India’s small and medium enterprises (SMEs) are no longer just supporting players in engineering exports. Over the last decade, they’ve rapidly emerged as major growth engines in industrial machinery manufacturing and related sectors. Between April 2024 and January 2025, engineering exports from India jumped 10%, far outpacing the overall merchandise growth of just 1.39%. MSMEs, which already account for more than 40% of the expansion of the sector, are driving this surge.
Current Contribution of SMEs In India Vs. Other Export Economies
Projections for FY2025 show MSMEs powering nearly 45% of India’s total exports, with engineering goods and machinery production leading the pack. While China continues to dominate in absolute numbers, India is catching up in terms of year-on-year growth, leaving peer economies like Germany behind in momentum. The biggest buyers? The US, the Middle East, and the EU, according to EEPC data.
| Sector | Growth |
| Automobile Components | +12.4% |
| Industrial Machinery | +10.8% |
| Electric Machinery | +9.6% |
| Iron & Steel Products | +11.7% |
From crossing the USD 112 billion mark in 2021-22 to hitting a record USD 116.67 billion in 2024-25, India’s engineering and machinery manufacturing exports have proven their resilience and steady upward climb, even against global headwinds.
Cost Competitiveness in Engineering & Industrial Machinery Manufacturing
Cost has always been India’s ace in the global export game. IBEF points out that both raw material and labor costs here are far below what manufacturers pay in the US or Europe. Payroll expenses alone tilt the balance, giving Indian SMEs a strong edge on pricing, particularly in industrial equipment manufacturing.
Local sourcing advantage
SMEs save even more by relying on India’s own supply of metals and components. With raw materials available close to home, import bills shrink and procurement cycles speed up.
Cluster power
Suppliers work in close clusters in many Indian states. This infrastructure adds to convenience and slashes transportation costs and production timelines for manufacturing of engineering machinery significantly.
Policy cushion
Many state governments chip in with rebates and subsidies, helping SMEs absorb costs and stay competitive abroad. Yet, drawbacks continue to slow down the pace. Delays at ports, unreliable power supply, and longer delivery times often chip away at these advantages. After all, cost advantage is only half the battle.
Smarter Industrial Machinery Manufacturing: CNC, Automation, Digital Platforms
Technology is no longer a luxury for SMEs, but a driver of competitiveness in industrial machinery manufacturing. Thanks to initiatives like ‘Make in India’, many small manufacturers now have access to CNC machines and automation tools that were once out of reach.
Precision that pays
CNC and IoT-driven systems bring accuracy that manual methods simply can’t match. For exporters, this means fewer reworks, consistent quality, and lower operational costs – exactly what global buyers look for.
Data as a growth driver
SMEs that plug into analytics and digital platforms are finding a new rhythm. From tracking production efficiency to predicting maintenance needs, data-backed decisions are helping them deliver faster and with more confidence.
The export edge
Manufacturers are incorporating advanced technologies to win repeat orders. Beyond keeping up in the competitive market, they are expanding their footprint faster than traditional competitors.
Partnerships That Actually Open Doors for SMEs
Breaking into global markets has never been easy for smaller Indian manufacturers. Many SMEs in machinery manufacturing already produce at global standards, yet they struggle to get a seat at the table with international buyers. The missing link isn’t capability, it’s access. This is where platforms like rivexa step in, creating a bridge between Indian suppliers and overseas demand.
Trust matters more than price
Overseas OEMs are wary of cold calls and unverified suppliers. Aggregators change the game by curating networks of manufacturers who’ve already been vetted. When a buyer comes across an Indian SME listed on such a platform, half the battle – credibility – is already won.
Compliance without the headache
Certificates, export paperwork, ESG checks – these are the kind of things that stall deals. Digital sourcing marketplaces like rivexa step in with ready-made processes, so SMEs don’t get buried in red tape.
More than just a listing
It’s not only about visibility. Many aggregators bundle in logistics, trade finance, and supply chain tools. Individually, those services are hard to afford. Together, they give SMEs a fighting chance to scale globally without blowing up costs.
Policy Levers Driving Industrial Machinery Manufacturing SME Growth
Over the years, India has consistently signed FTAs with major markets that drive the growth of industrial machinery manufacturing SMEs.
Trade agreements opening doors
Recent FTAs with markets like the UAE and Australia are already paying off, giving Indian engineering exporters easier entry and fuelling double-digit growth in key destinations.
PLI schemes reshaping industries
PLI schemes covering 14 sectors, including machinery production, are pushing investment, capacity, and job creation. This policy tailwind strengthens India’s global positioning.
Finance flowing in
Another crucial point is the increasing credit access. In FY25, lending volumes to MSMEs are likely to cross INR 4.2 lakh crore, which is critical to fuel global ambitions.
Ready to Take Your SME Global?
Indian SMEs in industrial machinery are no longer on the sidelines. They’re becoming central players in global supply chains. Cost advantages, a skilled workforce, smarter technology, and stronger policy backing are all creating momentum.
rivexa streamlines the process of connecting global buyers to verified manufacturers in India. The digital export platform reinforces the supply chain that was once considered out of reach. Today, the key priority for SMEs is to adopt digital tools and establish the correct partnerships. rivexa continues to be that crucial link to expand to global markets.
Need reliable partners for Engineering goods sourcing? Contact our IG experts!
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