India’s engineering exports to US touch $1.62 billion in Jan but tariff wall looms ahead

New Delhi  (The Uttam Hindu): India's engineering goods exports have recorded robust growth in January this year despite uncertainties in the global markets, with the United States being the top destination. The country’s engineering goods exports to the US recorded an 18 per cent year-on-year growth in January to touch the $1.62 billion mark. Total exports of engineering products during the month recorded a 7.44 per cent growth at $9.42 billion in January 2025, compared to $8.77 billion in the same month last year, according to figures compiled by the Engineering Exports Promotion Council (EEPC).Despite geopolitical tensions and growing trade protectionism, India's engineering exports have maintained positive growth for the ninth consecutive month, an EEPC statement said. EEPC India Chairman Pankaj Chadha said: "Engineering exporting community has managed to record positive growth despite significant global turmoil in the form of continuing conflicts and increasing protectionism by some of our major export destinations."

His statement comes at a time when American President Donald Trump has announced a hike in the tariff on Indian exports from April 2 as part of what he calls a reciprocal tariff policy. "Global exports seem to be at the crossroads of major changes with new geopolitical challenges. Trade policies worldwide are evolving to address national concerns, but they are putting unprecedented pressure on businesses," Chadha said. Chadha cautioned that the latest US tariffs highlight the challenges exporters are likely to face in the coming days, adding that continuous government support in export credit and technology would be critical to maintaining competitiveness. Globally, more than 3,000 trade restrictions were implemented in 2024 alone, posing risks to the multilateral trading system, according to the Global Trade Outlook 2025 published by the International Chamber of Commerce (ICC), he added. India's top engineering export destinations like Germany, Mexico, Turkey, South Africa, France, Japan, Nepal, and Bangladesh registered positive growth in January. However, shipments to the UK, Saudi Arabia, Malaysia, China, Italy, and Spain recorded negative growth. Indian engineering exports continued their year-on-year growth streak for the ninth straight month in January, but the growth rate moderated to 7.44 per cent from 8.32 per cent in December, the EEPC said. January growth was primarily driven by exports of aircraft, spacecraft and parts, electric machinery and equipment, automobile and auto components, industrial machinery, products of iron and steel, and medical and scientific instruments, it added. Cumulatively, engineering exports during the April-January period of FY25 stood at $96.75 billion, reflecting a 9.82 per cent growth over $88.10 billion in the same period last year.

The share of engineering goods in India's total merchandise exports was 25.86 per cent in January and 26.96 per cent in the April-January period of FY25, according to quick estimates from the Department of Commerce, it said. Engineering is the largest industrial sector in India and accounts for 3.53 per cent of the country's Gross Domestic Product (GDP). The country's engineering sector comprises manufacturing iron, steel, related products, non-ferrous metals, industrial machinery, automobiles, auto components, and other engineering products. India became a permanent Washington Accord (WA) member in June 2014. It is now part of an exclusive group of 17 countries that are permanent signatories of the WA, an elite international agreement on engineering studies and the mobility of engineers. India's engineering sector has witnessed remarkable growth over the last few years, driven by increased investment in infrastructure and industrial production.