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May 2025
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India's engineering exports conceded a marginal 0.82% year-on-year decline in May 2025 due to higher statistical base

Despite achieving a record high figure in 2024-25, Indian engineering exports declined on a monthly basis in March 2025. Engineering exports in March 2025 was recorded at USD 10.82 billion as against USD 11.27 billion in March 2024, registering a decline of 3.92 percent year-on-year.
According to the Quick Estimates of Department of Commerce, Government of India, share of engineering in India's total merchandise exports increased to 25.79 percent in March 2025 from 24.61 percent in February 2025. On a cumulative basis, the share was recorded at 26.67 percent during entire fiscal 2024-25 as against 25.01 percent in the previous fiscal.
In March 2025, 27 out of 34 engineering panels witnessed positive year-on-year growth. While 13 engineering panels including mainly Iron and Steel and products, Copper, and products, Aircrafts and Spacecrafts, Ship and Boats, Cranes, Lifts Winches, Other Construction Machinery etc witness decline in exports during March 2025 vis-à-vis March 2024.
On a cumulative basis, 28 out of 34 engineering panels recorded positive growth and remaining 6 engineering panels including Iron and Steel, some Non-ferrous sectors including Copper and Aluminium products, Office Equipment, Other Construction Machinery and Mica Products recorded negative growth during April-March 2024-25.
Region wise, North America maintained its spot as the number one export destination with a share of 20.5% followed by EU (17.1%) and WANA (16.7%) in March 2025. Significant export growth was noted in LAC (20.1%), Other Europe (19%) and NE Asia (14.1%), in March 2025. In cumulative terms, all regions experienced growth barring Oceania (-10.4%) and EU (-1.9%).
Country-wise, USA remained the top destinations followed by UAE and Saudi Arabia in March 2025 while maximum increase was noted in France (43.2%), Nepal (37 %) and UK (32.9%).
In cumulative terms too USA remained the number one destination. Significant export growth was noted in UAE, Sinagpore, Nepal, Japan and France.
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May-2025 engineering exports hit peak growth for fiscal 2024-2025

  • Engineering exports from India once again reached its all-time high at USD 116.67 billion in fiscal 2024-25 surpassing the previous high of USD 112.10 billion achieved in fiscal 2021-22.
  • Engineering exports from India saw its all-time high five times in the last eleven fiscals.
  • During 2024-25, engineering exports registered 6.74 percent year-on-year growth on its way to reach this record high. Exports were recorded at USD 109.30 billion in 2023-24.
  • It is mention worthy in this regard that engineering exports outweighed the broader Merchandise Exports in terms of growth as India’s Merchandise exports saw a meagre 0.08 percent year-on-year growth in 2024-25 to reach USD 437.42 billion.
  • As a consequence, share of engineering in India’s overall merchandise exports increased to 26.67 percent in 2024-25 from 25.01 percent in the previous fiscal.
  • The performance of Indian engineering exports was really remarkable in 2024-25 as it came during a period of extreme global uncertainty following geo-political disturbances and economic slowdown in major developed and emerging nations, which was further aggravated by tariff escalation by the USA.
Trade Flow Export figures(in $ billion) Growth (%)
Mar-2024 Mar-2025 Apr-Mar 2023-24 Apr-Mar 2024-25 Mar-2025 over Mar-2024 Apr-Mar 2023-24 over Apr-Mar 2024-25
Engineering exports 9.97 9.89 18.52 19.40 -0.82% 4.77%
Overall merchandise exports 39.59 38.73 74.89 77.19 -2.17% 3.07%
Share of engineering (%) 25.18% 25.53% 24.72% 25.13% --- ---
Service Exports 29.61 32.39 59.79 65.24 9.39% 9.12%

Source : Compiled from data by DGCI&S and Quick Estimates published by the Government of India.

Engineering Exports: Monthly Trend

The monthly engineering figures for 2024-25 vis-à-vis 2023-24 are shown below as per the latest DGCI&S estimates:

Table 1: Engineering Exports: Monthly Trend in 2024-25

US$ million

Month 2023-24 2024-25 Growth (%)
April 8547.61 9511.56 11.28
May 9968.45 9887.01 -0.82
April - May 18516.06 19398.58 4.77

Source : DGCIS, Govt. of India

TOP 25 ENGINEERING EXPORT DESTINATIONS IN April-May 2024-25

We now look at the export scenario of the top 25 nations that had highest demand for Indian engineering products during March 2025 over March 2024 as well as in cumulative terms during April-March 2024-25 vis-à-vis April-March 2023-24. The data clearly shows that top 25 countries contribute 73.3% of total engineering exports.

