Engineering exports got benefits from FTAs, helps to double shipments to Russia : EEPC
NEW DELHI : Exports of Engineering goods this year have benefitted from the FTAs with UAE and Australia and change in direction of trade flows brought about by the geo-political realignments.
While engineering exports to the UAE rose 16% year-on-year to $ 5.22 billion in the current fiscal till February, shipments to Australia increased 5% to $ 1.30 billion during this period.
While Russia has become a major trading partner in the last two years largely due to imports of petroleum crude, engineering exports to the country have doubled during April-February this year to $ 1.2 billion as compared to the same period last year.
The US, however, still remains the biggest market for the sector but the shipments to that market declined 7% to $ 15.9 billion.
Among other key markets, India’s engineering goods exports to China witnessed a marginal decline in FY24 till February at $ 2.38 billion as against $ 2.40 billion in the corresponding period of the previous financial year.
Overall, engineering exports entered the positive growth zone by February stood at $ 98.03 billion as against $ 96.84 billion during April-February of last year, securing 1.23% growth.
“The FTA with UAE and the negotiations with GCC have been quite effective as West Asia and North Africa’s share in India’s engineering export basket increased to 15% from 12% last year. This performance has been possible despite the difficult global trade situation,” Chairman of Engineering Export Promotion Council Mr. Arun Kumar Garodia said.
“We are optimistic that FTAs with the UK, Oman, and the EU would be signed sooner than later. This will significantly help the engineering sector grow its share in the global market,” he added.
The share of engineering exports in India’s total merchandise exports increased to 24.01% in February 2024 from 23.75% in January 2024. On a cumulative basis, the share was 24.82% during April-February.
In February 2024, as many as 28 out of 34 engineering panels witnessed positive year-on-year growth, while 6 remaining engineering panels experienced a decline. Exports of zinc and products, nickel and products, motor vehicles and cars, railway transport and parts, ships and boats, and office equipment dropped.
On a cumulative basis, as many as 20 out of 34 engineering panels recorded positive growth and the remaining 14 engineering panels including iron and steel, some non-ferrous sectors including aluminium, zinc and nickel, industrial machinery and automobiles recorded negative growth during April-February 2023-24.
Region-wise, positive year-on-year growth in February 2024 was observed in almost all the regions barring Association of SouthEast Asian Nations (ASEAN) countries and South Asia.