The government and the World Bank will work on a "comprehensive" project, entailing "significant" investments to promote manufacturing and availability of affordable cooling devices in the domestic market, a top official said on Monday.
Secretary in the Department for Promotion of Industry and Internal Trade (DPIIT) Rajesh Kumar Singh said that the objective of the proposed project would be to cater to both the demand and supply side of the sector.
The project will cover areas such as capacity building, introducing or disseminating better technologies for supper efficient air-conditioners, he said.
Demand for these products is going to increase multi-fold in the country in the coming years on account of the increasing intensity and frequency of severe heat waves in India.
"We will upload the DPR (detailed project report) very soon for a project with the World Bank, with significant investments both from the World Bank side as concessional lending and an equal amount from the Government of India," Singh said here at a workshop on alleviating heat stress by enhancing production of affordable cooling devices here.
He asked the industry to give feedback on the kinds of interventions required, both from the demand and supply side, for the sector.
"We are about to start work on a project which will hopefully come with some of those supply and demand side measures ... in bringing about tangible investments and interventions in this area, not only in the private sector manufacturing but also in areas like R&D, capacity building etc. This will be a comprehensive project that we will start working on," Singh added.
He said that the super-efficient ACs are 30-40 per cent better than the 5-star ACs available in the market.
Heat waves are going to be a big problem for the world and there is a need to start addressing it right away, Singh said adding AC penetration in India is 5 per cent and going forward if it reaches the global average of 30-per cent, the demand for cooling devices will explode.
"Because of that, the global warming issue will be there...carbon footprint will increase. So we need to work in this area with the ministries of environment, science and technology, and the World Bank-like institutions so that we can have at least cutting edge, super-efficient, cooling technologies," he said.
Initially, super-efficient cooling devices may be costlier, so there is a need to bring in scale on the production side and for that "we may" have to do some kind of intervention, the secretary said.
From the supply side, the government may consider providing viability gap funding to the industry. The focus of the project would be to bring in more energy efficiency as cooling demand will increase in India.
"We have to work on both supply and demand interventions... we have to analyze and after that if we need resources, we will have to work on that," Singh added.
The government has already rolled out a production-linked incentive (PLI) scheme to boost manufacturing of AC and LED light components, with an outlay of Rs 6,238 crore.
Besides PLI, the government has to look at other supply-side measures going forward for providing some kind of viability gap funding to the industry for bringing about this transition through new technologies that are available.
Citing the example of airconditioner maker Daikin, he said there is a need to see how energy-efficient products can be brought into the domestic market in large numbers and how consumers can be attracted towards that.
Singh emphasised the importance of these cooling devices in the market as it would help promote sustainable and environmentally friendly habitation.
Speaking at the conference, Joint Secretary of the DPIIIT Sanjiv said that climate-friendly cooling devices are the need of the hour.
He also asked the PLI beneficiary firms to file their claims and get fiscal incentives.
The workshop aims to bring together key stakeholders, including companies providing cooling solutions, industry experts, start-ups, innovators, government representatives, academics, researchers, and civil society participants.
It will encompass discussions on retail space cooling (efficient fans and air conditioners), centralized space cooling (chillers and district cooling systems), and cold chains.
It is being organised by the DPIIT in collaboration with the World Bank with the objectives to identify constraints for domestic manufacturing of cooling technologies and components for both- cooling solution providers and their respective supply chain manufacturers; and determine necessary policy initiatives to address these constraints and accelerate domestic manufacturing.