Engineering exports likely to fall this fiscal

New Delhi : India's engineering exports this fiscal are unlikely to reach last year's $70 billion due to global demand slowdown, Engineering Exports Promotion Council (EEPC) said on Tuesday. The EEPC said that during April-November this fiscal, the exports declined by 14.4 per cent to $39.85 billion.

"There is no question of engineering sector reaching the last year's level of $70 billion in 2015-16. We may end up the year with shipments of around $60-62 billion with hopes that things start changing for the better in the next financial year," EEPC said in a statement.

This is despite a 7-8 per cent depreciation in the rupee against the dollar as the sector battles a global slowdown. "The level of crisis in engineering exports, which account for about 23 per cent of India's total merchandise exports, can be gauged from the fact that for the latest data of November, as many as 26 out of 33 engineering segments showed a negative trend," it said.

The situation has worsened because of "excessive protection given by the government to domestic large-scale steel firms by way of safeguard and anti-dumping duties".

The council saw the proposal to fix a minimum import price for certain steel products further impacting the sector."All these measures are lopsided and overlook interest of the small and medium enterprises, which are then made to buy their raw material at higher costs, losing competitive edge in the tough international market," EEPC India explained.

Exports to all the top destinations, including the US, the UAE, the UK, China, Germany, South Africa and Singapore are in decline. Out of the 221 destinations for export of Indian engineering goods, the top 25 countries account for 72.9 per cent in April-November of 2015-16.