The Indian Appliances and Consumer Electronics (ACE) market are expected to almost double in the upcoming three years and reach around Rs 1.48 lakh crore by 2023. This is being led by increasing domestic demand, said the industry body CEAMA.
India has become one of the fastest growing ACE markets in the world and is further emerging as an alternative manufacturing destination of China and other South East Asian countries, the president of the Consumer Electronics and Appliances Manufacturers Association (CEAMA), Eric Braganza, said.
The foreign direct investment in the ACE industry has also almost doubled to $481 million till June 2022 as compared to $198 million in 2021, he added.
Braganza further added that several global OEMs are setting up their base in India now. This has been supported by initiatives like the PLI scheme in ACs.
He, however, added that similar PLI (Productivity-Linked Incentives) for other categories like small and larger appliances and other products, will further boost domestic manufacturing and create more job opportunities.
"We look forward to more PLI schemes in other product categories, which will strengthen the component manufacturing base in India to reduce dependence on imports, thereby propelling the clarion call on ‘Aatmanirbhar Bharat’," said Eric Braganza.
The market size of the ACE industry is currently estimated at around Rs 75 lakh crore.
According to Braganza, the penetration of the ACE industry is still low in several categories in comparison to other global markets and India has a lot of headroom for growth.
“Last two years were not good for the growth of the industry due to Covid. However, the industry is now back to growth and this summer, compressor-based cooling products have performed well,” he added.
The industry is very optimistic and has the desire to adopt new technology and manufacture locally under Make-in-India. Several startups are also adding value to the industry.
Presently, the industry is witnessing a premiumization trend across the market, having higher sales from the premium and mid-premium and entry-level going down, he added.
However, Braganza also urged for some policy-level support from the government over taxation under the present GST regime.
He asked for unanimity of GST slab for TV and said presently TV up to 32-inch screen size is under 18 percent bracket. TV with screen sizes over 32 inches are levied a GST of 28 percent.
Braganza also urged the government to put the energy-saving Air-conditioner models from the highest bracket of 28 percent to 18 percent.