India’s engineering exports to US rise in May despite tariff challenges

By Admin

30 Jun, 2025

Resilience in US-bound exports

India’s engineering goods exports to the United States registered a notable 4.6% increase in May 2025, reaching $1.74 billion, even amid ongoing uncertainties over tariff-related policies introduced by former President Donald Trump. This growth highlights the resilience of India-US bilateral trade, especially in high-value engineering segments, which have shown strength despite policy headwinds.

European demand helps offset Middle East decline

While the US continues to serve as a strong export partner, India’s engineering shipments also witnessed positive trends in key European markets. Exports to Germany, the United Kingdom, and the Netherlands recorded healthy growth, partially offsetting a sharp decline in exports to Middle Eastern economies such as the UAE, Saudi Arabia, and Turkey.

Geopolitical pressures affect Middle Eastern trade

Commenting on this development, Pankaj Chadha, Chairman of EEPC India, noted that the fall in engineering exports to the Middle East was primarily due to rising geopolitical tensions and logistics chain disruptions in the region. Additionally, aluminium exports came under pressure from intensifying global competition, further dampening trade performance in certain sectors.

Slight overall decline but strong sectoral presence

Despite positive showings in North America and Europe, the overall engineering exports in May slightly dipped by 0.82%, standing at $9.89 billion. Still, engineering goods cemented their role in India’s export mix, making up 25.53% of total merchandise exports in the month   a sign of India’s expanding manufacturing base and the global appetite for technology-driven Indian products.

Cumulative exports show robust growth

On a cumulative basis, engineering exports rose 4.77% year-on-year, climbing to $19.40 billion in April–May FY 2025–26, compared to $18.52 billion in the same period last year. The surge was especially strong in April 2025, which saw an 11.28% jump, reaching $9.51 billion.

Category-wise performance: mixed signals

Out of 34 engineering export categories tracked in May, 26 segments showed positive growth year-on-year. However, exports of machine tools, aircraft and spacecraft components, ships and boats, and certain non-ferrous metals like aluminium and zinc recorded declines.

North America leads as top destination

Region-wise, North America remained India’s top destination for engineering exports, accounting for 21.3% of total shipments, followed by the European Union (17.7%) and the West Asia and North Africa region (14.3%).