Dixon, Hindalco, Daikin and 49 others apply for PLI scheme for white goods

As many 52 global and domestic companies have filed applications and committed investment worth Rs 5,866 crore towards production-linked incentive (PLI) scheme for white goods--air conditioners (ACs) and LED lights.

Companies such as Daikin, Hindalco, Panasonic, Hitachi, Mettube, Nidec, Voltas, Bluestar, Havells, Amber, EPack, TVS-Lucas, Dixon, R K Lighting, Uniglobus, Radhika Opto, Syska among others have applied for manufacturing critical components of air conditioners and LED lights.

The budgetary outlay of the scheme is Rs 6,238 crore. Any unutilized amount from the scheme allocation will be reviewed later.

As many as 31 companies have committed investments of about Rs 4,995 crore for AC components and 21 companies have committed investments of Rs 871 crore for LED components.

While the scheme was notified four months ago, applications for the PLI scheme for white goods closed on 15 September.

Anil Agrawal, additional secretary at  the Department for Promotion of companies, has applied to get incentives for production of components, which are currently not manufactured in India with sufficient capacity.

For ACs, several companies will be manufacturing compressors, copper tubing, aluminium stock for foils, control, display units, among other components. Similarly for LED Lights, LED Chip packaging, LED drivers, LED engines, LED light management systems, wire wound inductors, among others will be manufactured in India.

"The PLI Scheme on white goods is designed to create a complete component ecosystem for air conditioners and LED lights industry in India and make India an integral part of the global supply chains. The scheme shall extend an incentive of 4 per cent to 6 per cent on incremental sales for a period of five years subsequent to the base year and one year of gestation period," an official statement said.

Only manufacturing of components of ACs and LED Lights will be incentivised under the scheme, assembly of finished goods will not, Agrawal told reporters.

The scheme will be implemented over the financial year 2021-22 to 2028-29 with an outlay. The scheme guidelines were published on June 4. Applicants will be shortlisted The selection of applicants will be done within 60 days from the date of closure of application window--15 November.

"Ninety per cent Bill of Material (BoM) of ACs and 87 per cent of BoM of LED lights are covered under PLI scheme. It will lead to increase in value addition in country from 20 per cent to 80-85 per cent and developing a robust component eco-system for the AC industry and LED lights Industry," the statement said.

Over the next five years, the scheme is expected to result in total production of about Rs 2.71 trillion of components of ACs and LEDs.

The scheme will generate approx. 200,000 direct and indirect employment opportunities over the next five years. Domestic value addition is expected to grow from the current 15-20 per cent to 75-80 per cent.