Over the last five years, India’s engineering goods exports have demonstrated resilience and robust growth, reaching record highs despite global economic uncertainties and geopolitical tensions.
Export Performance (2020–2025):
- In fiscal year 2024-25, engineering goods exports reached an all-time high of USD 116.67 billion, registering a 6.74% year-on-year growth over the previous year’s USD 109.32 billion.
- This growth outpaced overall merchandise exports, which saw only a 0.08% increase in 2024-25, raising engineering’s share in total merchandise exports to 26.67% from 25.01% the previous year.
- Over the five-year period, engineering exports have hit all-time highs multiple times, reflecting the sector’s adaptability and competitiveness.
- The sector’s growth was particularly notable during a period marked by global uncertainty, including geopolitical disturbances and tariff escalations in major markets like the USA.
Monthly and Regional Trends:
- Monthly data for 2024-25 shows consistent growth, with April 2024 exports at USD 9.51 billion, up 11.28% from April 2023.
- Top export destinations include the USA, UAE, Singapore, Japan, and South Africa, with countries like the UAE (37.27% growth), Singapore (32.71%), and Japan (33.22%) showing substantial increases in demand for Indian engineering products.
- Regionally, North America remains the largest market, followed by the European Union and West Asia/North Africa (WANA). Sub-Saharan Africa, Latin America, and Oceania have also posted significant growth rates, indicating diversification of export markets.
Product Segments and Market Drivers:
- The growth in exports has been driven by high demand in sectors such as aircraft, spacecraft and parts, ships and boats, iron and steel, electrical machinery, and automobiles.
- In 2024-25, 26 out of 34 engineering panels showed positive year-on-year growth, especially in high-value categories like electric machinery and vehicles.
- However, some segments such as non-ferrous metals (aluminum, zinc, lead, tin) and certain machinery panels experienced declines, reflecting shifting global demand and commodity price volatility.
Government Support and Export Promotion:
- The Indian government has implemented several export promotion schemes to support engineering exports, including the Remission of Duties and Taxes on Exported Products (RoDTEP), Export Promotion Capital Goods (EPCG) Scheme, and Trade Infrastructure for Export Scheme (TIES).
- These schemes aim to improve competitiveness, facilitate access to advanced technology, and develop export infrastructure, contributing to the sector’s sustained growth.
Challenges:
- Despite overall growth, the sector faced challenges from geopolitical tensions (notably in the Middle East and West Asia), policy uncertainty in key markets like the US, and rising protectionism.
- Fluctuations in commodity prices and global supply chain disruptions have also impacted specific export segments.
Export of engineering goods from India has shown consistent growth over the past decade, reaching record highs in recent years. In fiscal year 2024-25, engineering goods exports hit an all-time high of USD 116.67 billion, registering a year-on-year growth of 6.74% over the previous year, when exports were USD 109.30 billion. The sector outperformed overall merchandise exports, which grew by only 0.08% in the same period.
CAGR (Compound Annual Growth Rate) of Engineering Goods Exports (2013-14 to 2024-25):
To calculate the CAGR for engineering goods exports from India over the last 11 years (from FY 2013-14 to FY 2024-25):
The CAGR formula is:CAGR=(Ending ValueBeginning Value)1n−1CAGR=(Beginning ValueEnding Value)n1−1
Plugging in the values:CAGR=(116.6762.26)111−1≈(1.874)0.0909−1≈1.059−1=0.059 or 5.9%CAGR=(62.26116.67)111−1≈(1.874)0.0909−1≈1.059−1=0.059 or 5.9%
Key points:
- Engineering goods exports have nearly doubled in the last 11 years, from USD 62.26 billion in 2013-14 to USD 116.67 billion in 2024-25.
- The CAGR for engineering goods exports from India over this period is approximately 5.9%.
- The US remains the top destination, with significant growth also seen in the UAE, Singapore, Nepal, Japan, and France.
- Major export segments include electrical machinery, nuclear reactors and boilers, vehicles (excluding railways), iron and steel, and aluminum products.
This sustained growth highlights the increasing global competitiveness and diversification of India’s engineering goods sector.
Conclusion:
India’s engineering goods exports have shown remarkable growth and resilience over the last five years, consistently achieving new highs and expanding into new markets. This performance underscores the sector’s importance to the Indian economy and its growing role in global manufacturing and supply chains.