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-February 2026 as compared to April-February 2025

Note: Myanmar has been included in ASEAN and not in South Asia, since ASEAN is a formal economic grouping.

Region-wise observations for April- February 2025-26:

In April-February 2026, all regions recorded export growth barring WANA (3.8% decline), Other Europe (4.2% decline) and CIS (5.4% decline).

WANA

• Also, it needs to be noted here exports in both WANA became positive in February 2026 – during this time, exports to WANA grew by 3.7%
• The West Asia Crisis has created serious disruptions for Indian exporters exporting to the WANA region – future exports to the region may get significantly affected

Other Europe:

• The decline is mainly due to declining exports to Turkey – in April-February 2025-26, India’s exports to Turkey came down by 36% from USD 2.79 billion to USD 1.77 billion
• Needs to be noted here, in February 2026, exports to Other Europe became positive – this is due to significant export growth to the UK especially since the FTA. In April-February 2025-26, India’s engineering exports to UK rose by 20% from USD 3.5 billion to USD 4.3 billion

CIS:

• The decline in exports to the CIS region is mainly due to decline exports to Russia, the largest export destination in the region. Apart from the issue with sanctions, depressed domestic demand in Russia is also another reason for declining exports

Other observations:

• North America continued to account for the largest share of Indian engineering exports (20% share) followed by EU (18%), WANA (15%), ASEAN (11%) and North East Asia (8%)
• Country-wise, USA continued to remain the top destination for Indian engineering exports in April-February 2026 as it recorded an export of 17.77 billion. The y-o-y growth from USA is recorded at 2.9%
• Decline in exports was majorly noted in UAE and Saudi Arabia – the decline can be attributed to significant fall in exports of aircraft, spacecraft and parts (-98%)
• Decline in exports was also noted in Mexico (-4.4%), France (-7.3%), Turkey (-36.3%), Bangladesh (-10.7%) and Indonesia (-18.8%)
• The decline in Mexico can be explained by their recently announced trade reforms under which tariffs on over 1,400 products rose sharply—ranging from 5% to 50%—for imports from countries without a Free Trade Agreement (FTA) with Mexico effective from 1^st January 2026
• The decline in Bangladesh can also be explained by recent tax reforms whereby Bangladesh has withdrawn the existing import duties on steel raw materials and replaced it with a combination of VAT and Advanced Income Tax (AIT) which has increased the effective tax burden on manufacturers using imported steel for further processing by upto 40%. Even in cases of products with zero customs duty, the additional duties increase the cost burden.
• Significant double-digit export growth was noted in Vietnam (38%), China (25.4%), South Korea (19.3%), UK (20%) and European countries including Netherlands (17.8%), Italy (16.9%) and Spain (28.4%)

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Sectoral Observations:

India’s engineering exports grew by about 5.25% in April–February 2025-26 to around US$111.5 billion, with mixed performance across panels:

a) Exports of iron and steel rose by 11.5% during April–February 202526, supported by higher shipments of primary steel, while products of iron and steel grew at a slower 5%. Overall, India’s steel exports rose 8% to US$18.96 billion during April–February 202526, supported by strong demand from the USA, UAE, EU markets (Italy, UK, Belgium, Germany, Netherland, Spain), Nepal and select WANA destinations (Saudi Arabia, Oman), Turkey from other Europe, etc .

As reflected in the Ministry of steel figures, India’s crude steel production rose sharply by 11.2% yearonyear during April-Feb 2025-26, supported by a 10.4% increase in finished steel production as well as 7.2% increase in finished steel consumption. Therefore consumption grew at a slower pace due to disrupted construction and infrastructure activity—the country’s largest steelconsuming segments. The growth figures highlights India's resilience and continued strength in steel production despite global fluctuations.

b) The non-ferrous metals panel emerged as a major growth driver, with exports rising by 17.4% to US$12.67 billion during April–February 202526. Among which,

1. Aluminium and aluminium products witnessed a growth of 3% to US$6.36 billion in April-Feb 2026 from US$6.2 billion during April-Feb 2025. Export performance was supported by stronger shipments to USA, Korea Rp, Vietnam, China, Japan, Italy and Malaysia although declines were observed in markets such as Korea (Rep.), Mexico, Netherland and Turkey. On the pricing front, BigMint data indicates that domestic aluminium prices in India firmed up week?on?week, reflecting the rise in LME and MCX aluminium futures amid ongoing global supply concerns. Aluminium P1020 prices in India are expected to remain muted in the near term due to steady demand, moderated premiums, while global premium negotiations and easing LME volatility may continue to influence market sentiment.

