KOLKATA: Television makers LG, Samsung, Panasonic, BPL, TCL and Sanyo are reviving their ‘Make in India’ plans after the government halved the customs duty on open cell panels, which account for two-thirds the cost of assembling LED sets.
After a 10% duty was imposed on open cell panels in the budget, leading companies and contract manufacturers shelved plans to assemble TVs locally. They contended it would be cheaper to import ready-touse television panels from South Korea, China and Southeast Asian countries on concessional duties as per India’s trade agreements than to assemble them locally. Open cell panels require final assembling to make the LED television panel.
The Consumer Electronics and Appliances Manufacturers Association (CEAMA) now expects investments of over `1,000 crore in assembling of television panels and manufacturing and several thousand jobs to be generated over the next one year.
“The reduction of duties will revive local manufacturing, which was at risk since all companies had reviewed their decision against it,” Dixon Technologies chairman and CEAMA vice-president Sunil Vachani said. As per estimates, assembling about 1 million television sets a year creates 600-700 jobs.
CEAMA president and Panasonic India CEO Manish Sharma said there will be an investment of about `250-300 crore in the next three to four months. “Around 25-30% of total TV production in India is done on open cell assembling, which will go up substantially. Moreover, since prices will now come down due to the reduction of duties, it will boost demand, which, in turn, will create additional manufacturing capacities,” Sharma said.
So does contract manufacturer Super Plastronics, which will invest over `150 crore to expand capacity due to increased assembling queries, said CEO Avneet Singh Marwah. Optiemus Group, which assembles smartphones, is entering the television space as well.
The government reduced customs duty on open cell panels from 10% to 5% on Friday.
Samsung and LG, the country’s two largest television makers, had earlier this year set up open cell panel assembling units after the government imposed 15% custom duty on ready-to-use TV panels and 20% on completely built units in December.
Another senior CEAMA member said LG and Samsung will now start their local production plans afresh since they too had been looking at importing panels from Korea.
“On Saturday they even discussed internally expansion of open cell production, especially for large sizes, which are still imported,” he said. Emails sent to LG and Samsung remained unanswered. Online focussed brands such as BPL, TCL and Sanyo will take the opencell route for local production.
Chinese brand TCL India regional director Praveen Valecha said the duty rollback has made it determined to invest in manufacturing in India. “We might be in a position to request the government to further increase duties on completely built units from 2019-20 to make the manufacturing investment viable here,” he said.
BPL chief operating officer Manmohan Ganesh said there will be an 8-9% cost advantage to assemble in India than to import.