EEPC proposes methods to boost India’s engineering exports

Seeking new free trade agreements (FTAs) with emerging economies in Latin America and Africa, a program to support MSMEs in research and innovation, the establishment of a domestic shipping line and global branding of Indian products are among the key proposals in a strategy paper prepared by EEPC India to Boost engineering exports and reach the target of $300 billion by 2030.

At a meeting convened by the Ministry of Trade and Industry this week, EEPC India Chairman Arun Kumar Garodia discussed various recommendations in the strategy paper to boost Indian engineering exports.

Union Minister of Trade and Industry Piyush Goyal chaired the meeting.

The strategy paper calls for better market access, especially in Africa and Latin America, as these have the potential to become important export markets for India. It has been found that by expanding into non-traditional markets, the risk associated with economic uncertainties can be spread, reducing dependence on a few markets.

Referring to the strategy paper, Garodia said that currently around 40 countries account for over 87% of India’s engineering exports. Therefore, there is a great opportunity to explore new markets while expanding the existing base.

“It is crucial for India to develop new markets, especially in Latin American and African countries. Many of our competitors have already concluded free trade agreements with these countries and therefore have a competitive advantage over us. Free trade agreements with these countries can create a level playing field, ensure fair market access and expand our exports,” said Garodia.

Garodia said that given the current global economic trends, the global economy is expected to slow down this fiscal year, impacting Indian machinery exports as seen in recent months.

Among the measures to expand the current market base, he suggested strengthening its presence in Europe through the implementation of a free trade agreement with the EU as a priority.

Garodia stressed the importance of the engineering sector, saying that the industry accounts for 25% of the country’s total exports and is the biggest foreign exchange earner. Notably, MSMEs account for 35-40% of total engineering exports and are therefore important employers.

The strategy paper highlighted that most MSMEs face financial constraints and struggle to secure investments. She has recommended the introduction of an aggressive “SME support scheme” to support research and innovation in the MSME sector.

On the need to set up a domestic shipping company, Garodia said it would lower trading costs, reduce dependence on foreign shipping companies and save huge amounts of valuable foreign exchange.

He added that dedicated branding and marketing efforts are essential to success in specific product categories and markets.

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