Table 2: Engineering exports country wise

(US$ million)

Countries Mar-2024 Mar-2025 Growth (%) April-May 2023-24 April-May 2024-25 Growth (%)
U S A 1659.09 1735.42 4.6% 3077.07 3396.85 10.39%
U ARAB EMTS 811.2 683.38 -15.76% 1203.73 1222.2 1.53%
GERMANY 353.21 429.39 21.57% 677.12 762.63 12.63%
U K 349.59 388.34 11.09% 650.57 723.64 11.23%
SINGAPORE 283.74 366.5 29.17% 659.37 865 31.19%
SAUDI ARAB 587.01 337.11 -42.57% 1022.76 731.55 -28.47%
MEXICO 317.92 281.76 -11.37% 614.37 525.71 -14.43%
ITALY 253.97 274.69 8.16% 563.75 542.99 -3.68%
NEPAL 174.41 226.94 30.12% 346.16 434.51 25.52%
KOREA RP 202.58 219.44 8.32% 411.91 473.2 14.88%
NETHERLAND 141.78 217.95 53.72% 279.53 370.67 32.6%
BRAZIL 199.87 216.08 8.11% 365.44 427.74 17.05%
JAPAN 197.66 215.07 8.81% 371.32 446.4 20.22%
CHINA P RP 218.59 207.36 -5.14% 429.04 373.03 -13.06%
THAILAND 164.59 191.6 16.41% 317.18 350.34 10.46%
FRANCE 153.29 190.77 24.45% 306.18 351.66 14.85%
SOUTH AFRICA 165.47 190.01 14.83% 296.15 387.68 30.91%
BANGLADESH PR 179.96 185.84 3.27% 328.14 352.36 7.38%
TURKEY 457.51 176.28 -61.47% 676.71 368.81 -45.5%
INDONESIA 153.46 173.36 12.97% 272.25 294.43 8.15%
BELGIUM 93.74 144.68 54.34% 241.58 290.39 20.21%
AUSTRALIA 103.11 131.25 27.29% 195.96 262.77 34.1%
SPAIN 115.58 117.28 1.47% 212.8 244.18 14.74%
VIETNAM SOC REP 130.26 116.51 -10.56% 246.72 233.91 -5.19%
CANADA 100.5 112.32 11.76% 211.95 212.42 0.23%
Total engineering exports to top 25 countries 7568.09 7529.31 -0.51% 13977.74 14645.05 4.77%
Total engineering exports 9968.45 9887.01 -0.82% 18516.06 19398.58 4.77%

Source : DGCI&S

REGION WISE INDIA’S ENGINEERING EXPORTS

The following table depicts region wise India’s engineering exports for 2024-25 as compared to 2023-24.

Table 3: Region wise engineering exports in April-February 2023-2024 vis-à-vis April-May 2023-2024

(US$ million)

Regions Mar-2024 Mar-2025 Growth (%) April-May 2023-24 April-May 2024-25 Growth (%)
NORTH AMERICA 2077.51 2129.5 2.5% 3903.39 4134.97 5.93%
EUROPEAN UNION 1561.55 1779.67 13.97% 3158.62 3435.5 8.77%
WANA 1904.2 1427.85 -25.02% 3045.03 2770.35 -9.02%
ASEAN 929.75 1011.86 8.83% 1951.1 2166.1 11.02%
SSA( Sub Saharan Africa) 616.78 765.34 24.09% 1139.11 1452.94 27.55%
N E ASIA 712.78 747.07 4.81% 1383.83 1496.61 8.15%
OTHER EUROPE 869.44 602.78 -30.67% 1448.84 1177.13 -18.75%
LATIN AMERICA 550.77 594.02 7.85% 995.45 1160.01 16.53%
SOUTH ASIA 499.21 549.32 10.04% 975.95 1053.28 7.92%
OCEANIA 114.57 145.31 26.83% 220.07 288.63 31.16%
CIS 130.54 125.29 -4.03% 292.5 243.42 -16.78%
OTHERS 1.36 1.66 22.17% 2.14 12.3 474.23%

Note : *Figures have been rounded off.

