India’s export of engineering goods to China declined in October 2023, even as the shipments surged to as many as 18 countries, including the US, UK, and Germany, out of the 25 top destinations that globally recorded positive growth last month. During this period, engineering exports to China dipped 6.4 per cent year-on-year (yoy) to USD 213.2 million.
After a slump in the first half of this year, India’s engineering exports continued to record positive year-on-year growth for the third straight month in October 2023, soaring up to USD 8,094.20 million from USD 7,550.69 million in October 2022, registering 7.2 per cent growth yoy, with a lower base of the previous fiscal contributing to this growth. Product groups namely ‘products of iron and steel’, ‘copper and products’, ‘electric machinery’ etc. recorded higher shipment while exports of ‘iron and steel’ and ‘aluminium and its products’ declined.
The value of engineering exports to the US in October 2023 was USD 1391.5 million, up 2.2 per cent yoy against USD 1,361 million in October 2022. The engineering exports to the UAE rose 2.9 per cent yoy to USD 348.6 million in this period. Engineering exports to the UK saw a 60.3 per cent yoy jump at USD 302.5 million in October 2023. At USD 342.7 million, engineering goods exports to Germany in October 2023 were higher by 20 per cent (yoy).
“The slump in the demand in developed countries especially the European Union has caused issues for Indian metal exporters. The situation has been further worsened by the various market access barriers that countries in EU and North America are imposing on Indian exporters,” says Chairman EEPC India, Arun Kumar Garodia. Among the other countries which saw a decline in engineering shipments from India during this period were Italy, Singapore and Indonesia. Engineering exports to Indonesia plummeted 18.2 per cent in October to USD 122.9 million. Region-wise, positive year-on-year growth in October 2023 was observed in North America, SSA, WANA, NE Asia, SSA, CIS, South Asia, Other European countries and Latin America, while EU countries and ASEAN reported declines.
“Raw material prices have been a major pain point for the downstream engineering industriesm,” agrees Garodia who has also urged the government for more support to help the industry stay competitive in the global market.
“The price analysis indicates that Indian metal prices have gone up compared to international prices. Concerted support in these areas is extremely important for the steady growth of engineering exports from India,” he said.
The share of engineering exports in India’s total merchandise exports was recorded at 24.11 per cent in October 2023, while the cumulative share was higher at 25.17 per cent during April-October 2023-24. Cumulative engineering exports for April-October 2023-24 were down by 1.61 per cent as they declined to USD 61.63 billion from USD 62.63 billion during April-October 2022-23. On a cumulative basis, 21 out of 34 engineering panels recorded positive growth during April-October 2023-24.