Engineering exports dropped 4.16 per cent in May 2023 (year-on-year) to $9.3 billion as shipments to key markets like the US and China continued to decline, but there was a substantial increase in exports to new Free Trade Agreement partner countries, the UAE and Australia, as per an EEPC India analysis.
“Engineering exports from India continued to decline for the second straight month in fiscal 2023-24, but the decline was slower at 4.16 per cent (year-on-year) in May as against 7.26 per cent in April. Cumulative engineering exports declined by 5.71 per cent to $18.28 billion in April-May 2023-24,” the report pointed out
Steel continued to be the main spoilsport that contributed to the decline in engineering exports. “Exports of base metals as a whole declined except for copper. A substantial drop in shipment to North America, Sub-Saharan Africa, and the EU was also attributed to the decline in overall engineering exports,” it said.
Engineering exports to the US in May 2023 fell 19.6 per cent to $1.44 billion as there was a sharp drop in domestic demand, accompanied by fears of an impending recession, the report noted.
Exports of engineering goods to China continued to witness a sharp decline, falling 10.5 per cent to $193.1 million.
On the other hand, engineering exports to the UAE and Australia, the countries with which India recently concluded free trade pacts, increased in May 2023. While engineering exports to the UAE rose nearly 32 per cent to $567.1 million during the month, shipments to Australia increased 17.4 per cent to $112.9 million.
Region-wise, positive year-on-year growth was noted mainly in WANA, CIS, and Oceania. Regions witnessing a drop in exports during May 2023 include North America, ASEAN countries, EU countries, Sub-Saharan Africa, and South Asia, the report said.
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