Source : DGCI&S **Myanmar has been included in ASEAN and not in South Asia, since ASEAN is a formal economic grouping.

PRODUCT PANEL WISE ENGINEERING EXPORTS

In this section we look at the Engineering Panel wise exports for the month of March 2025 vis-à-vis March 2024 as well as the cumulative exports for April-March 2024-25 vis-à-vis April-March 2023-24. These are indicated in the tables below.

Reasons for Decline (As per April-March 2024-25):
Ferrous products
Export Performance:
    i. Iron and Steel: Significant decline of 30% from March 2024 to March 2025, and a 22% decline from April-March 2023-24 to April-March 2024-25.
    ii. Products of Iron and Steel: Slight decline of 1% from March 2024 to March 2025, but a 2% growth from April-March 2023-24 to April-March 2024-25.
    iii. Overall Ferrous Products: Decline of 17% from March 2024 to March 2025, and an 11% decline from April-March 2023-24 to April-March 2024-25.
 US Tariffs: The 25% tariffs imposed by the US on steel imports ( as per the proclamation order dated on 18th March 2025) have created a challenging environment for Indian steel exporters. Although India's direct steel exports to the US are relatively low, the tariffs have led to increased global competition and price pressures. The tariffs have also resulted in a shift in trade flows.
Impact of US Tariffs on India's Steel Exports: (i) While the direct impact of US tariffs on India's steel exports is limited due to the low volume of exports to the US, the indirect effects are significant. The tariffs have led to increased global competition and price pressures, affecting India's export competitiveness. (ii) India's Directorate General of Trade Remedies
(DGTR) initiated a 12% safeguard duty on a broad range of steel products for 200 days, starting from April 21, 2025. This measure aims to protect the domestic market from a surge in imports.
While this move is intended to shield local producers, it has also led to increased costs for user industries, potentially impacting their competitiveness
 
a) Overall price scenario in various countries post imposition of US tariff :
    
    (i) US: The US imposed a 25% tariff on all steel imports, which has significantly boosted domestic steel prices. Hot-rolled coil (HRC) prices soared, with the Midwest HRC price averaging $807 per short ton in March, up from $698 in January. The tariffs have led to increased demand for domestic steel, extending delivery lead times and pushing up prices further. (Source: SPG Platts Connet)
    
    (ii)China: The Chinese steel market experienced muted sentiment due to the US tariffs. Steel prices have remained relatively flat, with hot-rolled coil prices averaging 3,419 yuan per metric ton in March 2025. The tariffs have created uncertainty, leading to cautious buying behavior and concerns about a potential trade war. (Source: SPG Platts Connet)
     
    (iii) European Union: EU flat steel prices have risen due to expectations of tighter import quotas in response to the US tariffs and improving manufacturing activity. Northern EU flat steel prices reached a six-month high of €615 per metric ton in early March 2025. (Source: SPG Platts Connet)
    (iv) Turkey: Turkey's scrap prices have strengthened due to higher US steel and scrap prices. However, slow rebar sales have capped further gains.
    (v)India: The Indian government has imposed a provisional 12% safeguard duty on specific non-alloy and alloy steel flat products, effective from April 21, 2025. This measure, following DGTR's findings of a surge in imports causing harm to domestic producers, aims to protect local steel manufacturers. Exemptions apply to imports from developing countries (excluding China and Vietnam) and products priced above certain thresholds. The duty will be in effect for 200 days, providing temporary relief to stabilize domestic steel prices and support the industry.( Source: BigMint)
  • Non- Ferrous Sector (Copper and Alumimnium)
Copper
The copper exports declined by 15% in March 2025 and 8% in April-March 2024-25. The decline can be majorly attributed to India’s growing copper demand and its position as a net copper importer due to the shutdown of the Sterlite Copper plant in Tamil Nadu's Tuticorin in 2018. As per the Ministry of Mines, India’s domestic demand for copper is expected to increased by 1.7 million tonnes by 2027.
Aluminium
The Aluminium exports declined by 10% in April-March 2024-25. However, it exhibited growth of 13% in March 2025. The decline in aluminium can be attributed to the following reason - RODTEP benefit to SEZ units was only provided in October, November and December 2024 although the scheme was implemented from April 2024 for entire financial year. This is making exports unviable, and not competitive. Declining exports to the US due to the tariff situation is also a cause of concern.
Table 4a. Trend in exports of iron and steel and its products

