Recommendations to MEITY work group on LED products by Kwality Photonics P Ltd and LEDChip Indus P Ltd

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Kwality Photonics has put India on the global LED map by setting up an ultra-modern fully-automatic LED plant with a capacity of a billion LEDs per year.

Image for representational purpose only

The 30 years young company has high brand equity in the domestic market. We have LEDchip Indus Pvt Lt india’s sole is a DIPP recognised start up enterprise at Hyderabad. The products are  technically called as LED packages.  LED  Semiconductor Components production since 1987 is outcome of the R&D  at IISC, BARC, TIFR & CEL since 1977.  

Current LED market in India

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Current LED market is the brightest spot ( pun intended)  in the otherwise difficult economy. As per latest view of our Association ELCOMA, the proportion of LED Lamps in Sales has increased. Last year LED business contributed to 54% of total Lighting sale and it is expected by end of 2017, this will be more than 70%.  This inspite of fact that the industry faced issues like Demonetization, GST, E-waste rules, MEITY CRO scheme etc which disrupted the sales from time to time.

Typical LED Components portfolio

For LEDs, the Lighting Segment is the major market now.  Of recent multiplicity of LED packages have converged into one size called 2835 SMD and we have created high production capacity in this 2835 LED. Popular are 2835 0.2Watt  for tubelights, 2835 0.5Watt for bulbs & Downlights,  and 2835/3030 1.0Watt.

LEDs &  the mission to ‘Make in India’

A late beginner India marched into LED Lighting in the giant strides of EESL, who played the role of Demand Consolidator and gave confidence to Indian Enterprises to invest in Huge capacities of LED assembly process & to supporting ancillary industries in Casting, Molding, MCPCBs,  & EMS. It created huge manual employment beyond any other industry and allowed wider diffusion of the knowledge and offered huge opportunity to many small time supervisors with enterprising outlook.  

The Lighting applications use entirely SMD LEDs which are difficult to solder manually. This ushered rapid adoption of mechanized soldering or SMT machines, which the industry was resisting since a decade due to fragmented volumes.

What  was conspicuous by absence was local production of LED components

The entire Electronic Component Industry was wiped out when the import duties became zero under ITA1996 in agreement. Some one has to come out of comfort zone and take the lead. As the senior player the market for LEDs, the Kwality Group took decision to make investments in scale that would put India firmly on the Global LED MAP. We adapted the most modern automation technology, poured our 40 years of expertise into the production process and succeeded in LED production at very competitive cost. Our vision is to reach 10 billion LEDs capacity rapidly and 100 billion capacity in short term. All our LEDs have LM80 compliance with 99 percent brightness retention after 9 month test at super high  temperatures of 105OC.

The Government Support will be critical

Generally it’s seen that There is little or low follow through enthusiasm or efforts from GOI or State Govts for the Make-in-India investment in LEDs. Currently our investments are put on hold due to Msips stipulations. We suggest that the applicant can be allowed to make investments once first application is registered on MEITY MSIPs online. If the make-in-India is unable to realise its full potential, despite India presenting a HUGE MARKET, and all this market going to benefit overseas producers of LEDs & Components.

Background  issues on LEDs:

LED components fall under the ITA1996 agreement of WTO, where in all 85 chapter hardware is subjected to zero duty. The LED raw materials have to imported essentially. Low weight makes airfreight cost  insignificant. The handicap cost for making in India is 12-15 percent. All this factors make it an ‘un-economic’ decision to make LEDs in India.

All LEDs sold in India are made in China practically, even of the major brands that are sold in India. As per our association ELCOMA’s data. last year the LED business contributed to 54 percent of total Lighting sale and is expected to exceed 70 percent be year end. India cannot afford supply disruption. India has to make its own LED components from supply-security point of view.  

In regard to LED lighting manufacture, India is already on a strong footing. India is producing all the mechanical housings, PCBS,  parts and the drivers for Lighting. LED components is the only missing item in ‘making their BOM 100 percent Indian’. Once LED component production happens locally, it creates pedestal for building indigenous investments for producing the leadframes, the silicone, the Phosphor. This will spur Taiwanese & Korean Chip makers to shift their LED Chip production to India to take advantage of the huge captive demand and Lowest engineer-manpower cost.  Within half a decade India can be the LIGHTING HUB for the world. Rising costs in China will support us and right kind of  vision  & support from GOI will make this happen sooner than later. Meity should form a task force / mission to realise this.

Every lighting manufacturer is putting lot of efforts to ‘make in India’  and they keep appealing to consumer to shun imports and patronise locally made brands. However they expect INDIA LEDs at 15-20 percent price advantage as a mindset, even if the test report show they are superior to overseas brands.

Unless Govt addresses this issue & Creates compulsory market for LED  made in india, meeting quality certifications ( LM80 is a de- facto accepted certification globally; Govt bearing the cost of certification of Indian LEDs to put them ahead in the queue) . Consequent wider patronage  to locally made LEDs to help build local capacities double quick time. It will go a long way for every one to move up the learning curve faster and propel India to leadership position in LED component.

Ever-changing technology in the LED space

LED technology is rapidly developing and the packaging innovations are happening all around. We are keen students of this field, have access to developments from all corners of the world and have access to technology innovators. Our investments are selected in a way to support emerging process like Flipchip, CSP, COB, DOB, SOB etc. If opportunity arises,  we will not hesitate to make India leapfrog to next generation Lighting Sources.  

LED as  lighting source is still limited to InGaN & other III-V elements. The micro LEDs & OLEDs are looking at non lighting applications. The LED lights are however upgrading to intelligent lighting and LiFi where they will play a dominating role in last mile communications.

Future plans

Kwality-LEDchip Indus P Ltd – are firmly engaged in the path to become No1 Global Scale producer of LEDs from India. We are going for innovative financing and scaling up to put India as a place to reckon as producer of professional grade LEDs.

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