US tariffs bite: India’s engineering exports slump 16.7% in October; Asean, EU and UAE shipments weaken

India’s engineering goods exports fell a steep 16.71 per cent year-on-year in October 2025 to $9.37 billion, primarily due to a sharp drop in shipments to the US and a high base effect, the Engineering Export Promotion Council of India (EEPC) said on Saturday.Exports to key markets recorded widespread declines, with the Asean region seeing an almost 50 per cent fall to $1.02 billion.The US remained India’s top destination for engineering goods, but shipments dropped 14.5 per cent to $1.39 billion in October 2025, compared with $1.63 billion a year earlier. The decline was driven by the combined impact of Section 232 tariffs and reciprocal tariffs, EEPC said. Exports to the UAE fell 19.3 per cent to $667 million, while North America and the EU — the top two regions — also witnessed year-on-year declines for the second consecutive month. Significant drops were noted across WANA, South Asia, Latin America and the CIS region.“While a high base effect was one of the reasons for the drop in exports during October this year, it was also a result of the US-administered reciprocal tariffs… The industry believes that trade diversion due to US tariffs is one of the reasons behind the declining exports,” EEPC Chairman Pankaj Chadha said. He added that the industry welcomed the government approving over Rs 25,000 crore for the Export Promotion Mission and Rs 20,000 crore for credit guarantee support.The fall in October marked the second monthly decline of FY26 after May, ending a four-month streak of growth. Panel-wise data showed major contractions in ‘Aircrafts and Spacecraft’ and ‘Ships, Boats and Floating structures’, both falling over 80 per cent.Key categories including ‘Electrical machinery’, ‘Products of iron and steel’, ‘Industrial machinery’ and ‘Aluminium products’ also registered year-on-year declines. Overall, 23 of 34 engineering panels recorded negative growth in October.India’s exports to the US have been under pressure for months due to steep tariff hikes. Between May and October 2025, US-bound shipments fell 28.5 per cent as American duties climbed from 10 per cent in April to 50 per cent by late August, as per a GTRI report. Labour-intensive goods, which faced 50 per cent tariffs, saw a 31.2 per cent drop in the same period.Despite the October setback, engineering exports grew 1.68 per cent on a cumulative basis during April-October 2025, rising to $68.73 billion from $67.60 billion a year earlier, ANI reported.