September Tractor Shipments Jump 45% Amid GST Cut, Festive Buying Spree

India's tractor industry jumped in September 2025, with local shipments increasing 45% year-on-year at 146,180 units, based on data from the Tractor and Mechanization Association (TMA). Total sales, including exports, increased 43% at 154,417 units, versus 107,030 units during the corresponding month last year.

GST Reduction Sparks Demand Bump

The recent move by the Goods and Services Tax (GST) Council to reduce GST on farm equipment and tractors from 12% to 5% considerably improved the mood of buyers. This policy change, along with advance festive-season demand, propelled historic sales among major producers.

Mahindra & Mahindra Ltd., India's largest tractor manufacturer, registered 50% domestic sales growth, selling 64,946 units compared to 43,201 units in September 2024. With exports, the company shipped 66,111 units, showing a 49% year-on-year increase.

Mahindra Farm Equipment Business President Veejay Nakra attributed the boost to the GST reduction and pre-Navratri sales, highlighting better monsoon performance, higher crop acreage, and positive Kharif crop projections as drivers.

Escorts Kubota Sets New Sales Record

Escorts Kubota Ltd. (EKL) recorded its best-ever monthly sales, with 18,267 tractors sold in September. This is an increase of 47.6% over 12,380 units sold during the corresponding period last year. Domestic sales were up 48.5% at 17,803 units, and exports were up 17.5% at 464 units.

EKL credited the expansion to strong rural consumption, high water reservoir levels, and pre-festival expenditure, along with the recent revision of GST, which improved affordability considerably for small and mid-sized farmers.

Industry Sees Momentum Ahead of Diwali

Month-to-month, the sector recorded over 100% growth from 73,199 units in August to over 146,000 in September, reflecting a steep pre-Diwali surge. Analysts predict that the pace will be sustained in the rabi season, fueled by:

• Enhanced rural liquidity
• Favorable crop yields
• Government incentives for farm mechanization

The reduction in GST is itself estimated to cost farmers between Rs 40,000 and Rs 60,000 per tractor, allowing them to afford the vehicle with ease, especially for small farmers and rural businessmen.

Export Market Continues Onward Movement

Exports were also resilient, increasing 10% to 8,237 units from 7,488 units last year. This increase is consistent with strengthening global demand for cheap Indian farm equipment, particularly in Africa, Southeast Asia, and South America, where efforts to mechanize agriculture are on the rise.

Conclusion

With positive macroeconomic trends, lower taxation, and a festive season buying spree, India's tractor sector has reached a new growth level. The September 2025 performance confirms robust market fundamentals, and industry experts project growth to sustain through Q4 FY25 and beyond.

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