Home / Industry / Infrastructure /  India’s engineering exports to China decline 64% in September

NEW DELHI : India’s engineering exports declined in September from a year earlier with shipments to China and Europe recording a steep drop amid a slowdown in major economies.

Engineering exports, which comprise about a quarter of total outbound shipments, fell by 11% last month, dragged down primarily by lower iron and steel exports.

The share of engineering good exports in total merchandise exports fell to 23.69% in September from 27.85% in the same month last year, according to the Engineering Export Promotion Council (EEPC).

“This decline can be explained by falling steel exports. In September alone, exports of iron and steel came down by more than 60% and in cumulative terms the drop was more than 30%," said EEPC chairman Arun Kumar G. Garodia.

The decline in steel exports was mainly because of the imposition of a 15% export duty on iron and steel products from 21 May, he said.

While engineering exports to the European Union (EU) dropped 6.3 % from a year earlier in September, shipments to China fell 64% during the period to $203.61 million from $572.96 million a year earlier.

The decline in engineering goods exports poses a challenge in achieving the $127 billion sectoral export target set by the Union government for this fiscal, said Garodia.

Among the 25 key markets for engineering goods, exports to 15 countries recorded a decline in September. The US remained the top market for Indian engineering goods during the month, posting a 9% increase to $1.51 billion.

Engineering goods exports to the EU fell 6.3% from a year earlier to $1.61 billion in September. Among the countries, exports to Germany, Italy, Belgium, and Spain declined during the month, EEPC said in a release on Friday. At $217.89 million, engineering exports to the UK fell 38%.

Excluding the export of iron and steel, engineering exports recorded a 4.9% rise in September and 12.4% growth in the first half of this fiscal.

Iron and steel exports fell nearly 37% during the April to September period.

In terms of region, North America recorded the maximum growth in exports, followed by Latin America and Oceania in cumulative terms.

In the first half of this fiscal, engineering exports achieved 43.42% of the $127 billion target set by the Centre for the entire fiscal through March.

ABOUT THE AUTHOR

Dilasha Seth

" Dilasha Seth is a journalist reporting on macroeconomic policy for the last 11 years. She writes extensively on issues including international trade, macroeconomic data, fiscal policy, and taxation. At Mint, she reports on trade deals that India is signing besides key policy decisions of the Ministry of Finance. She closely tracked and covered the transition to the goods and services tax (GST) regime in 2017 and also writes on direct tax-related issues. In the past, she has worked with Business Standard and The Economic Times. She is based in Bangalore."
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