified ceiling if lower. Support is capped at Rs 50 lakh per IEC per financial year.
Who is eligible for the TRACE scheme?
An MSME with an active IEC not on the Denied Entity List and a valid Udyam Registration Number, under Annexure II para 1(a) of Trade Notice No. 26/2025-26. Merchant exporters qualify only on Annexure VII tariff lines. Deemed exports and SEZ exports are excluded.
Can a merchant exporter claim TRACE?
Yes, but only for products whose six-digit tariff line is in Annexure VII to Trade Notice No. 26/2025-26 (Annexure II para 2(d)). The merchant enters its ITC-HS code in Part A of the Intent to Claim. Manufacturer exporters face no such tariff line limit.
When should I file the TRACE Intent to Claim?
Before you obtain the certificate, test report or compliance document, as Annexure II para 3(b) of Trade Notice No. 26/2025-26 requires. The safe practice is to file before you sign with the lab, so a report issued early cannot fall outside the rule.
Which certificates are covered under TRACE?
Only those in Annexure I to Trade Notice No. 09/2026-27, a list of 462 entries such as ISO 9001, US FDA, CE marking and HACCP. The FAQ Manual, Q14, adds that your export country and exported product must match the details shown against that entry.
What documents are needed for TRACE RC-1 and RC-2?
RC-1 needs the certificate or report, the invoice with payment proof and evidence that the requirement was mandatory or market driven (Trade Notice No. 09/2026-27, para 3(c)). RC-2 needs proof of linked exports and realisation: the shipping bill and e-BRC (FAQ Manual, Q8).
What happens if I miss a TRACE deadline?
Under Trade Notice No. 26/2025-26, an Intent to Claim with no claim within 2 years lapses and bars claims for the next financial year (para 5(a)). Under Trade Notice No. 09/2026-27, if linked export proof is not filed within 2 years of the first instalment, the second lapses and the first may be recovered.
Can I claim TRACE and a state certification subsidy together?
Not for the same cost. Annexure II para 3(d) of Trade Notice No. 26/2025-26 requires a declaration that the same expenditure is not claimed under any central or state scheme. Uttar Pradesh MDA has a matching bar in para 8 of Government Order 811/18-4-2025.
Do I need a consultant to apply for TRACE?
No. Any eligible MSME can register on the Trade Connect ePlatform and file its own Intent to Claim, RC-1 and RC-2, signing with a digital signature or Aadhaar e-sign (User Guide v1.1, page 5). What matters most is filing the Intent before the certificate.
What happens if my TRACE claim is rejected?
The trade notices print no appeal route. The FAQ Manual, Q22, sends unresolved queries to your Export Promotion Council, then to trace.epm-dgft@gov.in with the IEC, application number and screenshots. Act inside your two year windows, because a lapse under para 5(a) is automatic.
Sources
- Tier 1. DGFT Trade Notice No. 26/2025-26 dated 20 February 2026, TRACE guidelines with Annexures I to VII: content.dgft.gov.in.
- Tier 1. DGFT Trade Notice No. 09/2026-27 dated 1 July 2026, TRACE amendments with Annexure I: content.dgft.gov.in.
- Tier 1. DGFT User Guide for Intent Claim Form v1.1, January 2026: content.trade.gov.in.
- Tier 1. DGFT TRACE / EPM FAQ Manual, undated. Verified against the official PDF; no public URL found.
- Tier 1. DGFT TRACE page: dgft.gov.in; Trade Connect EPM page: trade.gov.in.
- Tier 1. DGFT Trade Notices No. 14/2025-26, No. 19/2025-26 and the list up to No. 32/2026-27 dated 26 October 2026: DGFT trade notices.
- Tier 1. PIB explainer, 24 February 2026: pib.gov.in.
- Tier 1. Government Order 811/18-4-2025 dated 6 November 2025, Government of Uttar Pradesh, in Hindi: UPEPC government orders page.
This is general guidance. Rules change. Check the current notification or trade notice, or speak to us, before you act.
Related: Export incentives in India | Interest subvention on export credit | Credit for e-commerce exporters