(US$ million)

Product panels May-2024 May-2025 Growth April-May 2023-24 April-May 2024-25 Growth
IRON AND STEEL 748.33 772.69 3.25% 1592.13 1624.57 2.04%
PRODUCTS OF IRON AND STEEL 820.44 877.18 6.92% 1551.32 1648.27 6.25%
Sub Total 1568.77 1649.87 5% 3143.45 3272.84 4%

Source : DGCI&S

Table 4b. Trend in exports of Non-Ferrous Metals and Products

US$ Million

Product panels May-2024 May-2025 Growth April-May 2023-24 April-May 2024-25 Growth
Aluminium and products made of Aluminium 598.1 538.72 -9.93% 1127.67 1033.81 -8.32%
Copper and products made of copper 159.41 191.08 19.87% 287.11 373.25 30.01%
Lead and products made of Lead 84.31 81.67 -3.13% 147.45 157.65 6.92%
Nickel and products made of Nickel 12.09 13.05 7.92% 25.33 26.5 4.62%
Other Non Ferrous Metals and their products 68.63 87.57 27.6% 129.45 169.37 30.84%
Tin and products made of Tin 2.3 2.26 -1.5% 3.52 3.98 13.24%
Sub Total 924.83 914.36 -1% 1720.53 1764.57 3%

Source : DGCI&S

Table 4c. Trend in exports of Industrial Machinery

US$ Million

Product panels May-2024 May-2025 Growth April-May 2023-24 April-May 2024-25 Growth
Air condition and Refrigeration Machinery and Parts, Industrial Furnaces, Water heaters and Centrifuges and Compressor 147.03 189.68 29.01% 283.74 377.35 32.99%
IC Engines and Parts 301.95 364.86 20.84% 589.18 690.2 17.15%
Industrial Machinery for dairy, agriculture, food processing, textiles, paper, chemicals, etc 674.12 759.98 12.74% 1359.58 1457.69 7.22%
Machine Tools 68.52 62.93 -8.16% 128.48 129 0.4%
Machinery for ATMs, Injecting Moulding machinery, valves, etc 233.81 252.69 8.08% 440.17 494.95 12.45%
Nuclear Reactors, Industrial Boilers and Parts 54.02 65.4 21.07% 119.86 179.26 49.55%
Pumps of all types 126.94 128.01 0.84% 234.96 248.41 5.72%
Sub Total 1606.39 1823.56 13.52% 3155.97 3576.85 13.34%

Source : DGCI&S

Table 4d. Trend in exports of Electrical Machinery and Equipment

US$ Million

Product panels May-2024 May-2025 Growth April-May 2023-24 April-May 2024-25 Growth
Electric Machinery and Equipment 1138.34 1303.45 14.5% 2169.72 2495.71 15.02%

Source : DGCI&S

Table 4e. Trend in exports of Auto and auto parts

US$ Million

Product panels May-2024 May-2025 Growth April-May 2023-24 April-May 2024-25 Growth
AUTO COMPONENTS/PARTS 709.963 729.643 2.77% 1315.204 1383.131 5.16%
AUTO TYRES AND TUBES 281.477 283.205 0.61% 534.694 540.098 1.01%
Motor Vehicle/cars 723.872 859.759 18.77% 1326.589 1682.283 26.81%
Two and Three Wheelers 268.514 300.87 12.05% 516.819 563.438 9.02%
Sub Total 1983.827 2173.476 9.56% 3693.306 4168.95 12.88%

Source : DGCI&S

Table 4f. Trend in exports of aircraft, spacecraft and parts and ships, boats and floating structures

US$ Million

Product panels May-2024 May-2025 Growth April-May 2023-24 April-May 2024-25 Growth
Aircrafts, Spacecrafts and Parts 858.52 125.63 -85.37% 1139.16 254.08 -70.4%
Ships, Boats and Floating Structures 524.01 392.34 -25.13% 789.16 901.36 72.01%
Sub Total 1382.53 517.97 -62.53% 1928.32 1155.44 -40.08%

