Mumbai: Japanese major Panasonic is upping its investment in India despite challenges the consumer electronics and durables market is facing in the wake of demonetisation.
In a conversation with Business Standard, Tetsuro Homma, senior managing director, Panasonic Corporation, said the pain triggered by demonetisation was short-term and would not last more than a couple of quarters.
“We remain committed to the Indian market despite the disruption triggered by demonetisation. From long-term point of view, India still remains an attractive bet for us,” said Homma, who is also worldwide president of Panasonic’s appliance company, responsible for a $25 billion (or Rs 1.7 lakh crore) business.
The maker of the Viera brand of televisions and Econavi range of air conditioners will set up a new manufacturing facility for refrigerators in Jhajjar, Haryana, at an investment of Rs 115 crore. The plant will be operational by November 2017, with annual production capacity of 0.5 million units, Homma said.
This investment figure along with previous amounts will take Panasonic’s total investment into India in the last few years to over Rs 300 crore, company executives said. “While local manufacturing of most of our products including televisions, air conditioners, washing machines and mobile phones had begun in India, refrigerators was a gap that needed to be filled,’says Manish Sharma, president and CEO, Panasonic India & South Asia. “That process has been set into motion now,” Sharma said.
The move to manufacture and assemble Panasonic products in India also comes at a time when the Japanese major is looking to shift its manufacturing and research and development (R&D) base here from China. This comes as China loses its advantage as a cost-effective base, market sources said, compelling consumer electronic majors to look at alternatives such as India.
Homma says that India will act as a regional hub not only for the south and west Asian markets, but also for Africa. The firm will also set up its first offshore advanced R&D unit in Bengaluru next year as it looks to widen its footprint in the country, he added. The advanced R&D unit will begin with 60 people, which is expected to be ramped up quickly over time. Exports from India into South & West Asia and Africa are also expected to increase over time, Homma added.
source: India in Businesss 07-DEC-2016