During April-February 2023-24, India witnessed a notable surge in exports of engineering goods to Russia, nearly doubling from the previous year, alongside increased shipments to key free trade partners such as the UAE and Australia. Despite an overall decline in goods exports during this period, the engineering segment managed to achieve a modest growth of 1.23 percent, reaching $98.03 billion. The growth was attributed to the successful rupee payment mechanism implemented to counter economic sanctions against Russia, facilitating a significant increase in Indian engineering products imported by Russia.
In February 2024, engineering exports reached $9.94 billion, marking the highest growth rate of 15.9 percent for the fiscal year 2023-24. Notably, the figure was the second highest export recorded in that fiscal year, following December 2023. While exports to traditional markets like the US and China experienced declines, shipments to emerging markets like the UAE and Saudi Arabia surged, showcasing diversified trade patterns.
Engineering exports to the US declined by seven percent to $15.95 billion, while exports to China decreased by one percent to $2.38 billion during April-February 2023-24. In contrast, exports to the UAE rose by sixteen percent to $5.22 billion, making it the second-largest market for Indian engineering goods. Saudi Arabia emerged as the third largest market, witnessing a substantial spike of 75 percent in exports to $4.62 billion.
India’s focus on strengthening trade relations with countries like Australia resulted in a five percent increase in engineering exports, reaching $1.3 billion during the same period. Despite a slight downturn in February 2024, the overall share of engineering exports in India’s total goods exports increased to 24.01 percent, reflecting the resilience of this sector amidst challenging global trade conditions.
The effectiveness of free trade agreements, particularly with the UAE, and ongoing negotiations with GCC countries contributed to the expansion of India’s engineering export market in West Asia and North Africa. However, certain sub-sectors within the engineering domain experienced fluctuations, with notable declines observed in exports of zinc and nickel products, motor vehicles, railway transport parts, ships, boats, and office equipment. As reported by businessline, overall, India’s engineering export sector demonstrated resilience and adaptability in navigating the complex global trade landscape, contributing significantly to the country’s export performance despite the broader economic challenges.
