As we approach the middle of 2025, the global trade scenario exhibits significant dynamism in the response to continuous shifts in the global power alignments and persistent geopolitical tensions. The landscape of international trade in July 2025 is a mix of policy shocks, regional realignments and modest recovery. As per the recent Global Trade Update by the UNCTAD, overall global trade growth was positive in the first half of 2025 with trade in goods registering a 1.5 percent growth. This gradual growth was despite the increasing trade policy uncertainty, ongoing geopolitical conflicts and a challenging global economic environment. This only indicates towards the dynamism in global trade in response to the changing scenario.

The frequently shifting trade policies in the USA has been one of the most critical determining factor for the global trade. As per UNCTAD, that sudden import increase in the US fuelled by the threat of reciprocal tariffs looming over the US buyers have definitely contributed towards the growth of trade in goods. This is also reflected in India’s trade data for the current fiscal – In the first two months that is April-May 2025, India’s engineering exports to the US increased by more than 110 percent. Overall India’s engineering exports growth remained positive in the first two months of FY 2025-26. While our exports to North America and EU registered growth, it was impacted in some countries in Middle East and West Asia including Saudi Arabia and Turkey due to geopolitical tensions and logistical challenges in the region. Exports of aluminium and its products was also hit due to increased competition in the ASEAN region and even Middle-East especially Saudi Arabia.

The UNCTAD Global Trade Update predicts a resilient second half for 2025 however it also cautions regarding the growing uncertainty in global trade practices. The World Bank has recently cut the growth forecast for almost 70 percent of the economies in response to the heightened trade tensions and policy uncertainty – they have clearly mentioned that the growth in 2025 is expected to be slowest since 2008. The World Bank has projected the Global economic growth at 2.3 percent, nearly half a percentage point lower than the prediction at the beginning of the year. While they do not anticipate a recession, such decline in global growth is also expected to impact international trade. The World Bank further cautions that advanced economies have accounted for nearly 70 percent of the new trade restrictions since 2022 and these rising restrictions have disproportionately impacted the countries which depend on these markets. In this scenario, many countries are going for regional integration or regional trade agreements as a buffer against the global fragmentation. India should also look into strengthening its relations with regional groups within Middle East and West Asia, Africa and Latin America and even East Asia to protect our exports in this challenging scenario. The support of the Government of India has also become critical in this context, especially for the MSMEs to access cheaper and good quality raw materials at affordable price and cheap export credit. We at EEPC India are in constant touch with the Ministry of Commerce to expedite these support for our fellow engineering exporters.

Finally, showcasing India’s engineering prowess has also become critical in the current context. As the leading export promotion council the role of EEPC India is also assuming greater importance in this context. We are currently participating in a number of domestic and international exhibitions with the aim to reach as many markets as possible. EEPC India is a part of the Bharat Health Global Expo which is happening in September 2025. India is also part of the India MSME Defence Week 2025 which is also taking place in September. Other than that, EEPC India is also organising the India Pavilion in International fastener Expo in Las Vegas, USA. We urge our exporters to visit the EEPC website to gather more information on these events and participate accordingly to expand their reach.

In conclusion, as the global trade scenario becomes more volatile, the Government and the industry must find ways by forging new alliances and creating more innovative and value added products which would help India in increasing its share in the global market.