The Indian Appliance & Consumer Electronics (ACE) industry is expected to have a CAGR of 9 percent over the next 5 years, predicts a recent PwC study, commissioned by CEAMA. However, given the low level of penetration of appliances and electronics when compared to global averages, exponential growth is possible. The industry will need to be part of the global supply chain, targeting not just the domestic customers but penetrating the export market in terms of size and scale, as its Japanese, Korean, and Chinese counterparts.

The outcome will require a multipronged approach: building scale by rapidly growing domestic consumption; creating (temporary) tariff barriers for the supply base to develop; imposing safeguard duties to ring fence imports from FTA countries; applying the phased manufacturing approach in ACE; correcting aberrations in GST which threaten domestic manufacturing; and addressing the high cost of finance. Policy and incentives will play an important role.

Manufacturing will need to step up. With support from the government, the industry aspires to increase the local value add by 2x–3x. This increase in value addition, apart from direct contributions to the country in the form of taxation, is expected to attract further investments from global players. Due to rising labor costs in alternative markets such as China and large domestic demand, global companies are turning their attention toward India as the next manufacturing destination. As other growing economies confront a rapidly graying population, India’s young population will not only offer a large consumer market but also fulfill the demand for a skilled global workforce.

This month, with air quality deteriorating to alarming levels in northern parts of the country, it was the turn of the air purifier to bail out the dealer fraternity. The air purifier market is poised to hit 400,000 units this year, from an average annual 200,000 units.

The month also saw Everstone submit a `1300-crore bid for Kenstar; Sharp planned a comeback with manufacturing in India at its Foxconn plants and marketing through the CE chain of Reliance Digital stores; and Daikin commenced operations at its second factory in Neemrana, Rajasthan.

From the Editor's Desk

From the Editor's Desk

Anju Arora

Anju Arora is the founder and managing director of ADI Media Private Limited, a business-to-business (B2B) information provider. ADI Media’s B2B products include Communications Today, Medical Buyer, TV Veopar Journal, and Broadcast & CableSat

She is an Economics Honors graduate from Lady Shri Ram College, New Delhi and PGDP from Indian Institute of Foreign Trade. She has also participated in the OPM Key Executives Program at Harvard Business School.

Anju Arora is also the co-founder and executive director on the Board of ADI BPO Services Limited, the majority shareholder in MPS Limited, listed on all the major India stock exchanges and a Macmillan company till 2011.