The new regulations scheduled to take effect later this year, flagging multiple operational challenges that they believe could disrupt trade and tighten liquidity at a time when global demand remains uncertain.

A key issue highlighted by the Federation of Indian Export Organizations (FIEO) relates to the availability of export credit. Industry data presented to the RBI showed that priority sector export credit had contracted 14% by February even as the country's combined goods and services exports registered nearly 4% growth during the same period.

Exporters argued that the decline in credit availability has become a major constraint for businesses, particularly small and medium enterprises grappling with liquidity pressures.