Engineering exports recorded more than 10% growth in January 2026 after registering marginal growth last month

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

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

• In April-June 2025, Italy, USA and Nepal ranked as the top three 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 5% shares, respectively.

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

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

• USA, UK, Singapore and Germany were the top importers of Indian Electrical Machinery & Components during the same period with  21%, 11%, 11% and 7% shares respectively.

• USA, France,UK, Germany and Singapore were the top importers of India's Aircrafts and Spacecraft during April-June 2025, making up to 69% of India’s total export of Aircrafts and Spacecraft
• For the auto components’ product group, USA remained the top importer in April-June 2025 followed by Germany, Brazil, Bangladesh and UAE, making up to 42% of India’s total export under this category.

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

Reasons for Decline (As per April-June 2025-26):

Aluminium:

• Aluminium exports continue to decline in June 2025  cumulative decline in the first three months of the current fiscal was around 14%.
• Decline in exports to China by almost 42%. This is mainly due to decline in Chinese demand. As per China’s trade statistics, China’s import of aluminium and its products declined by almost 84% between April-June 2024 and April-June 2025
• While China is the largest producer of aluminium globally and there is significant downstream demand. However, recently China’s production has been increasing. According to Shanghai metals Market from 2004 to 2024, China’s aluminium production increased sixfold to reach 44 million mt/year by 2025

• Decline in exports to the ASEAN region (-26%) due to mainly decline in exports to Vietnam, Malaysia and Indonesia. The decline in ASEAN can be explained by rising aluminium production capacity in the region - Indonesia is focussing on expanding its overall capacity and supply chain. As of 2025, Indonesia has 11 alumina projects under construction or planned, with a total capacity of 25.5 million mt. Other such investments in both alumina and aluminium projects are being planned. On the other hand Malaysia is focusing on expanding its smelting capacity. Also, changes in policy in China towards green production process, scrap generation is also increasing in ASEAN
• Significant decline was also noted in Russia (-92%) and Turkey (-71.9%) and EU (-10.1%) mainly due to the ongoing geopolitical conflicts and related logistical issues in the Middle East and West Asia region.
• The decline in Bangladesh (-25%) is mainly due to export restrictions put by both countries
• Another major reason behind India’s falling aluminium exports is the rising domestic demand – as per latest report, India’s domestic aluminium demand experienced a growth, especially in the secondary aluminium sector prices rose due to growing demand and inadequate supply

Zinc:

• The decline in Zinc exports is primarily due to global supply exceeding demand. As per the International Lead and Zinc Study Group, the global market for refined zinc metal was in surplus by 151kt over the first four months of 2025
• Decrease in usage of refined zinc metal was noticed in Brazil, Germany, South Korea, Turkey and USA. While there was some increase in demand from China, France and India. However, China’s net imports of refined zinc metal totalled 120kt, a reduction of 19kt compared to the first four months of 2024
• As mentioned above there is also substantial domestic demand

Nickel:

• The decline in India’s Nickel exports is mainly due to rising domestic demand especially in the EV and renewable sector and also rising geopolitical tensions affecting exports to CIS region, Middle East and Europe. In the Eastern side increase in capacity in South East Asia has also affected India’s exports to the region

Source : DGCI&S

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

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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 monthswhile in each of fiscal 2022-23 and 2023-24, as many as10 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. In May 2025 however, both decelerated. Engineering export growth turned negative and manufacturing output growth moderated.

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.