Reduce tax burden and increase fund for R&D in HVAC

By OEM Update Editorial June 17, 2019 5:42 pm

In an interaction with Thermal Control Business Update, Aayush Jha, Founder & CEO, Clairco, says that although the Make in India initiative has helped the manufacturers, and Digital India has done very little for the HVAC industry.

Make in India made for India’s HVAC sector?
A lot of new companies have recently come up with different HVAC solutions. Massive manufacturing plants have been setup in Gujarat and elsewhere. E-commerce companieshave launched their own brands and consumer durables such as air-conditioners. This has probably been possible to quite some extent due to the Make in India initiative. We at Clairco are into air quality monitoring and I’m pretty sure that monitoring as an industry has grown, but I won’t be able to comment on how much Make in India was part of it.

Overall, Make in India has helped HVAC manufacturers and we also need to understand that this is an ongoing process and it has to increase. With the US-China trade war going on, China’s exports will go down and economies such as India would have to take full benefit of that. Now is the right time for Indian HVAC market to grow incredibly fast. I hope Make in India continues to give better credit, reduce taxation, and help industries including start-ups like us to improve on operational profit.

Digital India for HVAC industry?
I really don’t think Digital India has done a lot for the HVAC industry. I strongly feel that the Indian HVAC industry is fairly behind in terms of newer technologies to take on international markets. I’m not sure if Digital India has been able to do what was promised.

Realigning the priorities of Make in India and Digital India for HVAC?
In Make in India we need to have special SEZs or manufacturing areas where we could reap tax benefits. If you look at China, they were able to grow because of incredible tax reforms, which were able to help them reduce the overall tax burden the companies had.

Similarly, with Digital India, there should be efforts made for research and development. At Clairco, we’re very focused on R&D and technology. But, we are not able to get any sort of grants from the government to actually work on the technology or software side. For example, if you’re generating so much air quality data, we need to hire expensive engineers to make algorithms that can predict the air quality. But, for a start up like us, it gets difficult. Hence, government grants would help us improve the technology and the implementation faster. I really believe that we need to focus on two things; reduce tax burden and increase fund for R&D.

India to develop its own certification facility for air pollution monitoring equipment.
Certification facility should’ve been there long back, but it’s better late than never. Lot of newer companies or start-ups like us are taking up air quality monitoring, where monitors and sensors are imported from the West. These sensors are calibrated for their environmental situations and locations. These really need to have certification agencies and the cost of certification should be very low. For example, to get a certification done in EU, it will set you back by `20-25 lakhs, which is really steep for a start-up. So the certification should be introduced and it would be a very welcome change.

I hope Make in India continues to give better credit, reduce taxation,and help industries including start-ups to improve on operational profit
Aayush Jha, Founder & CEO, Clairco