       2.Copper and copper products registered a robust 53% increase, rising to US$ 3.22 billion from US$ 2.11 billion. Export growth was supported by strong demand from Saudi Arabia,                  China, USA, Korea (Rep.), the UAE, key EU markets,Malaysia and Nepal, although decline observed in Malaysia.

      3. On the pricing front, BigMint data shows that India's copper scrap imports fell 27% m-o-m in February 2026 from January 2026, marking the lowest level in nearly a year. The decline could be attributed to holiday-related slowdowns in major supplying countries, which temporarily constrained shipments to India. Notably, with scrap availability tightening, Indian buyers shifted towards sourcing refined copper cathodes, resulting in a sharp increase in imports. India's copper cathode imports doubled in February compared to that of January. Shipments from China surged, marking an increase of over 2,500%, making the country the largest supplier of cathodes to India this month. The surge was driven by competitive pricing from Chinese smelters amid ample domestic refined copper availability. End-user demand is set to improvefrom April, which could lift procurement of copper products despite elevated freight and insurance costs. However,if logistics costs remain high, Indian buyers mayprefer sourcing copper cathodes if they are competitively priced.

      4.Lead and lead products rose significantly to US$1.16 billion (+39%), while tin products expanded to US$43 million (+120%), albeit on a low base.

c) Exports of industrial machinery increased by 11% to US$20.15 billion during April–February 202526, driven by strong demand for Industrial Machinery like Boilers, Air-condition and Refrigeration machinery, Machine tools, reflecting rising global investment in automation and manufacturing. However, exports of IC engines and parts grew only moderately.

d) Exports of electrical machinery grew by 8% to US$14.03 billion, supported by demand for power equipment, switchgear, and transmission-related products.

e) The automobile sector recorded robust growth of 15.4%, with exports reaching US$24.44 billion, led by South Africa, Mexico, Saudi Arabia, UAE, Japan, Brazil, Germany and Colombia and, reflecting sustained demand for vehicles and components. In South Asia, a strong rebound in Bangladesh, Sri Lanka and Nepal boosted exports. However, shipments to USA, Turkey and Indonesia decelerated

f) Exports of other engineering products rose by 11% to US$14.29 billion, supported by strong growth in office equipment, railway transport equipment, construction machinery, bicycle parts. In contrast, medical and scientific instruments witnessed a decline of 1% during April-February 2025-26.

Source : DGCI&S

State wise engineering export performance- Data as on 2025-26

Note: DGCI&S State figures are updated till the month of January 2026

The table below indicates the exports from top Indian states. It is evident from the table that almost 95% of India’s exports is contributed by the listed 12 states. Within this almost more than 60 percent of exports is done by Maharashtra, Tamil Nadu and Gujarat together during April-January 2025-26

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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 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 two month of fiscal 2025-26 saw engineering export growth and manufacturing output growth moved in the opposite direction. In April, engineering export growth surged to double digit and manufacturing growth decelerated, while in May engineering export declined and manufacturing output growth inched up over the month. Then, In June, July and August 2025 however, both moved on the same direction. In June and July, both witnessed improvement in growth while in Aug 2025, both conceded moderation in growth. In September 2025 however, engineering growth continued to slowdown but manufacturing growth accelerated. Both engineering growth and manufacturing growth moved in the same direction during October to December 2025. October 2025 saw both going down with decline in engineering exports while Novbemebr 2025 witnessed surged in both with substantially higher growth. In December 2025 however, while engineering exports grew, the growth rate slowed down whereas the manufacturing growth rate was maintained. The month of January 2026 however saw scceleration in engineering export growth but moderation in manufacturing output growth.

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.