Source : DGCI&S

Table 4g. Trend in exports of other engineering products

US$ Million

Product panels May-2024 May-2025 Growth April-May 2023-24 April-May 2024-25 Growth
BICYCLE AND PARTS 33.54 40.61 21.05% 61.6 76.81 24.67%
Hand Tools, Cutting Tools and Implements made of Metals 83.08 88.92 7.03% 160.65 177.69 10.61%
OFFICE EQUIPMENTS 24.03 31.82 32.4% 42.61 56.1 31.65%
OTHER CONSTRUCTION MACHINERY 265.03 311.53 17.55% 507.95 580.24 14.23%
PRIME MICA AND MICA PRODUCTS 2.64 3.46 31.18% 4.88 6.31 29.48%
Railway Transport and Parts 21.84 32.77 50.03% 53 63.25 19.34%
PROJECT GOODS 0.11 0.06 -46.39% 0.22 0.11 -47.91%
OTHR RUBBER PRODCT EXCPT FOOTW 148.41 160.78 8.33% 285.3 308.3 8.06%

Source : DGCI&S

ENGINEERING PRODUCT PANELS – COUNTRY-WISE ANALYSIS

We now analyze the performance of some of the important products for the fiscal April-March 2024-25 vis-à-vis April-March 2023-24. We have taken the major panels and computed the top importers to get an idea of the current trade pattern.

Table 5: Export of Different Panels

(US$ million)

Product panels Top 5 nations April-May 2023-24 April-May 2024-25 Growth (%)
Iron and Steel and Products made of Iron and Steel
U S A 532.37 677.34 27%
U ARAB EMTS 167.28 226.38 35%
ITALY 312.3 215.27 -31%
NEPAL 116.25 160.97 38%
BELGIUM 130.83 142.15 9%
Non-Ferrous Metals and Products made of Non-Ferrous Metals
U S A 234.16 297.28 27%
KOREA RP 177.6 186.74 5%
SAUDI ARAB 89.54 142.9 60%
TAIWAN 31.98 75.81 137%
JAPAN 76.51 75.3 -2%
Industrial Machinery
U S A 664.38 774.09 17%
U ARAB EMTS 144.32 210.01 46%
GERMANY 158.41 155.44 -2%
CHINA P RP 161.17 141.77 -12%
THAILAND 124.76 140.82 13%
Electrical Machinery
U S A 455.85 500.76 10%
U K 161.95 263.01 62%
SINGAPORE 203.8 250.89 23%
GERMANY 121.25 166.18 37%
KOREA RP 90.93 138.82 53%
Automobiles
U S A 403.92 414.87 3%
MEXICO 335.27 302.83 -10%
SAUDI ARAB 257.28 262.86 2%
SOUTH AFRICA 185.49 256.89 38%
U ARAB EMTS 128 194.42 52%
Aircrafts and Spacecraft parts and products
U S A 74.66 70.98 -5%
FRANCE 36.32 38.98 7%
U K 25.49 27 6%
SINGAPORE 8.82 17.47 98%
GERMANY 13.81 13.68 -1%
Ships Boats and Floating products and parts
SINGAPORE 234.79 446.02 90%
U ARAB EMTS 305.93 269.06 -12%
OMAN 0.06 54.32 98269%
TOGO 0 46.85 N/A
INDONESIA 12.01 38.07 217%
Project Goods
SAUDI ARAB 0 0.02 1062%
FRANCE 0.01 0.02 222%
U S A 0.06 0.02 -70%
CONGO D. REP. 0 0.01 N/A
AUSTRALIA 0 0.01 N/A
Other Rubber Product Except Footwear
U S A 65.86 70.67 7%
GERMANY 19.38 20.12 4%
CHINA P RP 11.29 12.77 13%
U ARAB EMTS 10.39 12.58 21%
NETHERLAND 9.48 10.42 10%
Other engineering products
U S A 152.07 170.33 12%
U ARAB EMTS 39 56.06 44%
U K 47.34 51.89 10%
GHANA 27.73 50.63 83%
BRAZIL 24.62 33.4 36%

Source : DGCI&S

ENGINEERING EXPORTS – STATE-WISE ANALYSIS

State wise engineering export performance

The table below indicates the exports from top Indian states. It is evident from the table that almost 94.7 % of India’s exports is contributed by the listed 12 states. Within this almost 56.5 percent of exports is done by Maharashtra, Tamil Nadu and Gujarat together.

