Appliance industry sees restoration of concessional excise duty

The home appliances industry has demanded the restoration of concessional excise duty to the sector, at least for another year, in order to sustain the current growth momentum.

Appliance industry after three years of stagnation has witnessed double digit growth post announcement of concessional excise duty by the government in early 2014. In order to sustain this growth momentum it is expected that concessional excise duty be restored for this sector at least for another one year, says Kamal Nandi, business head and executive vice president of Godrej Appliances.

In the industry's budget wish-list presented to the finance minister, he said, this would also help promote the government's `Make in India' initiative.

In order to promote manufacturing in line with the 'Make in India' vision, the government must reduce customs duty on parts and components of refrigerator, washing machines, air conditioners and microwaves from current 7.5-10 per cent to `0' and make manufacturing in India more competitive than finished goods imports from FTA countries.

The energy labeling programme launched by Bureau of Energy Efficiency (BEE) has been very successful in bringing down energy consumption by appliances. These savings must be shared with manufacturers to support their investment for developing higher energy efficient products.

In order to further bring down energy consumption by appliances, consumers should be incentivised to purchase higher energy efficient products. The incentive can be passed on to them in the form of reduced sales tax or excise duty for higher energy efficient products.