Resilience is one of the prime words describing India’s engineering exports sector when the global trade map is changing. The exporters are now grappling with complex tariff systems and even stricter trade norms due to the return of protectionist policies and increased geopolitical tensions, specifically in the United States under the reinstated Trump administration.
Despite all this uncertainty, engineering exports from India are showing far greater strength than general merchandise exports, which reflects the sector’s real strength and adaptability.
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Global Trade Shifts: Tariff Walls Return
February and March 2025 went through turbulent times as the United States reimposed Section 232 tariffs – 25% on steel and now 25% on aluminium, up from 10%. These proclamations came with the immediate revocation of all prior product- and country-specific exemptions.
India, labeled a “High Tariff Nation” by the U.S., faces considerable headwinds. Some of these include:
- Increased export costs
- Loss of price competitiveness
- Reduction in market access in the U.S.
Performance of India’s Engineering Exports (April–Jan 2025)
Engineering exports from India stood its ground and grew by approximately 10% during the period April 2024 to January 2025, overcoming the global pressure, while total merchandise exports had only a 1.39% growth.
Comparative Export Growth (April–January 2025)
| Category | Growth Rate (%) |
| Engineering Exports | +10% |
| Merchandise Exports | +1.39% |
Anything above 7% growth was achieved in engineering exports in January 2025 alone during the cooling-off between U.S. exports and the general export contraction.
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Top Performing Export Categories
As per EEPC India, India’s engineering exports strength comes from multiple categories:
| Category | Contribution |
| Aircraft and Spacecraft Parts | High |
| Electric Machinery & Equipment | High |
| Automobile Components | Significant |
| Industrial Machinery | Significant |
| Products of Iron and Steel | Consistent |
| Medical & Scientific Instruments | Growing |
The WANA, Sub-Saharan Africa (SSA), and Latin America (LAC) regions supported these segments besides performing well in traditional markets like North America and the EU.
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India’s Dependence on the U.S. Market
The U.S. is by far the largest export destination for Indian engineering goods, with more than 20% of total sectoral exports going there.
Challenges posed by the US tariff regime:
- All Section 232 exclusions removed
- Coverage widened to include derivative and finished goods
- No waivers under the new proclamations in 2025
Exports are now fully taxed at 25% for fabricated steel, auto components, fasteners, and pipes. Quite a challenge now.
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How India Is Adapting to Global Tariff Challenges
1. Trade Diversification
India actively pursues FTAs Bi-Multilaterally with collaboration beyond the West:
| Ongoing FTAs | Status |
| UAE & Australia | Signed |
| UK, EU, GCC | Negotiating |
| LAC & Africa | Future Target |
2. Promoting Brand India
EEPC India participates in key international trade fairs:
- Hannover Messe (Germany)
- BAUMA (Germany)
- Middle East Energy (Dubai)
- Turkey Multi-Product Delegation
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Role of Niir Project Consultancy Services (NPCS)
At Niir Project Consultancy Services (NPCS), we assist startups and entrepreneurs in navigating the complexities of industrial setup and exports.
Our Market Survey cum Techno-Economic Feasibility Reports comprise:
- Manufacturing Process
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Recommended Blogs on Engineering & Export Business
- Top 50 Manufacturing Business Ideas for 2025
- Export Business Ideas for Small Entrepreneurs
- How to Start Aluminium Recycling Business
- Carbon Credit Opportunities for Industrial Units
- Starting an Automobile Components Manufacturing Business
For more updates, follow our blog: https://www.niir.org/blog/
Final Thoughts
Having faced major global tariff headwinds, Indian engineering exporters have adapted themselves very well and have been strategic in expanding into fresh markets. Their hands are full with the pressures of U.S. trade policy while the policies in their company, combined largely with industry adaptability, sustain growth.
Challenges can be great long-term world opportunities with the right planning, market research, and technical aid available to Indian entrepreneurs.
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