  •  Top 12 states constitute over 94.9 % of India’s engineering Exports. Once again, Karnataka maintained its 5th position, Telengana retained its 4th position, Odisha maintaining its 6th position, West Bengal moving up to 9th position, while Daman and Diu remained at 12th position and Haryana moved down to 13th position during the fiscal April-March 2024-25 compared to the same period last fiscal.( as per estimates of Niryat Portal)
  •  Major negative growth witnessed in states like Maharashtra, Odisha, Andhra Pradesh,Rajasthan and Daman and Diu during April-March 2024-25 compared to the same period last fiscal.
  •  Maharashtra being the highest state in terms of Engineering Goods exports ( constituting a share of 22.6%) is leading by US$ 4.44 billion from Tamil Nadu(Second Highest State) for the period of April-March 2024-25.
Table 6: Top state wise engineering export performance - April-March 2025-26

(US$ million)

Top States Cumulative Export April-March 2025-26 Share % Remark
Maharashtra 22546.4 19.65% 91.5% share covered by top 12 states
Tamil Nadu 18108.6 15.78%
Gujarat 16590.5 14.46%
Telangana 7536.2 6.57%
Karnataka 7277.3 6.34%
Haryana 6764.5 5.9%
Odisha 5910.1 5.15%
Delhi 4684.5 4.08%
Uttar Pradesh 4348.7 3.79%
Andhra Pradesh 4319.4 3.77%
West Bengal 3523.7 3.07%
Rajasthan 3375.7 2.94%
Punjab 2661.3 2.32%
Madhya Pradesh 2013.1 1.75%
Daman & Diu And Dadra & Nagar Haveli 1242 1.08%
Kerala 840.9 0.73%
Jharkhand 807.2 0.7%
Chhattisgarh 754.6 0.66%
Uttarakhand 549.2 0.48%
Goa 405.8 0.35%
Puducherry 180.2 0.16%
Himachal Pradesh 124.8 0.11%
Bihar 61.1 0.05%
Chandigarh 51.7 0.05%
Assam 19.4 0.02%
Tripura 10.9 0.01%
Jammu & Kashmir 10.2 0.01%
Arunachal Pradesh 1.8 0%
Sikkim 1 0%
Manipur 0.8 0%
Lakshadweep 0.1 0%
Andaman & Nicobar 0.1 0%
Meghalaya 0.1 0%
Nagaland 0 0%
Ladakh 0 0%
Mizoram 0 0%

Source : DGCI&S

Region wise engineering exports

The following table depicts region wise India’s engineering exports for 2024-25 as compared to 2023-24.

Note : DGCI&S state wise data available till Mar-2025

Table 7: Region wise exports from India till Mar-2025

Value in US$ million

Region Mar-2024($Mn) Mar-2025($Mn) Growth % Apr-Mar 2023-24($Mn) Apr-Mar 2024-25 ($Mn) Growth %
WESTERN REGION 4070.4 4143.4 1.79% 41415.4 42797.8 3.34%
SOUTHERN REGION 3884.2 3310.4 -14.77% 33012.2 38262.7 15.9%
EASTERN REGION 1096.1 989.8 -9.7% 12236.7 11089.8 -9.37%
NORTHERN REGION 2235 432.9 -80.63% 22650.9 22571.6 -0.35%
Grand Total 11285.7 8876.5 -21.35% 109315.2 114721.9 4.95%

CORRELATION BETWEEN MANUFACTURING PRODUCTION AND ENGINEERING EXPORTS

Engineering forms a considerable part of the broader manufacturing sector and the share of engineering production in overall manufacturing output is quite significant. As exports generally come from what is produced within a country, some correlation between manufacturing production growth and engineering export growth should exist. We briefly look at the trend in manufacturing growth as also engineering export growth to see if they move in tandem. It may be mentioned that manufacturing has 77.63% weightage in India’s industrial production.

