Mr. Pankaj Chadha

Chairman

 As we enter a new calendar year in 2025, Indian engineering exports continued its remarkable growth journey for the seventh straight month in the fiscal 2024-25 – in November 2024-25, India’s engineering exports reached USD 8.89 billion registering a growth of 13.75 percent over the same period last year. In cumulative terms too that is April-November 2024-25, engineering exports recorded a Y-o-Y growth of USD 8.87 billion. The growth recorded in November 2024 has been spearheaded by exception increase in exports of aircrafts, spacecrafts and parts and ships, boats and floating structure. Double-digit growth was also noted in electrical machinery and equipment. It is also worth mentioning here that after October 2024, India’s iron and steel exports turned positive for the second straight month in November. Also, in terms of region, export growth was recorded in North America, EU, Western Asia and Northern Africa (WANA), ASEAN, Sub-Saharan Africa, Other Europe and Latin America. This performance has been possible due to the relentless efforts of our exporting community especially when they are facing numerous international issues – the protectionist policies in EU in the form of safeguard measures, CBAM, Section 232 tariffs in USA, the geopolitical conflicts leading to logistical crisis such as the Red Sea Crisis. At the domestic font rising raw material prices especially that of steel is also acting as a barrier for the Indian exporting community. Despite these challenges they have been able to record growth in exports – I would like to take this opportunity to congratulate them and sincerely wish that the growing trend continues in the coming months of 2025.

It is also important to mention here that the growth in engineering exports have been surpassing India’s overall merchandise exports growth in the past few months. This is also an important achievement – as the largest foreign exchange earner, the industry is leading from the front.

Globally, trade has also recorded positive growth of 3.3% which was mostly driven by services. Global merchandise trade grew by 2% which is slower than that of the services trade. In recent times, global growth has been spearheaded by the developed nations as countries such as Japan, USA and the EU recorded significant export growth. By contrast, some decline was noted in the exports recorded by the developing nations including China and India. The recent UNCTAD Trade Update published in December 2024 mentions that 2025 remains uncertain due to anticipations regrading USA’s policy shift including broader tariffs that could disrupt global value chains and impact key trading partners. India is considered among the countries which are most likely to face high trade barriers from the USA. Hence the exporting community need to prepare themselves in anticipation.

 

What is our way to progress in this difficult situation: The support from the government would also be critical in these challenging times especially in easing the domestic steel prices - Steel constitutes up to 60% of the production cost in most engineering sectors, making affordability a decisive factor. Further support is needed for energy audits especially after the implementation of CBAM - Conducting energy audits is crucial for understanding and mitigating carbon emissions. However the associated cost is significant and poses a burden for exporters especially the MSMEs. Government’s financial support in this field can facilitate the transition towards cleaner production practices and ensure that smaller businesses are not unduly strained. Apart from this, designing and developing a comprehensive trade repository for exporters and overseas buyers will enhance ways to boost exports under the initiative of “Brand India”. We would also urge the government to help us coordinate with the Indian Missions abroad for understanding the markets. There is very limited knowledge of what quality standard are required in a particular country because the quality standards are not static, they are evolving with time. So, we need to have a shared database around the quality standards. Finally, technological innovation is becoming one of the mainstays of engineering industries worldwide. There is requirement of paradigm shift, necessitating an elevation in technology among the domestic engineering exporters to enhance their competitiveness and climb up the value chain.

 

Finally, as the largest export promotion council and the representative of the Indian engineering export industry EEPC is also taking initiatives to market Indian products abroad. In this month with the support of the government of India, we are conducting the Bharat Mobility Show from 17th to 25th January 2025 at Pragati Maidan in Delhi. This is happening for the second time in India and is also the leading global mobility show in India. I sincerely wish the team all the success for conducting the event. Apart from that in January, EEPC India is also participating in international shows including Arab Health to be held in Dubai from 27th January. I believe that such shows will play a key role in establishing the “Brand India” abroad.