India's engineering exports edge up to USD 109 billion in FY24 despite geo-political tensions

India's engineering exports edged up to USD 109 billion in 2023-24 despite a slowdown in some of the major global markets amid geo-political tensions, EEPC said on Monday. India's engineering exports are competitive globally and expected to gain further market share in the coming years, with the country entering into more FTAs, it added.

The apex body of engineering goods exporters expects the value of shipments from the sector to rise to USD 300 billion by 2030 and generate a significant number of jobs and foreign exchange earnings in the process.

Notably, the engineering sector is the largest contributor to India's overall exports, with a share of 24 per cent, and also contributes approximately 40 per cent of the country's total manufacturing exports.

"The engineering goods exports in FY24 surpassed the previous year's numbers despite a slowdown in some of the key global markets, geo-political tensions, Red Sea crisis and high freight rates," said EEPC India Chairman Arun Kumar Garodia.

Engineering exports in FY24 rose to USD 109.31 billion from USD 107.04 billion in the previous financial year, thus registering a growth of 2.13 per cent, the Commerce Ministry data released on Monday showed.

According to EEPC, FY24 closed on a strong note, with engineering exports rising 10.66 per cent year-on-year to USD 11.28 billion in March against USD 10.19 billion in the same month last year.

"The monthly, as well as cumulative numbers, clearly show that the Indian engineering sector is quite competitive globally and consistently achieving success in penetrating new markets. The quick response from the government to counter various external challenges," Garodia said.

He further said that free trade agreements (FTAs) with the UAE and Australia have allowed the exporting community to deepen their foothold in key markets. "With more FTAs in the pipeline, engineering exports would certainly increase its share in the global market in coming years," the EEPC India Chairman said.

India and the four-nation European bloc EFTA recently signed a free trade pact under which New Delhi has received an investment commitment of USD 100 billion over the next 15 years to facilitate the creation of one million jobs. The European Free Trade Association (EFTA) members are Iceland, Liechtenstein, Norway, and Switzerland.

The agreement was signed after a gap of almost 16 years as negotiations started in 2008 but were put on hold in November 2013. Talks resumed in October 2016, and after 21 rounds of negotiations were held before its conclusion.

Australia is looking at achieving a "high-quality" Comprehensive Economic Cooperation Agreement (CECA) with India to ensure that it genuinely works towards broadening economic partnership, Australian High Commissioner Philip Green said in December.

Both sides are holding negotiations for an ambitious CECA that would build upon the existing Economic Cooperation and Trade Agreement (ECTA). The ECTA was signed in April last year, and it came into force in December 2022.