Trade Analytics

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March, 2012

Brief Introduction

The Indian engineering sector is the largest segment of the Indian industry and is highly driven by robust economic growth. The performance of engineering sector gets reflected in the performance of end-user industries like automobiles, chemicals, information technology (IT), aerospace etc. Indian service providers and captives employ around 200,000 engineers.

There are various international organisations that make very positive comments about various segments of the engineering industry. For instance- The IEEE Standards Association (IEEE-SA), the standards development body of the Institute of Electrical and Electronics Engineers, is keen on strategic collaborations with industry leaders, academia and other standards bodies to generate awareness about smart grid and the importance of standards through events and workshops. The IEEE-SA has also set up a Standards Interest Group (SIG) recently to increase India's participation in the IEEE standards process in key areas such as smart grid.

Similarly, National Association of Software and Services Companies (NASSCOM) has stated that India is ranked first in the field of Engineering Research and Development and Design (ER&D) outsourcing industry with a 22 per cent share in the revenue globally. The segment contributes 15 per cent of total US$ 60 billion Indian IT & business process outsourcing (IT-BPO) industry. Moreover, cost savings by Indian ER&D centres in FY2011 was over US$ 20 billion.


Engineering exports include transport equipment, capital goods, other machinery/equipment and light engineering products like castings, forgings and fasteners.

Going by the data compiled by the Engineering Export Promotion Council (EEPC), the apex body of engineering exporters, engineering exports grew by 20.9 per cent to US$ 54.5 billion over April 2011-February 2012 as against the same period in 2010-11. For January and February 2012, export consignments amounted to US$ 4.73 billion and US$ 4.79 billion, respectively.

EEPC anticipates engineering exports to be around US$ 62 billion for the fiscal 2011-12.

Key Developments and Investments

The miscellaneous mechanical and engineering industries’ sector-wise foreign direct investments (FDI) inflows from April 2000 to January 2012 was calculated at US$ 2, 180.26 million, as per the Department of Industrial Policy and Promotion (DIPP)