August 2026

Engineering exports continued to grow in 2026-27 after achieving record high in 2025-26

After achieving a high growth of 11.28 percent year-on-year in April 2025, Indian engineering exports conceded a marginal 0.82 percent decline in May 2025 over the same month last fiscal.
Engineering exports from India in May 2025 was recorded at USD 9,887.01 million as against USD 9,968.45 million in May 2024, registering 0.82 percent drop in shipment.
Engineering exports was higher in May 2025 in comparison to April 2025 but the year-on-year decline in May 2025 was due to higher statistical base.
On a cumulative basis however, India’s engineering export recorded 4.77 percent growth as it went up to USD 19,398.58 million during Apr-May 2025-26 from USD 18,516.06 million during the same period last fiscal.
According to the Quick Estimates of Department of Commerce, Government of India, share of engineering in India's total merchandise exports increased to 25.53 percent  in May 2025 from 24.71 percent in April 2025. 
On a cumulative basis, share of engineering in total merchandise exports druing Apr-May 2025-26 stood at 25.13 percent. 
In May 2025, 26 out of 34 engineering panels witnessed positive year-on-year growth. While 8 engineering panels including mainly Non ferrous metals like Aluminium, Zinc, Lead, Tin, Machine Tools, Aircrafts and Spacecrafts, Ship and Boats, etc witnessed decline in exports during May 2025 vis-à-vis May 2025. 
On a cumulative basis, 29 out of 34 engineering panels recorded positive growth and remaining 5 engineering panels including Non-ferrous sectors including Aluminium products, Zinc products, Aircraft and Spacecrafts, Cranes and Winches recorded negative growth during April-May 2025-26. 

                                            Region wise, North America maintained its spot as the number one export destination with a share of 21.3% followed by EU (17.7%) and WANA (14.3%) in Apr-May 2025. Significant export growth was noted in Oceania (26.8%), SSA (24.1%) and ASEAN (8.8%) in May 2025.
                                        

                                            Country-wise, USA remained the top destinations followed by UAE and Singapore in May 2025 while maximum increase was noted in Belgium (54.3%), Netherlands (51.3%), Nepal (30.1%) and Singapore (29.2%).
                                        

Monthly Trend

Highlights

Product Panels

Impact of Exchange Rate

Conclude

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August-2026 engineering exports hit peak growth for fiscal 2025-2026

After achieving a high growth of 11.28 percent year-on-year in April 2025, Indian engineering exports conceded a marginal 0.82 percent decline in May 2025 over the same month last fiscal. Engineering exports from India in May 2025 was recorded at USD 9,887.01 million as against USD 9,968.45 million in May 2024. Although, engineering exports was higher in May 2025 in comparison to April 2025, the year-on-year decline in May 2025 was due to higher statistical base. Among the major product groups, exports of ‘Aircraft, Spacecrafts and Parts’ slumped by 85 percent and that of ‘Ships, Boats and Floating Structures’ dropped by 25 percent year-on-year in May 2025 that mainly caused the decline in overall engineering exports. Country-wise analysis revealed that substantial decline in engineering exports to UAE and Saudi Arabia among the top exporting countries impacted overall engineering exports negatively.

Trade Flow	Export figures(in $ billion)				Growth (%)
	May-2025	May-2026	Apr-May 2024-25	Apr-May 2025-26	May-2026 over May-2025	Apr-May 2024-25 over Apr-May 2025-26
							Engineering exports	9.87	12.32	49.10	58.70	24.86%	19.55%
							Overall Merchandise exports	34.74	43.81	183.21	215.91	26.12%	17.85%
Share of engineering (%)	28.41%	28.12%	26.80%	27.19%	---	---
Service Exports	31.19	38.87	162.34	183.36	24.62%	12.95%

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 2025-26 vis-à-vis 2024-25 are shown below as per the latest DGCI&S estimates:

Table 1: Engineering Exports: Monthly Trend in 2025-26

US$ million

Month	2024-25	2025-26	Growth (%)
April	9515.77	10351.01	8.78
May	9890.43	12311.33	24.48
June	9506.71	11478.69	20.74
April-June	28912.91	34143.99	18.09
July	10399.9	12242.18	17.71
August	9867.17	12319.81	24.86
April-August	49104.53	58704.34	19.55

Source : DGCIS, Govt. of India

TOP 25 ENGINEERING EXPORT DESTINATIONS IN April-August 2025-26

We now look at the export scenario of the top 25 nations that had highest demand for Indian engineering products during May 2025 over May 2024 as well as in cumulative terms during April-May 2025-26 vis-à-vis April-May 2024-25. The data clearly shows that top 25 countries contribute 75.5% of total engineering exports.

