The consumer durables industry is gearing up for the upcoming festival season amidst challenges of rising raw material costs and other inflationary pressures. Eric Braganza, President, Haier India, who has taken over as the new President of the Consumer Electronics and Appliances Manufacturers Association (CEAMA), believes the industry is expected to witness double digit growth in this festival season compared to previous festival season, despite the challenges.
CEAMA is the apex industry body representing the consumer electronics and home appliances industry and has been playing a key role in raising pertinent industry issues. The industry veteran has been appointed as the President of the industry body for the 2021-23 period.
Talking about the future goals of the industry body, Braganza said, “Our prime objective is to work closely with the government to grow the domestic market, build economies of scale, increase export competitiveness and make India a key manufacturing hub. We will need to look at all product categories carefully and see how we can develop a more robust component ecosystem to reduce dependence on imports and save valuable foreign exchange.”
“Just like the PLI scheme for AC components, I think more production-linked incentive schemes are required in other product categories to strengthen the Make-in-India initiative and the components ecosystem,” he said.
The industry body has also been urging the government to rationalise GST on air-conditioners and large sized TV above 32 inches to 18 per cent from the current 28 per cent to fuel the growth of the industry.
“I think the industry will witness a growth of 15–20 per cent during this festival season compared to the previous year,” he added.
Inevitable price hike
Responding to a query on challenges, Braganza said, “The industry is under pressure due to high raw material costs and a surge in other inflationary pressures such as in freight costs; further price hike is inevitable. But it’s difficult to take price hikes during festival season as it is a key sales period for the industry.”
Braganza noted that the consumer durables industry is poised to almost double in the next 5-6 years and hence the sector has the potential to become the engine of economic growth and create substantial job opportunities.
Despite the pandemic, factors such as pent-up demand helped the industry tide over some of the challenges in the past one-and-half year. “Consumers had limited avenues to spend during this time and so they focused on upgrading their appliances for a better lifestyle. But as other activities resume normalcy, these spends are likely to get diverted to sectors such as aviation, tourism and hospitality. So the industry could witness a bit of a slowdown in 2022. But we are hoping to see a strong summer season for ACs and other cooling products next year,” he added. The Hindu BusinessLine