Sri City in Andhra Pradesh is dubbed the “Cooling City” of India, accounting for nearly 40 per cent of the air conditioners (ACs) manufactured in the country.
On Tuesday, this industrial hub added one more feather to its cooling credentials. Carrier Air Conditioning and Refrigeration Ltd, the Indian arm of the oldest AC company in the world, Carrier Global, signed a deal to invest around ₹1,000 crore for a new manufacturing unit at Sri City.
According to an industry source, with the upcoming projects and expansions by LG Electronics and Daikin Air Conditioning India, the share of Sri City in India's AC manufacturing map may increase to 60 per cent by 2027, and to 70 per cent by 2028. Carrier Global Corporation is an American HVAC (heating, ventilation, and air conditioning) giant, which was started in 1915 by none other than Willis Carrier, who invented the first modern electrical air-conditioning system in 1902. At present, Sri City has a total of 10 HVAC manufacturers and around 32 suppliers in its ecosystem.
“Carrier’s ₹1,000 crore investment is a powerful validation of Andhra Pradesh’s ‘Speed of Doing Business’ approach. What makes this project even more special is that Carrier took just eight months from their first visit to the land handover and project finalisation — a timeline that reflects our commitment to swift decision-making and execution," said Nara Lokesh, minister of information technology (IT), electronics and communications, Andhra Pradesh, who led talks with the company.
The new Carrier facility will come up on 39 acres at Sri City and it aligns with Andhra Pradesh’s vision of attracting high-value, technology-driven industries while building globally competitive manufacturing clusters. The project will create around 1,000 direct and 2,000 indirect jobs. Carrier will be manufacturing commercial and industrial ACs in Sri City, and room ACs are not part of its production plans now.
"So far, Sri City has seen investments to the tune of ₹12,000 crore from 10 major AC manufacturers, creating 25,000 jobs. Similarly, 32 vendors together have invested ₹4,600 crore so far, creating 13,000 jobs in the region," Sri City Managing Director Ravindra Sannareddy told Business Standard.
Other than Carrier, LG and Daikin, the other AC manufacturers in Sri City are Blue Star Climatech, Havells India, Amber Enterprises India, Epack Durable, PG Technoplast, Hisense, and Thermax. The development of Sri City is giving an advantage to AC manufacturers in terms of access to the entire South India region, and also helping in better raw material inflow through nearby ports like Chennai, Krishnapatnam, and Ennore.
"The consumer durable capital for many years was the National Capital Region because of players like Samsung, LG, Carrier, and others. We were the first to acquire land and commission a factory in Sri City, as we were leaders in South India. Manufacturing from North India and transporting to South India adds another 4 per cent cost and also inventory holdings of another 10 days. Hence, a unit in South India is advantageous for all companies," said B Thiagarajan, managing director, Blue Star.
"When we moved in, I wanted a readymade factory. After that, Daikin, Amber, and LG all moved into that place. Since port access is there, exports are also happening. South India now is a significant market," Thiagarajan said, adding that the country needs to focus more on research and development (R&D) in the sector.
"We are not merely attracting investments. We are building globally competitive industrial ecosystems where companies can scale rapidly with confidence and policy stability," Lokesh added.
 "Carrier to invest ₹1,000 crore in Sri City as India's AC hub expands")
