Domestic Tractor Shipments Jump 45% in September 2025, Boosted by GST Cut and Festive Demand

Key Highlights

• Tractor sales up 43% YoY to 1.54 lakh units in September 2025.

• Domestic sales surged 45%, exports up 10%.

• Mahindra & Mahindra sales grew 50%, Escorts Kubota 47.6%.

• GST cut from 12% to 5% boosted demand.

• Early Navratri and strong monsoon supported growth.

India’s tractor industry witnessed remarkable growth in September 2025, with domestic shipments surging by 45% compared to the same month last year. The sharp rise was fueled by the recent Goods and Services Tax (GST) rate reduction on tractors and farm machinery, along with strong festive demand due to the early arrival of Navratri.

Also Read: India's Tractor Market Grows 28% in August 2025, GST Cut to Boost Festive Demand

Tractor Industry Reports Double-Digit Growth

According to data from the Tractor and Mechanization Association (TMA), total tractor sales in September 2025 climbed 43% year-on-year to reach 154,417 units, compared to 108,030 units in September 2024.

Domestic sales saw a massive jump of 45%, reaching 146,180 units, while exports rose 10% to 8,237 units, up from 7,488 units in the previous year.

Month-on-month, the industry’s sales more than doubled from August’s 73,199 units, highlighting strong momentum ahead of the Diwali festive season.

Mahindra & Mahindra Leads the Growth

The country’s largest tractor manufacturer, Mahindra & Mahindra Ltd. (M&M), posted an impressive 50% year-on-year growth in domestic tractor sales. The company sold 64,946 units in September 2025, compared to 43,201 units a year earlier.

Total sales, including exports, increased 49% to 66,111 units, compared to 44,256 units last year.

Veejay Nakra, President of Mahindra’s Farm Equipment Business, said the GST rate cut and early Navratri celebrations boosted tractor purchases. He added, “The Prime Minister’s decision to reduce GST rates led to increased buying during the first nine days of Navratri. A favorable Kharif crop outlook, higher cultivation area, and above-normal monsoon also supported strong demand.”

Escorts Kubota Achieves Record Monthly Sales

Escorts Kubota Ltd. (EKL) also achieved its highest-ever monthly tractor sales in September 2025. The company’s Agri Machinery Business Division sold 18,267 units, marking a 47.6% increase from 12,380 units a year earlier.

Domestic sales grew 48.5% to 17,803 units, while exports rose 17.5% to 464 units.

The company credited the growth to favorable rural conditions, strong water reservoir levels, and the early festive season, further supported by the GST reduction that improved market sentiment.

GST Rate Reduction Boosts Tractor Affordability

In a significant policy reform, the GST Council reduced the tax rate on tractors and farm machinery from 12% to 5%. Most tractors now fall under this lower bracket, while road tractors used for pulling semi-trailers (engine capacity above 1,800 cc) are taxed at 18%, down from 28%.

Industry experts estimate that the 7-percentage-point tax cut could result in savings of ₹40,000–₹60,000 per tractor, making them more affordable for farmers and rural entrepreneurs.

Strong Outlook for Upcoming Months

With improved liquidity, a positive crop outlook, and renewed government efforts to boost farm mechanization, analysts expect tractor demand to remain strong through the festive season and into the rabi sowing period.

The combination of tax relief, favorable monsoon, and festive buying has set a promising tone for the agricultural machinery sector, marking September 2025 as one of the best-performing months for India’s tractor industry.

Also Read: Kisan Mela 2025: Major Agricultural Fairs in UP, MP, and Uttarakhand This October

CMV360 Says

The Indian tractor industry saw exceptional growth in September 2025, driven by GST reduction, early festive season, and strong rural sentiment. With improved liquidity and a favorable crop outlook, tractor demand is expected to stay strong in the coming months.