Trade Analytics
Engineering and Capital Goods
Engineering exports from India increased 14.7 per cent to US$ 70.6 billion in FY15’.

Indian Engineering Industry Analysis

Latest update: February, 2018

  • Engineering exports from India stood at US$ 65.23 billion in FY17
  • During FY08–FY17, engineering exports from India registered growth at a CAGR of 7.61 per cent
  • Engineering exports include transport equipment, capital goods, other machinery/equipment and light engineering products such as castings, forgings and fasteners
  • In August 2016, engineering exports by India, to its top 25 destinations, registered a growth of 5.8 per cent over August 2015
  • With the revival of demand for iron and steel in China and the US, India’s engineering exports reached US$58.8 billion in FY16.
  • During the fiscal year 2016-17, the exports have touched US$65.23 billion, which exceeds the total shipments of US$58.8 billion in 2015-16.

Note: FY - Indian Financial Year (April to March)

  • Transport equipment (which includes Auto and auto component including Aircraft and ship boats) is the leading contributor to engineering exports. The segment accounted for 32.46 per cent of the total engineering exports from India in FY17.
  • Exports of iron and steel products accounted for a market share of around 22.44 per cent, in the overall exports, while industrial machinery including electrical machinery accounted for 23.85 per cent of the total engineering exports in FY17.
  • Other commodities includes medical and scientific instruments, hand tools and cutting tools, bicycle parts, office equipment, prime mica and mica products, etc. and accounted for a share of 10 per cent of the total engineering exports from India in FY17.
  • Attractive markets for Indian engineering products are USA, China, Germany, U.K., Canada, France, Russia, Japan, Australia, South Korea, Saudi Arabia and Southern Africa.

Note: FY - Indian Financial Year (April to March)
Source: Engineering Export Promotion Council, Department of Commerce


Last Updated: February, 2018

The Indian engineering sector is divided into two major segments - heavy engineering and light engineering. The capital goods and engineering turnover in India is expected to have reached US$ 125.4 billion by FY 2016-17. Likewise, Electrical equipment market size is expected to reach US$ 100 billion by FY 2021-22. Comparative advantage vis-à-vis peers in terms of manufacturing costs, market knowledge, technology and creativity has been a driving force for engineering exports from India.

Construction equipment industry recorded sales of 76,000 and 68,000 units of construction equipment in FY16 and FY17 respectively. This is further expected to grow to around 96,730 units by 2018. Construction equipment market is projected to reach US$ 7 billion by 2020 from US$ 4.2 billion in FY17. Production of machine tools totalled Rs 5,803 crore (US$ 896.35 million), while exports stood at Rs 360 crore (US$ 55.61 million) in FY17.

Companies engaged in the engineering sector are virtually on a roll. Capacity creation in sectors like infrastructure, power, mining, oil & gas, refinery, steel, automotive, and consumer durables has been driving demand in the engineering sector. Separately, the approval of significant number of special economic zones (SEZs) across the country and the development of the Delhi Mumbai Industrial Corridor (DMIC) across seven states is expected to further bolster the engineering sector.

With 100 per cent Foreign Direct Investment (FDI) allowed through the automatic route, and initiatives like ‘Make in India’, major international players have entered the Indian engineering sector due to significant growth opportunities available. The engineering sector has received cumulative FDI inflows worth US$ 3.39 billion during April 2000 to December 2017.

Sectoral Presentation (February, 2018)

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