Chi­nese LED prod­ucts seek to brighten India

China Daily (Hong Kong) - - BUSINESS - By LI WENFANG in Guangzhou li­wen­fang@chi­

Twenty light­ing prod­uct man­u­fac­tur­ers in Guang­dong plan in­vest in a light-emit­ting diode or LED in­dus­trial park in India.

The idea is to tap the vast mar­ket po­ten­tial and lower costs in the pop­u­lous South Asian coun­try.

Led by the Guang­dong Solid State Light­ing In­dus­try In­no­va­tion Cen­ter, the group of man­u­fac­tur­ers is talk­ing with sev­eral states in India for the project.

Two states have al­ready held talks: Gu­jarat, the home state of In­dian Prime Min­is­ter Naren­dra Modi, and Ra­jasthan, both in western India. The agree­ment on the project is ex­pected to be signed in the first half of next year.

The pro­posed project is es­ti­mated to gen­er­ate an­nual out­put of $596.88 mil­lion, said Gui Shi­rong, di­rec­tor of the cen­ter.

To­tal in­vest­ment for the planned park is es­ti­mated at $2.98 bil­lion, half of which would come from the par­tic­i­pat­ing en­ter­prises. The rest is ex­pected to be in the form of low-in­ter­est loans and sup­port via ad­vance pur­chase or­ders, Gui said.

The Chi­nese en­ter­prises in­volved in­clude those en­gaged in the man­u­fac­ture of LED-based dis­plays, road lamps, and house­hold and com­mer­cial light­ing prod­ucts, chip pack­ag­ing, and sup­port­ing in­dus­tries.

As the largest LED-strong Chi­nese prov­ince, Guang­dong houses more than 10,000 re­lated com­pa­nies, or 60 per­cent of the na­tional to­tal. Its bil­lion yuan bil­lion LED out­put surged from 38 bil­lion yuan ($5.6 bil­lion) in 2009 to 415.6 bil­lion yuan last year, in­clud­ing ex­ports worth 126 bil­lion yuan.

The prov­ince had re­placed more than 4 mil­lion road lamps with LED prod­ucts by the end of last year, sav­ing en­ergy by 55 per­cent, a record that can be repli­cated in other coun­tries, he said.

This is par­tic­u­larly true for India where LED con­sump­tion is less than 5 per­cent of that in China. But things are chang­ing.

Cer­tain brands such as Philips, Os­ram, Havells, Wipro, Ba­jaj, Eveready, Syska, Oreva, Moser Baer and Surya are al­ready slug­ging it out in the In­dian LED mar­ket.

Yet, LED ex­ports from Guang­dong to India grew rapidly to $644 mil­lion last year, up 148 per­cent year-on-year.

Ac­cord­ing to Re­search and Mar­kets, India’s LED mar­ket is fore­cast to reach $1.4 bil­lion by 2019.

“Gov­ern­ment ini­tia­tives to re­place in­can­des­cent bulbs with LED bulbs, in­creas­ing en­ergy de­mand sup­ply gap, de­clin­ing prices are the fac­tors driv­ing the growth of LED light­ing in India. Street light- ing ap­pli­ca­tion ac­counts for ma­jor­ity of the mar­ket rev­enues in In­dian LED light­ing mar­ket... LED light­ing mar­ket will ac­count for 32 per­cent of the over­all India’s light­ing mar­ket rev­enues by 2019.”

Ac­cord­ing to Frost & Sul­li­van, a busi­ness con­sult­ing firm, by 2021, the LED tech­nol­ogy is es­ti­mated tol pen­e­trate 57 per­cent of the light­ing mar­ket in India.

The pro­posed Chi­nese LED park in India is ex­pected to help ad­vance LED in­dus­tri­al­iza­tion, up­grade the LED tech­nol­ogy and pop­u­lar­ize LED light­ing prod­ucts in the coun­try, and cre­ate an in­dus­trial cluster in the state where the park would be even­tu­ally lo­cated.

It is also es­ti­mated to cre­ate about 10,000 lo­cal jobs.

As an emerg­ing mar­ket with a big pop­u­la­tion, India has room for tak­ing the LED man­u­fac­tur­ing ca­pac­ity, said Liu Jisen, vice sec­re­tary-gen­eral of the Guang­dong In­sti­tute for In­ter­na­tional Strate­gies.

Mas­sive pro­duc­tion should help India de­velop its LED in­dus­try and bring down the price to in­crease af­ford­abil­ity. The pro­mo­tion of en­ergy-sav­ing LED prod­ucts should help India ad­dress its sus­tain­able devel­op­ment is­sue, Liu said.

Apart from India, the mar­kets in Brazil, Africa, Viet­nam, In­done­sia and East Europe also have po­ten­tial for sim­i­lar LED in­dus­trial parks, Gui said.

Build­ing on the mas­sive ca­pac­ity, the LED in­dus­try of Guang­dong has also em­barked on tech­no­log­i­cal in­no­va­tion and up­grad­ing, invit­ing par­tic­i­pa­tion by in­sti­tu­tions from ad­vanced economies, he said.

to­tal in­vest­ment for the planned park Guang­dong’s LED out­put last year

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