Table 2: Engineering exports country wise

(US$ million)

Countries	May-2025	May-2026	Growth (%)	April-August 2024-25	April-August 2025-26	Growth (%)
U S A	1679.73	2200.03	30.98%	8631.54	9971.84	15.53%
U K	382.92	492.61	28.64%	1922.58	2299.59	19.61%
GERMANY	412.77	487.97	18.22%	2030.36	2317.74	14.15%
U ARAB EMTS	649.12	475.93	-26.68%	3077.86	3008.27	-2.26%
KOREA RP	220.93	466.06	110.95%	1172.67	1624.69	38.55%
CHINA P RP	242.5	424.65	75.11%	1087.75	1774.28	63.12%
SOUTH AFRICA	309.78	392.97	26.86%	1156.97	1510.96	30.6%
MEXICO	309.2	360.24	16.51%	1385.51	1649.46	19.05%
INDONESIA	103.62	292.3	182.1%	676.61	1031.26	52.42%
ITALY	302.66	285.03	-5.83%	1379.26	1382	0.2%
SINGAPORE	189.98	282.81	48.86%	1780.46	2004.68	12.59%
JAPAN	164.65	278.38	69.08%	1057.94	1399.57	32.29%
AUSTRALIA	127.15	275.97	117.03%	612.1	980.41	60.17%
BRAZIL	216.02	237.47	9.93%	1075	1136.28	5.7%
FRANCE	190.56	233.03	22.29%	930.27	1198.79	28.86%
MALAYSIA	141.09	231.24	63.89%	545.48	1150.86	110.98%
SRI LANKA DSR	127.74	230.84	80.72%	548.48	1323.96	141.39%
NEPAL	211.94	227.09	7.15%	1008.14	1118.84	10.98%
SAUDI ARAB	358.93	224.94	-37.33%	1836.93	1640.67	-10.68%
TURKEY	162.05	224.36	38.45%	862.12	908.93	5.43%
THAILAND	174.78	222.29	27.18%	904.1	926.53	2.48%
OMAN	57.37	197.99	245.11%	340.86	800.01	134.7%
VIETNAM SOC REP	142.46	191.32	34.3%	614.9	1023.52	66.45%
NETHERLAND	194.95	187.52	-3.81%	927.9	979.8	5.59%
BANGLADESH PR	174.75	162.28	-7.14%	862.19	745.45	-13.54%
Total engineering exports to top 25 countries	7247.65	9285.33	28.12%	36428	43908.39	20.53%
Total engineering exports	9867.17	12319.81	24.86%	49104.53	58704.34	19.55%

Source : DGCI&S

REGION WISE INDIA’S ENGINEERING EXPORTS

The following table depicts region wise India’s engineering exports for April-May 2025 as compared to April-May 2024

Table 3: Region wise engineering exports in April-February 2023-2024 vis-à-vis April-August 2024-2025

(US$ million)

Regions	May-2025	May-2026	Growth (%)	April-August 2024-25	April-August 2025-26	Growth (%)
NORTH AMERICA	2117.84	2721.76	28.52%	10574.56	12346.6	16.76%
EUROPEAN UNION	1810.33	1958.69	8.2%	8720.95	9742.07	11.71%
ASEAN	840.47	1311.01	55.99%	4998.63	6600.22	32.04%
N E ASIA	714.26	1286.62	80.13%	3807.37	5409	42.07%
WANA	1450.02	1286.27	-11.29%	7080.89	7299.97	3.09%
SSA( Sub Saharan Africa)	888.13	1165.56	31.24%	3882.1	5021.91	29.36%
OTHER EUROPE	584.26	763.63	30.7%	2979.01	3510.14	17.83%
LATIN AMERICA	566.35	754.72	33.26%	2967.46	3459.05	16.57%
SOUTH ASIA	567.19	684.97	20.77%	2692.74	3561.34	32.26%
OCEANIA	139.3	286.91	105.97%	673.17	1042.37	54.84%
CIS	165.46	87.11	-47.35%	655.56	624.09	-4.8%
OTHERS	23.57	12.56	-46.7%	72.09	87.57	21.48%

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 May 2025 vis-à-vis May 2024 as well as the cumulative exports for April-May 2025-26 vis-à-vis April-May 2024-25. These are indicated in the tables below.

