With demand from the top three key markets USA, China and UAE remaining strong, engineering goods exports crossed the $101 billion-mark during the April-February period of the current financial year registering nearly 50% growth over the same period last year.
In April-February 2021-22, the share of engineering goods in total merchandise export was 26.94%.
On the back of strong recovery seen in the advanced economies, pent-up demand, rise in commodity prices and government push to boost exports among others, India’s engineering goods exports are on track to surpass the $107 billion target set for FY22.
At $101.7 billion worth of exports in the first 11 months of the financial year, more than 94% of the target is already achieved.
“Given the fact that exports generally exhibit an upward trend in the last quarter of any financial year, engineering exports is expected to over-achieve its target within stipulated time,” said EEPC India Chairman Mr Mahesh Desai.
He further said that global trade has also shown an upward trend post-pandemic and as per UNCTAD Global trade in 2021 reached a record high figure of $28.5 trillion, which is almost 13% higher than even the pre-pandemic levels.
“Concerns have, however, been raised by some experts that factors such as the ongoing Russia-Ukraine conflict, inflation pressure in the US and real estate instability in China would have a dampening impact on trade growth. Resurgence of COVID cases in China in the recent month is expected to create further disruption in global supply chains,” Mr Desai said.
“{Given the above forecast, India needs to practice caution and increase its export competitiveness in areas which drive the global supply chains. This will enable the country to plug in the supply chain gap created by China and enhance our presence in the global trade platform,” EEPC India Chairman added.
Meanwhile, India’s engineering exports recorded 33.31% YoY growth in February 2022 by climbing up to $9.4 billion from $7.05 billion in February 2021.
As many as 31 out of 34 engineering product panels witnessed positive YoY growth during February 2021. Only `Ships, boats and floating structures’, ‘Project Goods’ and ‘Industrial Machinery like Boilers, parts, etc’ conceded decline in YoY exports during February 2022.
Export to all the regions grew YoY in February 2022 other than Sub-Saharan Africa.
Other than Nepal and Indonesia, all other 23 key markets for Indian engineering goods witnessed positive growth during the month of February.
The US continued to be on top with total engineering exports rising 46% year-on-year to $1.5 billion in February, 2022. In cumulative terms, engineering exports to the US grew 52% to $15.3 billion in the April-February period of the current financial year as against $10 billion in the corresponding period last year.
Exports to China in the month of February this year was $290.7 million, up 19% compared to $244 million in February, 2021.
Another key market UAE saw 76% jump in shipment of engineering goods from India during February, 2022. During the month, exports to the UAE were $429.4 million compared to $244 million in February, 2021.
The top 25 countries contribute to more than 75% of total engineering exports from India. Other than the US, China and UAE they include Germany, Italy, Singapore, Saudi Arabia, Japan, Thailand and Bangladesh.
North America, European Union and ASEAN are top regions in the world for Indian engineering exports.
Among various product panels of engineering exports, iron & steel and its products recorded 54% year-on-year growth in February 2022 to $2.57 billion as compared to $1.62 billion in the same month previous year.
Exports of Non-Ferrous Metals and Products were $1.28 billion in February 2022, up 61% compared to $798.6 million in the corresponding month last year.
Industrial machinery segment saw an 18% year-on-year jump in exports in February to $1.47 billion. Trends in the auto and auto components segment were also impressive with total exports in February rising 29% to $1.82 billion.
As per EEPC India analysis of engineering export numbers, the trend in exports of ‘aircraft, spacecraft and parts’ was positive in February with exports rising 36% to $105.2 million. The ‘ships, boats and floating structures’ segment witnessed 68% year-on-year decline in exports in February.
• In April-February 2021-22, the share of engineering goods in total merchandise export was 26.94%.
• India’s engineering exports recorded 33.31% YoY growth in February 2022 by climbing up to $9.4 billion