Sharp decline in shipments to US, ASEAN drag down engineering exports in October: EEPC India

Engineering goods exports to many key markets recorded negative growth in October this year, with the ASEAN region recording a nearly 50 per cent decline to USD 1.02 billion, EEPC noted in a statement.

Engineering goods exports to as many as 15 of the 25 key destinations registered negative growth during October 2025.

The US remained the top destination, followed by the UAE and Germany, but exports to these countries declined year-on-year in October 2025.

For the other top destinations, in Saudi Arabia and the UK, exports recorded decent growth in October 2025 over the same month last fiscal, EEPC noted.

Region-wise, North America and the EU remained the top two export destinations for Indian engineering, but exports to both areas declined for the second time in October 2025 year-on-year.

Significant decline was also noted in WANA, South Asia, Latin America, and CIS during the period under review, the Export Promotion Council noted in the statement.

The decline in exports to the US was fuelled by the combined impact of Section 232 tariffs and the reciprocal tariff. The total value of engineering exports to the US stood at USD 1.39 billion in October 2025, down from USD 1.63 billion in October 2024, a 14.5 per cent year-on-year decline.

In the case of the UAE, India's second biggest market for engineering goods, exports fell 19.3 per cent year-on-year to USD 667 million in October 2025.

"While a high base effect was one of the reasons for the drop in exports during October this year, it was also a result of the US-administered reciprocal tariffs. Decline was also noted in other prominent export destinations, including the UAE, EU countries, and ASEAN countries. The industry believes that trade diversion due to US tariffs is one of the reasons behind the declining exports," said Pankaj Chadha, Chairman, EEPC India.

He further said, "In this difficult time, we are thankful to the government for approving more than Rs 25,000 crores for the Export Promotion Mission (EPM). Exporters are eagerly anticipating its implementation. Additionally, the allocation of Rs 20,000 for credit guarantee is also expected to boost the morale of the engineering industry."

Indian engineering exports conceded a year-on-year decline in October 2025 after four consecutive months of growth.

This was the second monthly decline in fiscal 2025-26 after May 2025.

Panel-wise analysis revealed that the decline in overall engineering exports was led by more than 80 per cent decline in exports of 'Aircrafts and Spacecraft' and 'Ships, Boats and Floating structures' in October.

The other key segments, such as 'Electrical Machinery and equipment', 'Products of Iron and Steel', 'Industrial machinery', and 'Aluminium and products', also conceded a year-on-year drop in exports.

As many as 23 out of 34 engineering panels witnessed negative year-on-year growth in October 2025, EEPC noted.

According to the government's quick estimates, EEPC reported that the share of engineering in total merchandise exports was 27.27 per cent in October 2025, slightly lower than the previous month's 27.80 per cent.

Engineering exports, however, still recorded year-on-year growth on a cumulative basis. During April-October 2025, engineering exports stood at USD 68.73 billion, as against USD 67.60 billion during the same period last fiscal, registering a 1.68 per cent year-on-year growth.

On a cumulative basis, 27 out of 34 engineering panels recorded positive growth, and the remaining 7 engineering panels, including aluminium and nickel products, recorded negative growth during the April-October period of 2025-26, the EEPC statement concluded. (ANI)