Table 4a. Trend in exports of iron and steel and its products

(US$ million)

Product panels	August-2025	August-2026	Growth	April-August 2024-25	April-August 2025-26	Growth
IRON AND STEEL	841.53	1279.12	52%	4036.63	5489.21	35.98%
PRODUCTS OF IRON AND STEEL	890.16	933.68	4.89%	4375.34	4374.1	-0.03%
Sub Total	1731.68	2212.8	28%	8411.97	9863.31	17%

Source : DGCI&S

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

US$ Million

Product panels	August-2025	August-2026	Growth	April-August 2024-25	April-August 2025-26	Growth
Aluminium and products made of Aluminium	543.87	736.16	35.36%	2571.72	3819.97	48.54%
Copper and products made of copper	226.83	598.96	164.05%	1024.9	2067.41	101.72%
Lead and products made of Lead	96.23	58.59	-39.11%	442.07	334.82	-24.26%
Nickel and products made of Nickel	15.88	18.09	13.95%	70.82	89.01	25.68%
Other Non Ferrous Metals and their products	85.29	97.18	13.95%	436.99	494.62	13.19%
Tin and products made of Tin	2.82	7.23	156.52%	12.52	33.58	168.1%
Zinc and products made of zinc	57.96	61.19	5.56%	257.88	371.93	44.23%
Sub Total	1028.88	1577.41	53%	4816.91	7211.34	50%

Source : DGCI&S

Table 4c. Trend in exports of Industrial Machinery

US$ Million

Product panels	August-2025	August-2026	Growth	April-August 2024-25	April-August 2025-26	Growth
Air condition and Refrigeration Machinery and Parts, Industrial Furnaces, Water heaters and Centrifuges and Compressor	179.8	219.18	21.9%	924.67	1022.04	10.53%
IC Engines and Parts	350.63	414.62	18.25%	1767.64	1830.39	3.55%
Industrial Machinery for dairy, agriculture, food processing, textiles, paper, chemicals, etc	760.24	760.74	0.06%	3712.68	3859.61	3.96%
Machine Tools	85.31	71.23	-16.5%	389.72	365.23	-6.29%
Machinery for ATMs, Injecting Moulding machinery, valves, etc	258.37	274.07	6.08%	1288.15	1325.63	2.91%
Nuclear Reactors, Industrial Boilers and Parts	86.23	211.54	145.33%	394.45	575.4	45.87%
Pumps of all types	133.07	155.21	16.63%	657.39	707.18	7.57%
Sub Total	1853.65	2106.6	13.65%	9134.7	9685.49	6.03%

Source : DGCI&S

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

US$ Million

Product panels	August-2025	August-2026	Growth	April-August 2024-25	April-August 2025-26	Growth
Electric Machinery and Equipment	1151.17	1595.2	38.57%	6381.79	7992.11	25.23%

Source : DGCI&S

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

US$ Million

Product panels	August-2025	August-2026	Growth	April-August 2024-25	April-August 2025-26	Growth
AUTO COMPONENTS/PARTS	766.221	851.492	11.13%	3646.74	3904.975	7.08%
AUTO TYRES AND TUBES	254.226	295.827	16.36%	1328.275	1419.175	6.84%
Motor Vehicle/cars	1017.688	1049.774	3.15%	4353.944	4912.085	12.82%
Two and Three Wheelers	347.13	426.169	22.77%	1561.915	1989.336	27.37%
Sub Total	2385.265	2623.262	9.98%	10890.873	12225.571	12.26%

Source : DGCI&S

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

US$ Million

Product panels	August-2025	August-2026	Growth	April-August 2024-25	April-August 2025-26	Growth
Aircrafts, Spacecrafts and Parts	135.22	162.96	20.51%	673.44	781.75	478.13%
Ships, Boats and Floating Structures	94.59	367.8	288.82%	1707.01	3084.77	3161.03%
Sub Total	229.82	530.76	130.95%	2380.45	3866.53	62.43%

