Engineering, aerospace exports get an upgrade

THE NEW TRADE framework between India and the US is expected to ease market access for Indian engineering goods and aerospace manufacturers by rolling back a layer of tariffs imposed over the past few years and restoring greater predictability to cross-border industrial supply chains.

- AKBAR MERCHANT & YARUQHULLAH KHAN

The interim agreement framework focuses on integrating manufacturing value chains by recalibrating tariffs on machinery, engineering products and aircraft components, sectors where Indian exporters have built scale but have faced margin pressure due to trade measures introduced since 2018-19.US duties on a range of industrial and aerospace products had risen following Washington’s steel and aluminium safeguards and subsequent overlays.

In aerospace, the US has indicated it will lift tariffs on specific aircraft and aircraft parts imported from India. Industry participants say the removal of these recent overlays is seen as an important step in restoring certainty.