Engineering Exports To US May Take Tariff Hit Of USD 8 Bn

2025-09-06 02:05:46

(MENAFN- KNN India) New Delhi, Sep 6 (KNN) India's engineering exports to the United States are expected to decline by USD 7.5–8 billion following the imposition of 50 percent tariffs, underscoring the urgent need for government intervention and support.

“The business is down 50 percent. After frontloading of exports before the full tariff impact took effect, new orders are not coming,” said Pankaj Chadha, Chairman, Engineering Export Promotion Council (EEPC), as quoted by the Financial Express.

In 2024–25, India's engineering exports to the US stood at USD 20 billion, comprising USD 5 billion of steel and aluminium products, USD 2.6 billion of auto exports, and USD 12.5 billion of other engineering goods.

Exports of steel and aluminium are projected to fall by about 20 percent, while auto shipments may contract by USD 0.5 billion.

The steepest decline is expected in the USD 12.5 billion category of other engineering goods, which could lose half its sales as buyers shift to Vietnam, Indonesia and the European Union, where tariffs are significantly lower.

India's engineering sector, which contributes over a quarter of the country's total merchandise exports, is pressing for government intervention to offset losses.

Ahead of the July deadline, exporters accelerated shipments, pushing engineering exports up 6.08 percent year-on-year to USD 39.34 billion in April–July, with exports to the US rising 12.6 percent to USD 6.95 billion during the same period.

Industrial machinery, iron and steel, electrical machinery, and non-ferrous metals posted double-digit growth during April–July, while auto component exports dipped slightly. However, industry leaders warn the tariff shock will reverse these gains in the months ahead.

Commerce and Industry Minister Piyush Goyal said the government is preparing a comprehensive package under the Export Promotion Mission (EPM), which will soon be placed before the cabinet.

“The mission, which was announced much before the tariff action by US President Donald Trump, will be presented for approval shortly,” he said.

(KNN Bureau)

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