Global rollout of Covid-19 vaccines along with the Centre’s initiatives is expected to boost exports in the coming months, EEPC India said.
“Given the initiatives announced by the government and the speedy rollout of vaccination, we expect the growth to return in the coming months. There is also a gradual recovery in global trade which will have a positive impact on the export sector in India,” said the Chairman of Engineering Export Promotion Council of India (EEPC), Mahesh Desai.
Last month, India’s merchandise exports rose marginally to $27.93 billion from $27.74 billion recorded in February 2020. Accordingly, the share of engineering items in total merchandise exports was 23.49 per cent during this period.
“Lower exports during February 2021 could be partly attributed to the base effect as shipments had seen a sudden surge in the corresponding period last financial year. However, drop in shipments is certainly a cause of concern for exporters,” Desai said.
Besides, the EEPC India cited that China, Singapore, Germany, Thailand and Italy were among the nine countries that saw high double-digit growth in demand for Indian engineering goods in February 2021.
Exports to China, India’s second largest export destination, recorded a positive growth in both monthly as well as cumulative terms.
“While shipments to China jumped 68 per cent to $235.58 million in February, exports during April-February of FY21 saw a stellar year-on-year growth of 114 per cent to $4276.49 million,” the EEPC analysis report said.
As per EEPC data, North America continued to be the biggest market for Indian engineering goods with 18.3 per cent share while the European Union (EU) and ASEAN ranked second and third in the pecking order, respectively.
“The EEPC analysis showed engineering exports to the EU recording positive monthly growth in February 2021 compared to February 2020 after a long hiatus,” it said.
Among 33 product segments, 12 categories recorded negative growth in February, while the remaining 21 posted positive growth.
“China, Vietnam and Nepal were the three top importers of Indian iron and steel during April 2020-February 2021 with market shares of 23.19 per cent, 8.80 per cent and 7.91 per cent, respectively. The US, the UAE and Germany were the top three importers of products made of iron and steel during April-February 2021,” it said.
At present, the engineering goods sector is a key component of the broader manufacturing industry. It accounts for about 25 per cent of India’s total global exports in the goods sector and is one of the largest foreign exchange earners. The sector employs nearly 4 million skilled and semi-skilled workers.