Dixon Technologies Chairman Sunil Vachani has said that the consumption story for white goods in the country needs a boost. The former president of the Consumer Electronics and Appliances Manufacturers Association (CEAMA) argued that the consumption of such products should witness a lot more growth given the low penetration levels.
Speaking on the sidelines of CEAMA’s 45th annual function, Vachani told reporters that given the low penetration of white goods like washing machines, air conditioners, and refrigerators, there should be hyper-growth, which is not happening. “The industry needs to make products more affordable. Work is in progress in this segment,” he said.
As per Vachani, the industry would need help from the government to cut costs which will in turn reduce prices for consumers. “A lot more needs to be done to boost consumption. We need a reduction in GST and relaxation of tariffs on components and commodities to cut costs,” he said.
Consumption growth in the economy has been a matter of big debate given the fact that the Indian economy is undergoing a sharp slowdown. As per the latest official estimates, GDP growth is expected to slow down to 6.4% in this fiscal year from 8.2% in the last fiscal year. In this background, the industry is hoping for a boost in the upcoming Union Budget, which will be presented by Finance Minister Nirmala Sitharaman on February 1.
Vachani pointed out the size of the Chinese market and said that the potential for growth in the country is similar. “China’s market is 8-10x of ours in this space. However, the growth levels here are still very muted,” he said.
Along with relaxation in taxes and tariffs, the industry body has also asked for more time to comply with Quality Control Orders (QCOs) which restrict imports of substandard products.
The push for impetus in the growth of electronics products comes as the industry races to achieve the government’s target of electronics manufacturing worth $500 billion by 2030. In 2023-24, India’s total manufacturing output stood at $660 billion.
While the target may look ambitious given the lack of hyper-growth, Vachani argues that there is a lot that could change. “A new regime is coming in America. We have seen new companies rushing to India since the announcement of results a couple of months back. A large part of the target will come from exports as and when big companies start sourcing from India,” the Dixon Chairman noted.