Engineering export growth and manufacturing output growth moved in the same direction in as many as nine out of twelve months in each of the fiscal years 2019-20 and 2020-21. During fiscal 2021-22, engineering export growth and manufacturing growth moved in the same direction in seven out of twelve months while in each of fiscal 2022-23 and 2023-24, as many as 10 out of 12 months saw engineering exports and manufacturing output moved in the same direction.

The first two month of fiscal 2024-25 also saw manufacturing output growth and engineering exports growth moving in the same direction. April 2024 saw engineering exports declined from a growth in Mar 2024 and manufacturing output growth decelerated. The month of May 2024 witnessed just the opposite. Engineering exports bounced back to growth path and manufacturing output growth accelerated. Then June and July 2024 however saw both moved in the opposite direction but August 2024 saw both engineering export growth and manufacturing growth slowing down. September and October 2024 again saw both moving in the same direction by securing acceleration in growth. November 2024 however saw slowdown in engineering export growth but faster manufacturing growth vis-à-vis October 2024 while growth in both engineering exports and manufacturing output moderated in December 2024. In January 2025 once again, the direction was opposite but in February both moved in the same direction as engineering exports declined and manufacturing growth moderated.

The link between these two may not be established monthly, but a positive correlation may be seen if medium to long term trend is considered.

Table 8: Engineering exports growth vis-à-vis manufacturing growth from April 2020
Months/ Year Engg. Export Growth (%) Manufacturing Growth (%)
April 2020 -63.05 -66.6
May 2020 -22.17 -37.8
June 2020 -5.18 -17.0
July 2020 10.56 -11.4
August 2020 -7.01 -7.6
September 2020 4.09 0.4
October 2020 -5.01 4.5
November 2020 -8.37 -1.6
December 2020 -0.93 2.7
January 2021 16.66 -0.9
February 2021 -4.94 -3.4
March 2021 67.75 28.3
April 2021 236.85 196.0
May 2021 50.21 32.1
June 2021 51.00 13.2
July 2021 42.57 10.5
August 2021 58.63 11.1
September 2021 35.11 4.3
October 2021 51.76 3.3
November 2021 37.28 0.3
December 2021 47.42 0.6
January 2022 25.63 1.9
February 2022 35.49 0.2
March 2022 19.72 1.4
April 2022 18.30 5.6
May 2022 11.45 20.6
June 2022 3.01 13.0
July 2022 -0.03 3.2
August 2022 -12.64 -0.5
September 2022 -11.39 2.0
October 2022 -19.68 -5.8
November 2022 0.09 6.7
December 2022 -11.60 3.6
January 2023 -9.76 4.0
February 2023 -9.73 5.6
March 2023 -7.49 0.5
April 2023 -7.27 5.5
May 2023 -4.13 6.3
June 2023 -10.94 3.5
July 2023 -6.65 5.0
August 2023 7.83 9.3
September 2023 6.81 4.5
October 2023 7.20 N A
November 2023 -3.48 1.2
December 2023 9.82 4.5
January 2024 4.21 3.6
February 2024 15.9 5.0
March 2024 10.66 N A
April 2024 -4.49 3.9
May 2024 7.41 4.6
June 2024 10.27 N A
July 2024 3.66 4.6
August 2024 4.26 1.0
September 2024 9.44 3.9
October 2024 38.39 4.1
November 2024 13.72 5.5
December 2024 8.33 3.4
January 2025 7.46 5.5
February 2025 -8.64 2.9
April 2025 -3.92 3.0

Source :Department of Commerce and CSO

IMPACT OF EXCHANGE RATE ON INDIA’S EXPORTS

How did the exchange rate fare during March 2025 and what was the recent trend in Re-Dollar movement? In order to get a clearer picture of the recent Re-Dollar trend, not only we took the exchange rate of March 2025, but also considered monthly average exchange rate of Rupee vis-à-vis the US Dollar for each month of fiscal 2023-24 and 2024-25 as per the latest data published, as mere one-month figure does not reflect any trend. The following two tables clearly depicts the short-term trend:

Fig 3: Trend of Rupee vis-a-vis US dollar from April 2020

(Monthly Average Rate of FBIL has been considered)

Source : FBIL

Table 9: USD-INR monthly average exchange rate in 2025-26 vis-à-vis 2024-25

(As per latest data released by FBIL)

