Kolkata / New Delhi, June 28 (Agency) Driven primarily by demands from countries such as the US, Turkey, Saudi Arabia, and the UAE, Indian engineering exports bounced back in May 2024 and recorded 7.39 percent year-on-year growth to USD 9.99 billion, EEPC India said on Friday. In April, engineering exports registered a 4.49 percent decline compared to the year ago figure. Significant export growth was noted in West Asia and North Africa (WANA), Latin America, and European countries outside the European Union (EU) during May. Exports to the EU declined significantly during this period. “Overall, engineering goods exports revived in May this year compared to the previous month and we are hopeful that the positive track will continue despite global geo-economic concerns. We also hope that the Government will continue to support us in our future endeavors, especially in the upcoming budget,” said EEPC India Chairman Arun Kumar Garodia.
Among the top 25 countries that contribute almost 76 percent of total engineering exports from India, positive growth was seen in the case of 15 countries in May this year. Engineering exports to the US, India’s top export destination, rose 14.4 percent year-on-year in May 2024 to US$ 1.65 billion as against USD1.5 billion in May 2023. Engineering exports to Turkey more than doubled to USD 457.5 million in May 2024 as compared to USD 222 million in May 2023. Engineering exports to Saudi Arabia and the UAE registered 81 percent and 43.2 percent year-on-year growth respectively in May. In May, engineering exports to China recorded 13 percent year-on-year growth to USD 218.6 million. The growth in May this year was mainly on account of the positive performance of the machinery and automobile sectors.
However, there was a decline in metal exports especially that of iron and steel, aluminum, copper, and nickel. The sharp decline in exports of metal items is chiefly due to increased competition from China which is undergoing a decline in domestic demand and is flooding the global markets with cheaper metals, especially the markets in South East Asia and the Middle East. Indian metal producers are also facing certain market access issues in developed countries such as those in the EU and North America. Additionally, domestic demand in India has also been on the rise.
All these factors have impacted the metal exports from India. “In this situation, inclusion of steel in the Remission of Duties and Taxes on Exported Products (RoDTEP) scheme may provide greater incentive for steel exporters in India,” Garodia stated. Excluding the export of iron and steel, engineering exports recorded a much higher growth both on a monthly as well as a cumulative basis. Exports of Iron and Steel conceded a 39 percent year-on-year decline in May 2024 and around 38 percent year-on-year decline during Apr-May 2024-25. According to the Quick Estimates of the Department of Commerce, Government of India, the share of engineering exports in India’s total merchandise exports during May 2024 was recorded at a higher 26.61 PC as against 24.76 percent in April 2024. On a cumulative basis, the share was 25.51 percent during April-May 2024-25. In May, as many as 23 out of 34 engineering panels witnessed positive year-on-year growth, while 11 remaining engineering panels experienced a decline. Exports of Iron and Steel, Non-Ferrous products including Copper, Aluminium, and Nickel products, and Other products including Medical and Scientific Instruments, Railway transport, and Office Equipment dropped.
On a cumulative basis, 22 out of 34 engineering panels recorded positive growth and the remaining 12 engineering panels including Iron and Steel, Products of Iron and Steel, some non-ferrous sectors including Aluminium, Zinc, Nickel, and products, Pumps of all types, Other products including Medical and Scientific Instruments, and Office Equipment recorded negative growth during April-May 2024-25. Region-wise, North America and the EU remained India’s topmost destinations for engineering exports with a share of 21 percent and 17 percent respectively, in India’s total engineering exports. Other Europe registered the highest growth of 26.3 percent during April-May 2024-25 vis-à-vis the same period last year followed by WANA (growth of 25.7 percent), CIS (growth of 18.5 percent), North America (growth of 9.7 percent). Cumulative engineering exports were recorded at a higher USD 18.54 billion during April-May 2024-25 as against USD 18.25 billion during the same period of 2023-24, registering an increase of 1.57 percent.