52 companies file applications for PLI Scheme for White Goods (ACs and LED Lights)

A total of 52 firms have applied for the PLI programme to promote local manufacturing of white goods components (air conditioners and LED lights), with a pledged investment of Rs 5,866 crore. Applications for the plan ended on September 15, 2021. The PLI Scheme was announced on April 16, 2021.

Several enterprises have applied to manufacture crucial components for air conditioners and LED lights, including Daikin, Panasonic, Hitachi, Mettube, Nidec, Voltas, Bluestar, Havells, Amber, EPack, TVS-Lucas, Dixon, R K Lighting, Uniglobus, RadhikaOpto, Syska, and others.

Components that are currently not manufactured in India with appropriate capacity have applications filed for their production. Compressors, copper tubing, aluminium foil stock, control assemblies for IDU or ODU, Display units, and BLDC motors are among the additional components used in air conditioners that are made by a number of different manufacturers. LED Chip packaging, LED Drivers, LED Engines, LED Light Management Systems, and PCBs, including metal-clad PCBs and wire-wound inductors, will also be manufactured in India for LED Lights.

An outlay of Rs. 6238 Crore has been approved on April 7th, 2021 by The Union Cabinet, which is chaired by The Hon’ble Prime Minister. The PLI scheme for white goods (air conditioners and LED lights) would be implemented during the next five fiscal years (FY 2021-22 to FY 2028-29). DPIIT made the offical announcement of the scheme  on April 16,2021. On the 4th of June 2021, the Scheme Guidelines were released. Online applications were collected from the 15th of June till the 15th of September of 2021. After the application window closes on 15.11.2021, the applicants will be selected within 60 days.

The PLI Scheme on White Goods is intended to create a complete component ecosystem for the air conditioner and LED lighting industries in India, as well as to make India an integral part of global supply chains. The Scheme will provide a 4% to 6% incentive on incremental sales for a period of five (5) years subsequent the base year and one year of gestation period.  The Scheme will only incentivize the production of components for ACs and LED lights.

The Scheme will incentivise the production of components for ACs and LED lights. The PLI Scheme covers 90 percent of the Bill of Material (BoM) of ACs and 87 percent of the BoM of LED Lights. It will result in an increase in value addition in the country from 20% to 80-85%, as well as the development of a robust component eco-system for the AC and Led Lights industries.

It will be necessary to choose companies for the Scheme in order to promote the production of components or subassemblies that are not produced  in India with adequate capacity. Mere assembly of finished goods is not being incentivized.

A total of INR 2,71,000 crore of AC and LED component manufacture is projected over the next five years thanks to the Scheme. The initiative will add INR 5,886 crore to the AC and LED lights industry’s component manufacturing eco-system. For AC Components, 31 companies have committed Rs 4995 crore in investments, while for LED Components, 21 companies have committed Rs 871 crore in investments.

In the next five years, the programme is expected to create 2 lakh new job opportunities, both directly and indirectly.

There is an expectation that Domestic Value Addition will increase from the present 15-20% to 75-80%.