 "Innovation is key for the consumer durables sector. PTI")
The Indian consumer durables market is at a crucial juncture with 2024 marking a year of transformation driven by increased household penetration and a rising preference for high-quality, energy-efficient products. While online shopping has grown in popularity, offline retail continues to hold its ground, providing consumers with hands-on experiences essential for high involvement purchases like consumer durables.
As we look ahead to Budget 2025, the industry eagerly anticipates reforms that can unlock further growth, strengthen local manufacturing and enhance affordability for Indian households. Strategic interventions in taxation, infrastructure and innovation could set the stage for sustainable progress in the sector.
Simplified tax structures for enhanced growth
One of the most pressing expectations from the upcoming budget is a simplified tax regime. Currently, the complicated tariff structure poses challenges for global competitiveness and impacts the export potential of Indian manufacturers. A streamlined tariff system can empower brands to expand globally, establishing India as a hub for consumer durables and electronics.
Furthermore, a reduction in GST on larger televisions, from the current 28 per cent to 18 per cent, is essential. Televisions have transitioned from being luxury items to household necessities, integral to India’s digital transformation. A lower GST rate would not only make premium home entertainment more accessible but also align with the government’s ‘Digital India’ vision, fostering wider adoption of advanced technology.
Expanding the scope of PLI schemes
The Production Linked Incentive (PLI) schemes introduced for smartphones, semiconductors and IT hardware have demonstrated their potential in boosting domestic manufacturing. Expanding these incentives to include categories like IoT devices, consumer electronics and wearables can provide a significant thrust to local production. Additional PLI outlays for the electronic component industry would further strengthen the supply chain, reduce dependency on imports and position India as a global manufacturing leader.
Impact Shorts
More ShortsTechnology-driven infrastructure
To support the integration of emerging technologies like AI, IoT, robotics, automation and 5G, the government must focus on building robust, technology-driven infrastructure. Investments in this area would enable manufacturers to adopt advanced technologies, enhance operational efficiencies and deliver cutting-edge products to consumers. Such advancements are critical for maintaining India’s competitiveness in the global consumer durables market.
Promoting innovation through R&D investments
Innovation lies at the heart of progress and targeted investments in research and development (R&D) are essential for fostering homegrown solutions. The industry expects the budget to prioritise a Public-Private Partnership model with dedicated funds for R&D initiatives. These efforts would not only spur innovation but also result in more affordable, high-quality products for Indian consumers over the long term.
Policies to promote local manufacturing
Policies that reduce taxes and encourage homegrown innovation will play a pivotal role in shaping the future of consumer durables in India. By promoting local manufacturing and supporting indigenous brands, the government can create a self-reliant ecosystem that drives economic growth while making India a preferred destination for global electronics manufacturing.
The Union Budget 2025 presents a vital opportunity to address the evolving needs of the consumer durables industry. Simplified tax structures, expanded PLI schemes and investments in R&D can propel the sector into its next phase of growth. By fostering innovation, boosting local manufacturing, and supporting global competitiveness, these reforms can solidify India’s position as a global leader while benefiting both brands and consumers.
Saket Gaurav is chariman & MD of Elista, a consumer durable brand. Views expressed in the above piece are personal and solely those of the author. They do not necessarily reflect Firstpost’s views.