Boosting domestic LED manufacture has been a recurring topic of discussion amongst policy makers and those in the industry. DeitY and PHD-CCI recently organised a conference that focused on what is being done and needs to be done to encourage LED manufacturing in India
September, 2015
Domestic LED manufacturing has become a priority for the government and the industry has responded positively by gearing up to meet expectations. The Department of Electronics and Information Technology (DeitY), along with the PHD Chamber of Commerce and Industry (PHD-CCI) and the Ministry of Communications and IT, organised a conference on ‘Make in India: Bright Prospects for LED Manufacturing’ in July this year.
The growing application areas for LEDs have made them a viable primary lighting option, with significant market penetration even in the rural areas, where there is little awareness about them. With LED technology gaining prominence in the global market, it is time for Indian manufacturers to think of more avenues to implement it, said Alok B. Shriram, president, PHD-CCI, at the conference. He suggested that attention should be given to the use of LED products that significantly reduce the power burden across states, which is a major national challenge today. There is also a need to lower the certification fees to obtain BIS standards, especially for MSMEs in the electronics industry, as the current charges are very high.
Envisioning a bright future for LEDs in a growing market like India, Dr Ajay Kumar, additional secretary, DeitY, Ministry of Communications and IT, said that apart from institutional and commercial demand, retail demand for LEDs has also increased substantially.
Dr Kumar listed the following three factors as crucial for the development of LED technology:
- New programmes of the government—‘Smart Cities’ and ‘Digital India’
- The economic development of India, which will push a lot of people towards the technology
- Rural areas will generate significant demand as the energy consumption is less
While manufacturing in India does indicate considerable progress in this field, considering that the domestic industry earlier depended heavily on imports, Dr Kumar reiterated that the government was also keen on developing LED designs indigenously. This would provide a completely new value proposition to the domestic as well as the export market. LEDs have evolved with respect to design over the last five to seven years, due to the use of different materials.
In the past one year, investments worth ₹ 1100 billion for electronics manufacturing have been committed under the MSIPS (Modified Special Incentives Package Scheme) and DeitY has set an ambitious target of ₹ 6600 billion worth of investments by 2020. Vivek Seigell, director, PHD-CCI, mentioned that India’s electronics imports grew at a rate of 26 per cent in 2014-15 to US$ 22.14 billion from US$ 17.59 billion in 2013-14.
Electronics exports from India witnessed a negative growth of 20 per cent, down to US$ 2.09 billion in 2014-15 from US$ 2.61 billion in 2013-14.
Domestic manufacture of LED components still remains an area of concern. Seigell added that the LED imports into India grew at 69.2 per cent to US$ 222.3 million in 2014-15 from US$ 131.35 million in 2013-14, while LED exports from India grew at 22.6 per cent to ₹ 8.74 billion in 2013-14.
Dr Kumar said that the government has taken various steps to boost electronics manufacturing in India. These include:
- Extension of MSIPS for another five years. Also, the new version of the MSIPS has removed or simplified various tricky clauses to boost investor sentiments
- The Electronics Development Fund (EDF) would become operational within a month to support venture capitalists and to fund electronics manufacturing
- Setting up of the National Centre for Flexible Electronics (in which LEDs will be an important vertical) at IIT Kanpur. The centre will take up projects only if there is industry participation
- Financial support in the form of Joint Collaborative Research Grants will be available from DeitY for firms working with a foreign company
Dr Kumar urged the Bureau of Indian Standards (BIS) to check the import of sub-standard LEDs into India since this poses a threat to quality. Keeping a check on this trend will bolster domestic LED manufacturing and establish Brand India globally. Dr Kumar also emphasised the possible export opportunities for LED products. To boost exports, DeitY has requested the Ministry of Commerce to include developed countries under the purview of the Market Access Initiatives (MAI) scheme, apart from the developing countries that are currently covered.
Proper disposal mechanisms are a must for any lighting product that needs to be recycled as per stipulated guidelines. Currently, LEDs are the easiest lighting source to dispose of or recycle, since they are free of toxic materials. They do not come with any of the disposal issues associated with fluorescent lamps. This warrants the use of LEDs at multiple levels. Airing these views, D.K. Nayyar, deputy director general – standards, Bureau of Indian Standards (BIS), said that there was a need for LED products to be made affordable for the common man, taking energy efficiency levels higher.
He sought participation from industry to set up national quality standards and mentioned that the Indian LED manufacturing sector can benefit immensely by complying with these. Nayyar assured those at the conference that BIS, in association with all industry stakeholders, will work together to provide the requisite platform and necessary support to achieve the holistic growth of the sector as well as overall consumer satisfaction.
Seigell made a special mention about the Electronics Development Fund (EDF), which could be in excess of  ₹ 100 billion and could help to further increase investments in the electronics sector. He also congratulated Dr Ajay Kumar for attracting ₹ 11 billion worth of investments through MSIPS and expressed hope that DeitY would be able to attract even more investments through this scheme in the next five years.
PHD Chamber of Commerce and Industry organised a conference on ‘Make in India: Bright Prospects of LED Manufacturing’ on 14th August 2015 in New Delhi. The Conference was presided over by Dr. Ajay Kumar, Additional Secretary, Department of Electronics and Information Technology (DEITY), Ministry of Communications and IT, Government of India and a special address was given by D K Nayyar, deputy director general-Standards, Bureau of Indian Standards (BIS).
Post conference PHD Chamber presented the following recommendations to Bureau of Indian Standards coming out of the Conference for benefit of Electronics System Design and Manufacturing (ESDM) Sector:
- Reduction in imports of sub standard LEDs: Bureau of Indian Standards must work on reduction of imports of sub standard LEDs to India. Currently a significant proportion of low quality LEDs are sold in India which affects the consumer. This step will ensure quality products meeting defined Standards are sold in India. This can be achieved by the already initiated steps like making the standards and specifications mandatory. BIS may like to initiate more steps in this direction.
- Low BIS Certification Fee for LED products: LEDs are a small product unlike computers, severs. A high BIS Certification fee would affect the domestic manufacturing as well as the end consumer. Low BIS certification fee would boost investor sentiment in the sector and subsequently demand.
- Low BIS Certification Fee across product categories for MSMEs: To promote manufacturing by MSMEs, lower BIS certification fee across product categories should be pursued by the BIS.
By LEDB Bureau
