India's Tractor Sales Hit Record 11 Lakh Units, Up 20%
Overview
India's tractor industry achieved a historic milestone in 2025, surpassing one million domestic sales for the first time with 10.9 lakh units sold, marking a 20% surge from the previous year. Exports also saw a strong rebound. Favorable monsoon conditions and a GST rate cut significantly boosted demand and affordability.
Tractor Sales Soar to Historic Highs
The Indian tractor industry concluded 2025 with unprecedented domestic sales, breaching the one-million-unit mark for the first time. Annual volumes reached 10.9 lakh units, a substantial 20% increase over the 9.1 lakh units sold in 2024. Exports also demonstrated robust recovery, crossing the one-lakh-unit threshold after a two-year hiatus. This performance signifies a strong revival in the agricultural machinery sector.
Key Growth Drivers Identified
Several factors converged to fuel this remarkable growth. The Tractor & Mechanisation Association (TMA) reported that favorable agricultural conditions played a crucial role. The southwest monsoon in 2025 delivered rainfall at 108% of the long-period average, creating a generally positive environment for the farm economy. Although rainfall distribution was uneven, adequate precipitation supported crop sowing and improved yield expectations, directly translating into healthier farm cash flows and a more optimistic rural sentiment.
GST Reduction Boosts Affordability
Further impetus came from the reduction in the Goods and Services Tax (GST) rate on tractors to 5%, effective from October. This policy change led to a noticeable decrease in tractor prices, with savings ranging from approximately ₹40,000 to ₹1,00,000 across various horsepower segments. This price adjustment made new tractors significantly more accessible to farmers, driving purchasing decisions and contributing to the surge in sales. December 2025 alone saw domestic tractor sales climb to 69,890 units, a significant jump from 50,993 units in December 2024.
