India’s engineering goods exports touched a new high in July 2025, crossing the $10 billion mark for the first time in the current fiscal year. Shipments rose 13.81 per cent year-on-year to $10.43 billion, up from $9.16 billion in July 2024, driven by demand from the US, UK, Germany, Japan, Brazil, and China.
The robust performance came even as the global trade outlook remained clouded by tariff wars, policy uncertainty, and regional tensions. Engineering exports accounted for 28 per cent of India’s total merchandise exports in July 2025, up from 26.4 per cent a year earlier.
Major markets lift exports
Exports to the US rose 19 per cent year-on-year to $1.81 billion in July, while shipments to Germany jumped 37.8 per cent to $457.6 million. Exports to the UK surged 46.5 per cent to $402.5 million. Shipments to Japan and Brazil also witnessed double-digit growth, climbing 55.2 per cent and 26.4 per cent to $256.6 million and $227.8 million, respectively.
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Exports to China were up 35.8 per cent at $263.9 million during the month. Overall, 29 out of 34 engineering panels recorded positive year-on-year growth in July, with only five panels–including aircraft and spacecraft, ships and boats, and zinc products–showing a decline.
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Exports to Turkey, Gulf nations decline
Not all markets moved in the same direction. Exports to Turkey fell sharply by 31 per cent to $183.1 million in July 2025, compared to $265.8 million in July 2024, largely due to geopolitical tensions. The UAE, Saudi Arabia, and Singapore also reported contraction in shipments.
On a cumulative basis, India’s engineering exports during April–July 2025 rose 6.1 per cent to $39.34 billion, against $37.08 billion in the same period last year. Region-wise, North America retained its lead with a 22 per cent share in April–July, followed by the EU (18 per cent) and West Asia and North Africa (14 per cent).
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Tariff risks loom large
The growth momentum could face significant headwinds going forward, with the US administration imposing an additional 25 per cent tariff on Indian engineering goods effective August 27, 2025. The duty is over and above the 25 per cent tariff already levied, making many Indian products uncompetitive in the US market.
Commenting on the outlook, EEPC India Chairman Pankaj Chadha said: “The world is witnessing a realignment of supply chains and a growing inward-looking trade policy in major economies threatening established production networks. India also faces a huge tariff imposition from the US, which makes our future quite uncertain. We need to diversify our markets and products to survive and increase our global share.”
India is banking on a proposed bilateral trade agreement with the US to ease tariff concerns. However, dates for the next round of negotiations have yet to be finalised. Resolving the steep 50 per cent duty on Indian goods will be key to sealing the pact.
