Global demand slowdown weighing on India’s engineering exports: EEPC
1 min read 22 Mar 2023, 05:44 PM ISTIndian engineering exports have been on a decline for seventh straight months in fiscal 2022-23 so far. Last month, engineering exports declined 9.68% to $8.58 billion from $9.50 billion in February 2022.
PremiumNew Delhi: Engineering Export Promotion Council of India on Wednesday said that India’s engineering exports to 17 of 25 key markets such as the US and China fell in February, driven by a global economic slowdown and low demand for metals and products.
India’s engineering shipments to the US dipped 9.1% year-on-year in February to $1.35 billion from $1.49 billion in the corresponding period last year. Exports to the US had risen 10.8%year-on-year in the first 11 months of the current fiscal.
Exports to China, another key market, slumped 33.3% year-on-year to $205.8 million in February. India’s engineering exports to China sank 54% year-on-year to $2.4 billion in the April-February period.
EEPC India chairman Arun Kumar Garodia said, “Our analysis indicates that global decline in demand for metals and metals products is mostly responsible for the negative growth in India’s exports. However, rising raw material prices, especially iron and steel have also made our metal exporters less competitive in the global market."
“There is a forecast of slow but gradual recovery. China, the largest global consumer, is also expected to recover from its real estate and financial crisis albeit at a slow pace. In this background, India may also look towards a slow recovery," he said.
Top exporting countries recorded positive growth in February were Singapore, UAE, Saudi Arabia, Mexico, and Indonesia. Major decline observed among the top destinations includes the US, Germany, and Italy.
Region-wise, positive year-on-year growth was noted only in ASEAN and WANA (West Asia and North Africa) during February. On a cumulative basis, year-on-year growth in exports was witnessed in North America followed by Latin America and Oceania while the highest decline was observed in North-East Asia.
Indian engineering exports have been on a decline for seventh straight months now in fiscal 2022-23. Last month, engineering exports declined 9.68% to $8.58 billion from $9.50 billion in February 2022.
Cumulative engineering exports for April-February 2022-23 also fell 4.24% on year $96.85 billion.
As per quick estimates of the Department of Commerce, the share of engineering exports to total merchandise exports from India was 25.57% in February, while for cumulative engineering exports from April-February 2022-23, the share was 23.86%.
Out of 34 engineering panels, 10 product panels witnessed positive growth in exports during February vis-a-vis the same month last fiscal.
Major engineering products like iron and steel, products of iron and steel, non-ferrous metals like aluminum, nickel, lead, tin, and other products, industrial boilers, IC engines and parts, air-conditioning and refrigeration machinery, machinery for dairy, electrical machinery, and equipment, motor vehicles/cars, two & three wheelers, bicycle parts, auto tyres, and hand tools witnessed a decline in exports during February 2023 vis-à-vis February 2022.
On a cumulative basis, 22 out of 34 engineering panels recorded positive growth during Apr-Feb 2022-23 over the same period last fiscal. The major decline was witnessed in the iron & steel segment, non-ferrous segment, two-three wheelers, railway transport, bicycle parts, and project goods.
