Engineering goods exporters diversify markets during uncertain times

Indian engineering goods exporters look to diversify to Latin America, Africa, and Oceania amid trade uncertainties with the US;

Update: 2025-01-23 13:10 GMT
India's engineering goods exports recorded the eighth month of positive growth in December 2024 with total shipments value crossing $10 billion for the second time during the year. (Representative Image: DC)

Chennai: The engineering goods exporters are looking at diversifying their geographical presence to Latin America, Africa and Oceania as trade uncertainties loom large over their largest market, the US.

India's engineering goods exports recorded the eighth month of positive growth in December 2024 with total shipments value crossing $10 billion for the second time during the year.

While the US remained the top destination for engineering goods exports in December 2024, West Asia and North Africa (WANA) emerged as the top region for exports for the first time during this period.

Engineering goods exports to the US registered 5 per cent year-on-year growth to $1.64 billion in December 2024. On a cumulative basis, exports to the US during the April-December period of FY25 rose 7 per cent to $13.97 billion as compared to $13 billion in the corresponding period a year ago.

However, the uncertainty over the trade with the US is forcing exporters to look for other destinations.

"While the growth continues there is growing uncertainty and the same has been highlighted by UNCTAD in its recent report. Going forward, global trade trends are expected to be largely influenced by protective measures by the developed nations, especially the USA, and the threat of possible trade wars," Pankaj Chadha, Chairman, EEPC India said.

"In the wake of this challenging environment, we need to diversify our trade presence in new markets, especially those in Latin America, Africa, and even Oceania. The government's support will be crucial in this. Additionally, government support is needed in importing critical raw materials where domestic supply at affordable cost is not adequate," he added.

Furthermore, WANA region has displayed high growth potential. WANA region's share in India's total engineering exports was 20.8 per cent in December 2024 followed by North America 19.1 per cent and European Union 17.1 per cent. High growth was seen in France, Saudi Arabia, South Africa, and Sri Lanka on a year-on-year basis during December 2024.
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