Total domestic tractor volumes stood at 64,322 units in August 2025, almost unchanged from 64,320 units in July 2025, but 28 per cent higher than 50,134 units in August 2024, according to data from the Tractor & Mechanization Association.
Industry analysts attributed the year-on-year growth in domestic volumes to an above-normal monsoon aiding kharif sowing, improved reservoir levels, an early festive season, and favourable terms of trade for farmers.
“The strong year-on-year growth indicates sustained rural demand, supported by active kharif sowing after a good monsoon. Lower interest rates are also aiding sales,” said Poonam Upadhyay, Director, Crisil Ratings.
Top tractor maker Mahindra & Mahindra reported domestic sales of 26,201 units in August 2025, up 28 per cent from 20,518 units in August 2024, but down from 26,990 units in July 2025.
Escorts Kubota recorded sales of 7,902 units in August 2025, up 27 per cent from 6,243 units in August 2024 and also higher than 6,624 units in July 2025. The company said the tractor industry sustained its growth momentum last month, supported by favourable rural conditions such as timely and widespread monsoon rains, strong reservoir levels, and an early start to the festive season.
Total tractor production stood at 101,943 units in August 2025, compared with 107,417 units in July 2025 and 104,329 units in June 2025. Export volumes rose to 8,877 units in August 2025, from 8,477 units in July 2025 and 8,599 units in August 2024.
With kharif sowing surpassing last year’s acreage and expectations of a timely GST rate cut on tractors and farm machinery before the peak festive season, industry sentiment remains strong, and demand is expected to improve further in the coming months.
GST on agricultural equipment has been reduced, with the rate on tractors below 1,800 cc cut to 5 per cent. GST on tractor parts, including tyres, tubes and hydraulic pumps, has been lowered from 18 per cent to 5 per cent.
Similarly, GST on sprinklers, drip irrigation systems, harvesting machinery and tractor parts has been brought down from 12 per cent to 5 per cent. Fixed speed diesel engines above 15 HP, threshing and harvesting machines and compost machines will also now attract 5 per cent GST, down from 12 per cent earlier.