Top global brands rush to produce ACs, LEDs under Make in India

In response to government's production linked incentive (PLI) scheme to boost the production of white goods, 31 companies have committed investments of about Rs 5,000 crore for manufacturing of AC components and 21 companies have committed investments of Rs 871 crore for LED components, writes ETV Bharat Deputy News Editor Krishnanand Tripathi.

New Delhi: In an encouraging response to the government's production linked incentive (PLI) scheme to boost the production of white goods, 52 companies, including some of the biggest global brands, have applied for the PLI scheme to produce air conditioner parts and LED lights in the country. These companies have committed an investment of more than Rs 5,800 crore.

According to an official estimate, it will lead to the production of white goods worth Rs 2.71 lakh crore in the country in the next five years.

Officials said several top companies like Daikin, Panasonic, Hitachi, Mettube, Nidec, Voltas, Bluestar, Havells, Amber, EPack, TVS-Lucas, Dixon, R K Lighting, Uniglobus, Radhika Opto, Syska among others have applied for manufacturing critical components of Air conditioners and LED lights.

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Thirty-one companies have committed investments of about Rs 5,000 crore for manufacturing of AC components and 21 companies have committed investments of Rs 871 crore for LED components.

Applications have been filed for the production of components that are not manufactured in India in good quantity.

For Air conditioners, several companies will be manufacturing compressors, copper tubing, aluminium stock for foils, control assemblies for IDU or ODU, Display units, BLDC motors among other components.

Similarly, for LED lights LED chip packaging, LED drivers, LED engines, LED light management systems, PCBs including metal clad PCBs and wire wound inductors will be manufactured in the country.

PLI scheme for white goods

In April this year, the government approved a PLI scheme for the white goods sector with an outlay of Rs 6238 crore for the next five years.

The scheme was notified by DPIIT in April this year and the deadline for submission of the application was September 15.

The government will take a decision on these applications within two months.

“Selection of companies for the scheme shall be done so as to incentivize manufacturing of components or sub-assemblies which are not manufactured in India presently with sufficient capacity. Mere assembly of finished goods is not being incentivized,” said the officials.

The PLI scheme for white goods is designed to create a complete ecosystem for air conditioners and LED lights industry in India and make the country an integral part of the global supply chains.

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The scheme offers an incentive of 4% to 6% on incremental sales for a period of five years. Only the manufacturing of components of ACs and LED lights will be incentivized under the scheme.

The scheme is expected to generate nearly 2 lakh direct and indirect employment opportunities over the next five years and domestic value addition is expected to grow from the present 15-20% to 75-80% of the value of the finished product.