The foreign direct investment in the ACE industry has almost doubled to USD 481 million till June 2022 as against USD 198 million in June 2021
New Delhi: The Indian Appliances and Consumer Electronics (ACE) market is expected to almost double in the next three years to around Rs 1.48 lakh crore, led by increasing domestic demand, said the industry body Consumer Electronics and Appliances Manufacturers Association (CEAMA).
India has become one of the fastest-growing ACE markets in the world and is also emerging as an alternative manufacturing destination of China and other South East Asian countries, CEAMA president Eric Braganza, said.
The foreign direct investment in the ACE industry has also almost doubled to USD 481 million till June in 2022 as against USD 198 million in 2021, he added.
“Now several global OEMs are setting up their base in India,” said Braganza while addressing the annual function of CEAMA here.
This has been supported by initiatives like the Productivity-Linked Incentives (PLI) scheme for air conditioners (ACs).
He, however, added that similar schemes for other categories like small and larger appliances and other products, will further boost the 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,” he said.
The market size of the ACE industry is currently estimated at around Rs 75 lakh crore.
According to Braganza, the penetration of 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 optimistic and desires 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 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 TVs and said presently TVs up to 32 inch screen size fall under the 18 per cent GST bracket. TV with screen size over 32 inches are levied a GST of 28 per cent.
Braganza also urged the government to put the energy saving AC models from the highest bracket of 28 per cent to 18 per cent.
Braganza was speaking at the 43rd annual function of CEAMA, which was also attended by The Commerce & Industry Minister Piyush Goyal.