New Delhi:
The household appliances and consumer electronics industry expects in the upcoming budget an increase in customs duties on finished goods to discourage imports and facilitate import substitution, along with incentives for specific R&D and localization projects under the Productivity Incentives Scheme (PLI).
The nearly Rs 75,000 crore industry expects “certain enablers” that will encourage domestic manufacturing, the Consumer Electronics and Appliances Manufacturers Association (CEAMA) said.
“To further encourage local manufacturers, there should be a five percent differential levy between the parts and the finished goods. This will give the manufacturers much-needed incentives and help build a manufacturing base in India,” CEAMA Chairman Eric Braganza.
It has also called for a roadmap of the task structure for the LED industry over the next five years towards proper planning of investments and policy interventions.
“Two hundred percent weighted deduction for R&D (research and development) expenses is critical to sustaining the Indian manufacturer’s technological progress. In addition, incentives can be given under the PLI scheme for specific R&D and electronics localization projects,” he said.
The industry also expects the government to cut the GST on air conditioners to 18 percent load and also a similar cut for TV (screen size greater than 105 cm), Braganza added.
In addition, some makers also expect the government to further cut the GST bracket for energy-efficient products to 12 percent, a move that will not only help boost demand but also increase adoption of sustainable appliances — consistent with India’s commitment to climate change. goals.
The budget session will start on January 31 and Finance Minister Nirmala Sitharaman will present the annual budget on February 1.
Godrej Appliances Business Head and Executive Vice-President Kamal Nandi said the industry is struggling with unprecedented raw material prices, component shortages and moderate volume growth, especially in high-volume demand-side segments.
Consumer durables such as air conditioners, refrigerators and washing machines have become essential household items.
“We expect this budget to rationalize GST for these products. Air conditioners are still in the top tax bracket of 28 percent, which we expect will be reduced to 18 percent. Devices continue to languish when it comes to penetration levels, and lower taxes will help correct this. Greater penetration and volume will also boost production in these sectors,” he added.
Manish Sharma, CEO of Panasonic (India and South Asia), said the industry can expect an increase in import tariffs on fully built-up (CBU) audio products.
“Audio technology is an emerging segment and with new players entering the business, the demand and opportunities to meet it are always high. We expect a number of tariff barriers to audio to encourage domestic production,” said Mr. Sharma.
Likewise, TV screens larger than 105 cm are considered the premium category and have now become the most sought-after model.