India's engineering exports saw a notable increase of 4.86% in FY26, totaling $122.43 billion, despite facing significant challenges from geopolitical tensions in the Middle East. Exports to the UAE plummeted by 66.8% to $237.4 million, while shipments to Saudi Arabia dropped by 45% to $247.7 million in March 2026. This decline was attributed to disruptions in cargo ship movements due to the crisis. However, overall engineering exports in March rose 1.13% to $10.94 billion. The U.S. remained the largest destination for Indian engineering goods, with exports increasing by 2.3% to $19.6 billion. Key contributors to the export growth included motor vehicles, copper products, and iron and steel. Looking ahead, industry leaders emphasize the need for market diversification and targeted policies to maintain export momentum and achieve long-term targets.