Source : DGCI&S

Table 4g. Trend in exports of other engineering products

US$ Million

Product panels	August-2025	August-2026	Growth	April-August 2024-25	April-August 2025-26	Growth
BICYCLE AND PARTS	42.97	47.02	9.43%	196.09	214.31	9.29%
Cranes, Lifts and Winchescopper	94.19	106.68	13.26%	469.44	473.09	0.78%
Hand Tools, Cutting Tools and Implements made of Metals	88.95	99.64	12.02%	444.88	474.14	6.58%
Medical and Scientific Instrumentsents	239.68	283.11	18.12%	1191.86	1294.84	8.64%
OFFICE EQUIPMENTS	34.48	33.11	-3.97%	159.54	146.57	-8.13%
OTHER CONSTRUCTION MACHINERY	298.73	322.91	8.09%	1416.18	1604.75	13.32%
OTHER MISC. ENGINEERING ITEMS	466.46	538.14	15.37%	2207.53	2488.89	12.75%
PRIME MICA AND MICA PRODUCTS	2.92	3.23	10.58%	13.7	14.41	5.16%
Railway Transport and Parts	52.55	52.58	0.05%	190.8	285.79	49.79%
PROJECT GOODS	0.15	0.2	38.23%	0.57	0.81	42.46%
OTHR RUBBER PRODCT EXCPT FOOTW	165.63	187.16	13%	797.26	862.39	8.17%

Source : DGCI&S

ENGINEERING PRODUCT PANELS – COUNTRY-WISE ANALYSIS

We now analyze the performance of some of the important products for the fiscal April-May 2025-26 vis-à-vis April-May 2024-25. We have taken the major panels and computed the top importers to get an idea of the current trade pattern.

In April-May 2025, Italy, USA and Nepal ranked as the top importers of Indian Iron and Steel, while the USA, UAE and Germany lead in import of products of Iron & Steel.

The USA stood out as the primary importer of Indian 'Industrial machinery,' making up 22% of India's global exports in this category, followed by UAE and Germany with 6% ad 4% shares, respectively.

Saudi Arabia, South Africa, Mexico and Japan were top importers of India's Automobiles during April-May 2025 in India’s global exports respectively over the same period previous fiscal.

USA, South Korea and Saudi Arab were the top three importers of India's Non-ferrous metals and products during April-May 2025.

USA, UK, Singapore and Germany were the top importers of Indian Electrical Machinery & Components during the same period with 20%, 11%, 10% and 7% shares, respectively.

USA, France,UK and Singapore were the top importers of India's Aircrafts and Spacecraft during April-May 2025, making up to 61% of India’s total export of Aircrafts and Spacecraft

Singapore, UAE and Oman became the largest importer of ships, boats and floating structures followed by Togo and Indonesia.

For the auto components’ product group, USA remained the top importer in April-May 2025 followed by Germany, Brazil, Bangladesh and UAE.

Table 5: Export of Different Panels

(US$ million)

Product panels	Top 5 nations	April-August 2024-25	April-August 2025-26	Growth (%)
Iron and Steel and Products made of Iron and Steel
	U S A	1663.2	2319.51	39%
	U ARAB EMTS	577.28	596.85	3%
	ITALY	598.97	482.75	-19%
	U K	331.13	450.74	36%
	NEPAL	341.08	391.23	15%
Non-Ferrous Metals and Products made of Non-Ferrous Metals
	U S A	750.98	956.33	27%
	KOREA RP	432.81	694.27	60%
	CHINA P RP	286.31	627.64	119%
	SAUDI ARAB	383.41	473.06	23%
	JAPAN	148.5	307.23	107%
Industrial Machinery
	U S A	1941.72	2052.74	6%
	AUSTRALIA	169.38	468.44	177%
	CHINA P RP	357.05	445.22	25%
	GERMANY	412.46	419.73	2%
	U ARAB EMTS	507.65	375.05	-26%
Electrical Machinery
	U S A	1347.87	1435.29	6%
	SINGAPORE	608.1	837.06	38%
	U K	667.22	693.12	4%
	GERMANY	461.45	573.08	24%
	MALAYSIA	138.47	540.42	290%
Automobiles
	U S A	989.79	1141.09	15%
	MEXICO	806.26	927	15%
	SOUTH AFRICA	785.17	871.33	11%
	SAUDI ARAB	682.15	477.89	-30%
	JAPAN	426.28	470.16	10%
Aircrafts and Spacecraft parts and products
	U S A	199.7	251.75	26%
	FRANCE	122.23	127.44	4%
	U K	78.17	69.34	-11%
	MALDIVES	0.57	60.1	10361%
	MALAYSIA	21.23	36.98	74%
Ships Boats and Floating products and parts
	U ARAB EMTS	559.68	986.05	76%
	SINGAPORE	690.36	656.08	-5%
	SRI LANKA DSR	90.79	502.97	454%
	OMAN	65.94	246.99	275%
	INDONESIA	96.23	164.71	71%
Project Goods
	U S A	0.1	0.26	158%
	SUDAN	0	0.1	N/A
	FRANCE	0.05	0.09	83%
	BELGIUM	0	0.04	4585%
	BHUTAN	0	0.03	573%
Other Rubber Product Except Footwear
	U S A	185.52	176.47	-5%
	GERMANY	56.65	56.28	-1%
	CHINA P RP	31.55	44.89	42%
	THAILAND	18.85	33.06	75%
	U ARAB EMTS	32.16	31.73	-1%
Other engineering products
	U S A	1550.76	1635.12	5%
	U K	308.11	364.2	18%
	GERMANY	323.77	333.24	3%
	U ARAB EMTS	332.58	244.37	-27%
	BRAZIL	179.84	195.64	9%

