We are at the cusp of signing of one of the greatest trade deals for India, the trade agreement with European Union. Once signed, this deal is expected to open a market commanding almost 2 billion people and one-fourth of the global GDP – the deal has been hailed as the “Mother of all deals” by the European Commission President Ursula von der Leyen. For the engineering sector too, this is a very positive news. EU accounts for around 17 to 18 percent of India’s total engineering exports making it one of the largest export destinations. In April-November 2025, India’s engineering exports to the EU increased by more than 9 percent even at a time when rising protectionism and geopolitical conflicts continue to impact global trade. EU itself has adopted a number of protectionist measures. The first and foremost being the Carbon Border Adjustment Mechanism (CBAM) which is already effective on India since 1st January 2026. This is a carbon pricing mechanism applied to imports of carbon-intensive goods (steel, aluminium, cement, etc.) into the EU as it aims to prevent carbon leakage and promote cleaner production globally. This is expected to impose additional costs on carbon-intensive products like steel and aluminium, posing challenges for Indian exporters reliant on conventional energy, especially the MSMEs. Furthermore, EU has also implemented a number of safeguard measures which significantly impacts India’s steel exports. The exporting community sincerely hopes that the FTA will be able to offset these impacts and help increasing India’s exports to the region.

India’s engineering exports increased by more than 4 percent on a year-on-year basis as it reached USD 79.74 billion from USD 76.49 billion in April-November 2025. The growth rate surpassed that of the total merchandise exports which grew by only 2.62 percent. Another remarkable feat achieved by engineering exports in November 2025 was crossing the USD 11 billion mark first time in the current fiscal– engineering exports in November 2025 recorded a significant growth of more than 23 percent as it reached USD 11.01 billion. This result is possible due to the efforts of the exporting community which managed to quickly recover from the decline experienced in October 2025. As per the recent quick estimate results, engineering exports continues this growth streak in December 2025 and records a growth of around 4 percent in April-December 2025, still greater than that of the merchandise exports. This is a stellar performance given the current global trade situation. As per the recent update by the UNCTAD, as we enter 2026, global trade is subjected to increasing pressure from several factors including slower growth, geopolitical fragmentation, accelerating digital and green transitions and tighter national regulations - UNCTAD estimates global growth will remain subdued at 2.6 per cent in 2025 and 2026, despite potential gains from technologies such as artificial intelligence.

In these difficult times, government support is essential for the growth of the industry. In this context, EEPC India expresses its gratitude to the Ministry of Commerce for its continued commitment to export diversification and global market access. The Market Access Support (MAS) scheme under the Export Promotion Mission - NiryatDisha notified on 31 December 2025 is testament to this commitment as it accords priority consideration to several product and services sectors of national importance including agriculture, food processing, construction, etc. Engineering goods especially machineries and parts have significant contribution in these sectors. Hence it is expected that the MAS scheme would also help uplift engineering exports.

I am also delighted to mention that EEPC is the chief coordinating agency for the upcoming Bharat Electricity Summit to be held in March 2026 in collaboration with India’s strategic power companies including Power Grid, NTPC, etc. Held under the patronage of the Ministry of Power, Government of India, the event is expected to showcase India’s leadership, scale and innovation in renewables, storage and power infrastructure and the nation’s growing role in delivering solutions with global impact. The Curtain Raiser for the event was already held in Delhi. Since then EEPC has been conducting a number of roadshows across the states to promote the event. Apart from this, EEPC members are also expected to receive benefits in terms of participation cost. EEPC is also in charge of knowledge dissemination and coordination with key stakeholders. I am very hopeful that this event will be a huge success and will be able to fulfil its objective.