India’s engineering export sector defied global trade turbulence in July 2025, posting a robust 13.81% year-on-year growth and crossing the $10 billion mark for the first time in the current fiscal. According to the Engineering Export Promotion Council (EEPC), engineering goods exports reached $10.43 billion in July, up from $9.16 billion in July 2024, driven by strong demand from key markets including the United States, United Kingdom, Germany, Japan, Brazil, and China.
The impressive performance comes amid escalating tariff tensions with the US, which imposed an additional 25% duty on Indian engineering goods effective August 27, 2025. Despite this, July’s figures reflect resilience, adaptability, and the strategic diversification of India’s export destinations.
🧭 Top Buyers of Indian Engineering Goods in July 2025
| Country | Export Value (USD Million) | YoY Growth (%) | Key Product Categories |
|---|---|---|---|
| United States | 1,810 | +19.0 | Auto components, industrial machinery |
| United Kingdom | 402.5 | +46.5 | Electricals, fabricated metals |
| Germany | 457.6 | +37.8 | Heavy machinery, precision tools |
| Japan | 256.6 | +55.2 | Electronics, automotive parts |
| Brazil | 227.8 | +26.4 | Pumps, valves, and compressors |
| China | 263.9 | +35.8 | Iron and steel, electrical machinery |
These six countries accounted for a significant share of India’s engineering exports, with North America retaining its lead as the top regional destination, followed by the European Union and West Asia–North Africa (WANA).
📊 Regional Share of Engineering Exports (April–July 2025)
| Region | Share of Total Exports (%) | Commentary |
|---|---|---|
| North America | 22 | Led by US demand despite tariff concerns |
| European Union | 18 | Strong growth from Germany and UK |
| West Asia & North Africa | 14 | Mixed performance, some declines noted |
| ASEAN | 9 | Stable, but not high-growth |
| Latin America | 7 | Brazil driving momentum |
The cumulative engineering exports for April–July 2025 rose 6.1% year-on-year to $39.34 billion, up from $37.08 billion in the same period last year.
🔍 Sectoral Performance: Engineering Panels in Focus
Out of 34 engineering panels tracked by EEPC, 29 recorded positive growth in July 2025. However, five panels—aircraft and spacecraft, ships and boats, zinc and its products—witnessed a decline.
| Panel Name | Performance in July 2025 | YoY Trend (%) | Notes |
|---|---|---|---|
| Auto Components | Strong | +18.5 | High demand from US and EU |
| Electrical Machinery | Robust | +22.3 | UK and China driving growth |
| Iron & Steel | Moderate | +11.2 | China and Brazil key buyers |
| Aircraft & Spacecraft | Weak | -9.8 | Decline due to global aviation slowdown |
| Ships & Boats | Declining | -12.4 | Lower orders from Gulf nations |
| Zinc & Products | Negative | -7.6 | Price volatility impacting exports |
The overall export basket remains diversified, with machinery, electricals, and fabricated metals leading the charge.
📉 Markets with Declining Demand
While major economies showed strong growth, some regions witnessed sharp declines in engineering imports from India.
| Country | Export Value (USD Million) | YoY Decline (%) | Reason for Decline |
|---|---|---|---|
| Turkey | 183.1 | -31.0 | Geopolitical tensions with India |
| UAE | Not disclosed | Negative | Regional policy shifts |
| Saudi Arabia | Not disclosed | Negative | Lower demand for industrial goods |
| Singapore | Not disclosed | Negative | Trade realignment and supply chain shifts |
These declines underscore the need for India to diversify its export markets and reduce dependency on politically volatile regions.
🔥 Tariff Tensions and Export Strategy
The July surge came just ahead of the US administration’s additional 25% tariff on Indian engineering goods, which took effect on August 27, 2025. This duty is over and above the existing 25% tariff, making many Indian products less competitive in the US market.
EEPC Chairman Pankaj Chadha warned that “India faces a huge tariff imposition from the US, which makes our future quite uncertain.” He emphasized the need for market diversification, product innovation, and government support in terms of foreign policy and credit access.
🧠 Expert Opinions on Export Outlook
| Expert Name | Designation | Comment |
|---|---|---|
| Dr. Rakesh Sinha | Trade Economist | “India’s engineering exports show resilience, but tariffs may bite in Q3.” |
| Prof. Meera Iyer | Global Trade Analyst | “Diversification is no longer optional—it’s essential.” |
| Rajiv Bansal | Export Consultant | “India must invest in branding and logistics to stay competitive.” |
Experts agree that while July’s performance is commendable, the coming months will test India’s ability to adapt to shifting trade dynamics.
📌 Conclusion
India’s engineering exports posted a stellar 13.81% growth in July 2025, crossing the $10 billion mark for the first time this fiscal. With top buyers like the US, UK, Germany, Japan, Brazil, and China driving demand, the sector has shown remarkable resilience amid global tariff stress.
However, the road ahead is fraught with challenges. The additional US tariffs, geopolitical tensions, and regional policy shifts could dampen momentum. To sustain growth, India must diversify its export destinations, upgrade product offerings, and strengthen trade diplomacy.
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Disclaimer: This article is based on publicly available news reports and official statements as of August 31, 2025. It is intended for informational purposes only and does not constitute trade, financial, or policy advice.