Source : DGCI&S

ENGINEERING EXPORTS – STATE-WISE ANALYSIS

State wise engineering export performance

State wise engineering export performance- Data as on 2024-25

( Note: Current fiscal 2025-26 data not yet updated as per Niryat Portal)

The table below indicates the exports from top Indian states. It is evident from the table that almost 91.5% of India’s exports is contributed by the listed 12 states. Within this almost 50 percent of exports is done by Maharashtra, Tamil Nadu and Gujarat together.

Top 12 states constitute over 91.5 % of India’s engineering Exports. Once again, Karnataka maintained its 5^th position, Telengana retained its 4^th position, Odisha coming down to 7^th position, West Bengal coming down to 11^th position, while Rajasthan moving up to 12^th position and Haryana remarkably moved up to 6^th 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 ( decline by 1.9%), Odisha, ( decline by 17.1%), Andhra Pradesh (decline by 11.6%) and Rajasthan (decline by 0.9%) 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 19.7%) 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-January 2025-26

(US$ million)

Top States	Cumulative Export April-January 2025-26	Share %	Remark
Maharashtra	9002.263806	19.41%	91% share covered by top 12 states
Gujarat	7199.068705	15.52%
Tamil Nadu	7180.333669	15.48%
Karnataka	3863.537776	8.33%
Haryana	3161.612301	6.82%
Odisha	3068.907955	6.62%
Delhi	1962.643404	4.23%
Uttar Pradesh	1581.200954	3.41%
West Bengal	1559.072079	3.36%
Rajasthan	1296.695018	2.8%
Andhra Pradesh	1253.307249	2.7%
Punjab	1005.792055	2.17%
Telangana	902.1049198	1.94%
Madhya Pradesh	743.8499594	1.6%
DADRA,NH,DAMAN,DIU	666.649629	1.44%
Kerala	418.6473398	0.9%
Uttarakhand	374.7063559	0.81%
Chhattisgarh	324.5452778	0.7%
JHARKHAND	284.7706012	0.61%
Goa	266.6275854	0.57%
Bihar	84.34716688	0.18%
Puducherry	66.91154219	0.14%
Himachal Pradesh	66.54811583	0.14%
CHANDIGARH	23.2553949	0.05%
Assam	11.18631801	0.02%
TRIPURA	0.89954665	0%
MANIPUR	0.447117976	0%
SIKKIM	0.339378285	0%
ARUNACHAL PRADESH	0.243958608	0%
Meghalaya	0.154116906	0%
LADAKH	0.011519783	0%
LAKSHADWEEP	0.002140265	0%
NAGALAND	0.000847883	0%
MIZORAM	0.00046254	0%
ANDAMAN AND NICOBAR ISLANDS	0	0%
Jammu & Kashmir		0%
Others		0%

Source : DGCI&S

Region wise engineering exports

In terms of region, western region which includes industrial states like Maharashtra and Gujarat is the front runner in terms of exports with 34.1 percent share. Tamil Nadu from the Southern Region has retained its export performance and it ranked second after Maharashtra, while Gujarat and Telengana ranked third and fourth during April-March 2024-25.

Note : DGCI&S state wise data available till May-2026

Table 7: Region wise exports from India till May-2026

Value in US$ million

Region	Apr-May 2024-25($Mn)	Apr-May 2025-26 ($Mn)	Growth %
WESTERN REGION	15028.79	17878.46	18.96%
NORTHERN REGION	8264.44	9472.47	14.62%
SOUTHERN REGION	12360.39	13684.84	10.72%
EASTERN REGION	3572.11	5334.91	49.35%
Grand Total	39225.72	46370.68	18.21%

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. In 2024-25, both moved in the same direction in eight out of 12 months.

