Engineering exports emerge major contributor to external outward trade

KOLKATA: Buoyed by a huge rise in exports of iron and steel and several non-ferrous metals, India's engineering exports have emerged as a major contributor to the external outward trade, accounting for over one-fourth of the country's entire merchandise exports which were also helped by buoyancy in shipments to select destinations, including the US and China, an EEPC India analysis has shown.

According to the latest data, India's engineering exports continued to witness significant growth for the eighth consecutive month in May, 2017, though 7.5 per cent year on year expansion during the month was slower than that of April, 2017 when shipments had grown by a huge 25 per cent Y-on-Y.

"Still, buoyed by iron, steel and other metals, the engineering exports of $6 billion in May, 2017 accounted for 25.2 per cent of the country's entire export basket, against 23.8 in April, 2017 when the monthly shipments were $5.92 billion," the analysis noted. India's total merchandise exports aggregated to $24.01 billion in May, registering an annual growth of 8.32 per cent.

Commenting on the development, EEPC India chairman TS Bhasin said "There is a demand pick up for basic material in the US and China, besides some other key economies, reflecting a revival in the global economic activities, giving a push to the exports of mother industries."

Out of 33 engineering segments, 25 recorded growth in May, 2017 over the same month last year. Iron and steel exports jumped by more than 58 percent during May with overseas shipment of $ 797.5 million , against $504.5 million in the same month last year. Cumulative figure showed 99.5 percent growth of exports during April - May 2017 to $1.7 billion from $ 853.8 million during the same period last fiscal for this vital segment.

Products of iron and steel increased in export by 14.6 per cent during the month under review while its cumulative exports increased by 17 per cent to $1.03 billion during April - May 2017 against $ 885.3 million during the same period in 2016-17.

Significantly, the total engineering exports to the USA went up by a huge 82 per cent to $902 million during May, 2017 from $ 495 million in the same month last fiscal. Likewise, the engineering shipments, largely helped by the iron , steel and metal pack, to China too shot up by 96.6 per cent to $189 million from $96.2 million.

"While the basic raw materials have helped revival of our engineering exports, we need to work hard and get a foothold in the export of technology-driven value –added items. Some key initiatives have been taken in this regard with the help of the Commerce Ministry. These include setting up an EEPC Technology Centre in Bengaluru," Bhasin said.