PLI scheme for ACs to boost production, value addition: ICEA

The production-linked incentive (PLI) scheme for air conditioners can help increase domestic value addition from current 25% to 75% and generate 24 million units annually in the next seven years, industry executives say.

“Since last twenty years, AC industry has travelled a journey from few thousands units to 7.0 millions air conditioners being sold as of last year, unfortunately component Ecosystem did not get developed,” said Jasbir Singh Chairman Amber Enterprises & Co-Chairman of ICEA’s Consumer Electronics and Appliances Committee.

“Today we continue to import critical components like Compressors, Aluminium, Copper Tubes, Motors, PCB, and Valves in majority. Out of 7.0 mill AC, approximately 5.0 mill AC were getting produced in India with only 25% local value addition. PLI is expected to have compounding impact of 25% value add on 5 mill ACs to go to 75% value add on 24 mill AC!s in next 7 years time,” he added.

The company has earmarked Rs 250-300 crores investment for participating in the scheme.

The government on Wednesday approved the scheme for white goods – Air Conditioners and LED Lights – with a budgetary outlay of Rs 6,238 crore.

ICEA chairman Pankaj Mohindroo said it will lead to incremental investment of Rs 7,920 crore, incremental production worth Rs 1,68,000 Crore, exports worth Rs 64,400 crore, earn direct and indirect revenues of Rs 49,300 crore and create additional four lakh direct and indirect employment opportunities.

Sunil Vachani Chairman Dixon Technologies, said, the scheme will enable a robust ecosystem for manufacturing components for the lighting industry and make India a global manufacturing hub.

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