The first month of fiscal 2025-26 saw engineering export growth surged to double digit while manufacturing growth decelerated.

The link between these two may not be established in one or two months, 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
May 2025	-0.80	2.6
June 2025	1.28	2.9
July 2025	13.86	5.4
August 2025	4.90	3.8
September 2025	2.93	4.8
October 2025	-16.72	1.8
November 2025	23.79	8.0
December 2026	1.29	8.4
January 2026	10.35	5.3
February 2026	12.91	6.0
March 2026	1.13	4.3
April 2026	8.78	6.2
May 2026	24.48	5.5
June 2026	20.90	7.8
July 2026	17.71	7.3

Source :Department of Commerce and CSO

IMPACT OF EXCHANGE RATE ON INDIA’S EXPORTS

How did the exchange rate fare during May 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 May 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	2025-26	2026-27
April	85.56	93.55	9.34	Depreciation	0.85	Depreciation
May	85.19	95.60	12.22	Depreciation	2.19	Depreciation
June	85.90	94.97	10.56	Depreciation	-0.66	Appreciation
July	86.11	95.82	11.28	Depreciation	0.90	Depreciation
August	87.52	95.47	9.08	Depreciation	-0.37	Depreciation

Rupee appreciated for the third straight month to May 2025 on a month-on-month basis but continued to depreciate on a year-on-year basis: INR appreciated vis-à-vis the US Dollar by 0.43 percent in May 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: According to a report by Bank of Baroda, the Indian rupee is expected to strengthen against the US Dollar in the near term due to imporved domestic fundamental with renewed inward investmnts by foreign instituions suppoted by favourable global trends like weak dollar and falling oil prices. The report projects rupee to trade in the range of 84 – 85 per US Dollar in the near trem but any escalation in US-China trade relation may pose significant threat to rupee.

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	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
June	83.47	85.90	2.91	Depreciation	0.83	Depreciation
July	83.59	86.11	3.01	Depreciation	0.24	Depreciation
August	83.90	87.52	4.31	Depreciation	1.64	Depreciation
September	83.81	88.32	5.38	Depreciation	0.91	Depreciation
October	84.03	88.42	5.22	Depreciation	0.11	Depreciation
November	84.36	88.83	5.30	Depreciation	0.46	Depreciation
December	84.99	90.09	6.00	Depreciation	1.42	Depreciation
January	86.26	90.80	5.25	Depreciation	0.79	Depreciation
February	87.05	90.77	4.27	Depreciation	-0.03	Appreciation
March	86.64	92.76	7.06	Depreciation	2.19	Depreciation

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 2025-26 depicted in the table below:

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

(US$ million)

Trade Flow	April	May	June	July	August
Engineering Export	10.4	12.31	11.48	12.24	12.32
Engineering Import	14.4	14.36	14.19	15.66	15.06
Trade Balance	-4.0	-2.05	-2.71	-3.42	-2.74

Source : DGCI&S

TO CONCLUDE...

After a remarkable growth phase, India’s engineering exports experienced a marginal decline of 0.82% for the first time in May 2025. During this period India’s overall merchandise exports also declined by more than 2%. While India’s engineering exports to US and EU grew, significant decline was noted in UAE, Saudi Arabia and Turkey, which are significant markets for India and feature prominently in India’s top 25 destinations. The decline can be explained by the growing geo-political tensions in the area and the rising threat to logistics. Exports of aluminium and its products was also hit due to increased competition in the ASEAN region. Decline was also noted in exports of metals like zonc and led and aircrafts, scpacecrafts and parts.

The global trade is currently going through a phase of uncertainty. The Euroean Central Bank has revised the global trade growth down by 0.4% to reach 3.1%. They have also revised down the global trade growth in 2026 to 1.7% after which it is expected to grow. The reasons behind this dismal trade performance is explained by the growing geopolitical tensions across Middle East and West Asia, policy uncertainty in the US and protectioist measures by some of the major markets. In these circumatsnces, India has to adopt a cautious approach. The guidance and support from the Ministry of Commerce and Industry would be crucial for the industry especially in developing new technologies in upcoming areas including rare earth magnets and exploring new markets.