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The Indian Fan Manufacturers' Association (IFMA) has urged the government to reduce GST on fans to 12 per cent rate from the current 18 per cent to make them more affordable especially for rural consumers.
This demand also comes at a time when the industry is gearing up for the mandatory implementation of the BEE’s energy efficiency norms for ceiling fans from July next year.
Speaking to reporters at the sidelines of IFMA's AGM, Rohit Mathur, President, Electric Fans and Pumps, Usha International and Past Chairman of IFMA said, “ With the implementation of the government’s rural electrification initiative, many consumers are buying fans for the first time in rural regions. Fans are a mass product and lowering GST to 12 per cent will make them more affordable especially for rural consumers.” He said the reduction in GST slab will help the industry invest in capacity expansion and adoption of new technologies.
The organised fans industry’s size is pegged at Rs 9000 crore in the country and it has been growing at 6-7 per cent year-on-year.
Atul Jain, Chairman, IFMA and Head-Fans BU and International Business at CK Birla Group said, "For the past 3-4 years, the organised fans industry has witnessed a growth rate of 6-7 per cent (y-o-y). We anticipate the industry to continue to see this kind of a growth trajectory as consumers are increasingly looking to upgrade to better performing fans with features such as IoT functionalities. Also, they are looking to replace fans in line with their home decor.”
"The real estate and housing sector is also one of the key growth drivers for the industry. We believe the government’s low income housing initiative is also beneficial for the industry ,” he added.
The industry is hoping that the GST reduction comes before the mandatory implementation of the energy efficiency norms. Companies will need to hike prices by 20-25 per cent once BEE norms become mandatory for ceiling fans.
"Currently, the energy efficiency norms for ceiling fans are voluntary. They are expected to become mandatory from July next year,” Mathur said adding that IFMA is in discussions with BEE (Bureau of Energy Efficiency) in this regard.
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