India’s annual engineering exports to the US average around USD20 billion, which now face exposure to the 50 per cent tariff imposed by the Trump administration.
Photo: IANS
Driven by higher shipments of automobiles, auto components, industrial machinery, and select basic metals, India’s engineering goods exports grew 4.91 per cent year-on-year in August 2025 to USD 9.9 billion, compared with USD 9.4 billion in the same month last year.
The US remained the top destination, with exports rising 7.2 per cent year-on-year to USD 1.68 billion. However, on a month-on-month basis, engineering exports fell nearly 5 per cent from July’s record USD10.4 billion, which analysts say could be an early sign of stress due to tariff escalations imposed by the US.
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India’s annual engineering exports to the US average around USD20 billion, which now face exposure to the 50 per cent tariff imposed by the Trump administration.
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Commenting on the performance, Pankaj Chadha, Chairman of the Engineering Export Promotion Council (EEPC) India, said the August growth was “very encouraging” for the industry, given challenges such as reciprocal tariffs from the US, high logistics costs, and geopolitical tensions.
“This is a significant achievement for the exporting community. The FTA signed with the UK will boost our market presence there, while the ongoing negotiations with the EU must address non-tariff barriers like CBAM to make the agreement truly effective. We also urge the government to support better marketing of Indian products abroad, since diversification of products and destinations is the key,” Chadha said.
He added that government support is critical to tackle issues such as export credit, rising raw material costs, and escalating freight charges.
Among key markets, the UK, Germany, the UAE, Italy, South Africa, Bangladesh, France, and the Netherlands registered positive growth in August. However, shipments to China fell 7.4 per cent to USD 242.5 million, while exports to Turkey dropped 42.3 per cent to USD 162 million. Exports to Indonesia plunged 65.6 per cent to USD 103.6 million, while shipments to Singapore and Saudi Arabia also saw sharp declines.
On a cumulative basis, engineering exports rose 5.86 per cent year-on-year to USD 49.24 billion in April–August 2025, compared with USD 46.52 billion in the same period last year. The share of engineering goods in India’s total merchandise exports stood at 28.2 per cent in August, up from 28 per cent in July and 26.74 per cent during April–August of the previous fiscal.
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In August, 27 out of 34 engineering product panels reported positive year-on-year growth, led by automobiles and auto components, which surged 21percent to USD 2.38 billion. However, exports of nickel products, electrical machinery, aircraft and spacecraft, ships and boats, medical and scientific instruments, and cutting tools declined during the month.
Cumulatively, 28 of the 34 panels posted positive growth in April–August 2025-26, while six—including non-ferrous sectors, aircraft and spacecraft, and ships—registered declines.
Region-wise, North America remained the largest export destination with a 21 per cent share, followed by the EU (18 per cent) and WANA (West Asia and North Africa) at 14 per cent.
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