Monthly Average Exchange Rate (1 USD to INR) Year-on-Year Change (%) Direction Month-on-Month Change (%) Direction
Month 2024-25 2025-26
April 83.41 85.56 2.58 Depreciation -1.25 Appreciation
May 83.39 85.19 2.16 Depreciation -0.43 Appreciation

Rupee appreciated over the month in March 2025 for the first time after September 2024 but depreciation continued on a year-on-year basis: INR appreciated vis-à-vis the US Dollar by 0.47 percent in March 2025 over the previous month as reciprocal tariff imposed by the USA has created panic about the US economic prospect in the short term leading to weakening of dollar. On a year-on-year basis however, rupee continued to weaken.

Outlook: Currency market may remain volatile till a stability is seen in tariff war and rupee may witness mild gains in the near term.

Table 10: USD-INR monthly average exchange rate in 2024-25 vis-à-vis 2023-24

(As per latest data released by FBIL)

Monthly Average Exchange Rate (1 USD to INR) Year-on-Year Change (%) Direction Month-on-Month Change (%) Direction
Month 2023-24 2024-25
April 82.02 83.41 1.69 Depreciation 0.49 Depreciation
May 82.34 83.39 1.28 Depreciation -0.02 Appreciation
June 82.23 83.47 1.51 Depreciation 0.10 Depreciation
July 82.15 83.59 1.75 Depreciation 0.14 Depreciation
August 82.79 83.89 1.33 Depreciation 0.36 Depreciation
September 83.05 83.81 0.92 Depreciation -0.10 Depreciation
October 83.24 84.02 0.94 Depreciation 0.25 Depreciation
November 83.30 84.36 1.27 Depreciation 0.40 Depreciation
December 83.28 84.99 2.05 Depreciation 0.75 Depreciation
January 83.14 86.27 3.76 Depreciation 1.51 Depreciation
February 82.96 87.05 4.93 Depreciation 0.90 Depreciation
March 83.00 86.64 4.39 Depreciation -0.47 Appreciation

Source : FBIL, EEPC Research

TREND IN ENGINEERING TRADE BALANCE

We now present the trend in two-way yearly trade for the engineering sector for the 2024-25 depicted in the table below:

Table 11: Monthly Trend in Engineering Trade Balance for the current FY

(US$ million)

Trade Flow April May
Engineering Export 9.5 9.9
Engineering Import 13.4 13.8
Trade Balance -3.9 -3.9

Source : DGCI&S

TO CONCLUDE...

FY 2024-25 has been an overall positive year for the Indian engineering exports. It was another record breaking performance of Indian engineering exports in 2024-25 as it secured a new all-time high at USD 116.7 billion, surpassing the previous high of USD 112.10 billion achieved in fiscal 2021-22. In this process the engineering exports recorded a growth 6.7% and also outweighed the merchandise exports which recorded a growth of only 0.08% during the same time. The share of engineering exports in total mechandise exports has also risen to 26.7% in the current fiscal as against 25% in the last fiscal. This was possible even though the exporters faced a number of global adversities.

In the coming days, the engineering exporting community of India needs to prepare for the continually changing and uncertain global trade dynamics. As we enter a new financial year, the global trade is undergoing significant disruptions, the most important being the announcement of US president Donald Trump’s “Liberation Day Tariff” which has already sparked retaliatory measures from other countries and concerns about global economic stability. The WTO has already sounded caution – according to them under the current conditions the volume of global merchandise trade is likely to fall by 0.2 percent in 2025. The organisation has further added that although the temporary pause may arrest some trade contraction, there are significant downside risks including retaliation by other countries and policy uncertainty which may further impact global trade volume by around 1.5%, particularly hurting the export-oriented least developed countries. The tariffs are a new addition to the list of trade disruptions that have been ongoing in the recent years including global conflicts and rise of protectionism.

In this situation it is important for the government and the industry to adopt strategies that will help us mitigate the issue to our advantage. The decision to negotiate a bilateral trade agreement with the US is a welcome step. Simultaneous to this, it is also essential for us to diversify our export destinations. I am thankful to the Ministry of Commerce and Industry for their continuous support and hope that this will continue such that our exporters can strengthen their global market presence.