India’s machinery exports to Russia increase threefold
Even as Indian exports to the rest of the world are slowing, engineering exports to Russia and other Commonwealth of Independent States (CIS) countries have registered a sharp uptick, jumping nearly three times from June last year, PTI news agency reported, citing data from the Engineering Exports Promotion Council (EEPC).
Engineering exports to Russia almost tripled in June 2023 and stood at $116.9 million. In cumulative terms, exports jumped four-fold during the April-June period of the current financial year to $337.4 million, from $89.7 million in the same period of the last fiscal year, the report noted.
Engineering shipments to CIS countries, which, apart from Russia, include Armenia, Azerbaijan, Belarus, Kazakhstan, Kyrgyzstan, Moldova, Tajikistan, and Uzbekistan, jumped by 161.2%. In comparison, there was just a marginal increase of 0.9% and 0.5% in exports to North Africa and the Northeast Asian region respectively in the same period. Major engineering products include iron and steel, zinc, tin products barring copper, nickel and lead products, industrial machinery, and parts, two and three wheelers and auto components, and tires.
Overall, India’s engineering exports continued to fall for the third straight month in June; they came in at $8.53 billion, about 11% less than the same month last fiscal year, the industry body said. Exports to key markets declined over the year – by 12.5% to the US, to $1.45 billion in June 2023, by 16.2% to the EU – to $1.51 billion in June 2023, and by 20% to China, to $184 million in June 2023.
“It is the metal sector that has been the most significant contributor to the decline. This has been a result of weakening global demand. The latest news has indicated that global demand for steel weakened further with slower offtake from China’s construction sector,” EEPC India Chairman Arun Kumar Garodia said.
He added that similar concerns, including the banking crisis in the US, have also affected the demand and price of copper, aluminum, lead, and zinc, which has affected India’s exports to its major partners, including the US, EU countries, and China. The situation is expected to further worsen with the implementation of the EU’s Carbon Border Adjustment Mechanism, he noted.
At the same time, Garodia said, India’s exports to countries with which it has signed free trade agreements, particularly the UAE and Australia, have increased since the signing of the deals. He suggested that having more comprehensive free trade agreements with potential partners will be the right step for India to achieve its goal of $2 trillion in exports by 2030. India has signed 13 regional trade agreements and free trade agreements with Japan, South Korea, countries of the ASEAN region, and countries of the South Asian Association for Regional Cooperation, Mauritius, United Arab Emirates, and Australia, the government announced last year.
