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UJALA - A revolutionary government scheme, that is leading the Indian LED lighting market on a sheer growth path: Bonafide Research

In 2015, with the target of replacing 770 million traditional lamps by the year 2019 Indian government already laid the foundation for tremendous growth of LED lighting market in India. With nearly 20 crore units sold under UJALA scheme in just 2 years, the overall LED lighting market has got a major breakthrough in terms of growth. Government is procuring all these units in bulk from the private players and is providing at a lower rate to the citizens. Hence, this scheme has emerged as a win-win solution for the manufacturers as well as the consumers.

In the initial stage, when the LED lights were introduced in the market it was very troublesome for the technology to get a space in the lighting industry that was highly penetrated by the incandescent and CFL lights. To compete with these technologies which were available at a very lower price seemed to very difficult as the major proportion of Indian population comprises of the middle class income group people. Moreover with the lower demand, manufacturers were also not able to take the advantage of economies of scales and pull down the per unit price of LED lights. The only thing they were in need was indeed a bulk order which allows them to do a large scale production and pull down the prices. UJALA and SLNP schemes by central government became the reason for this huge production, thus lowering down the prices and setting the LED lighting market on a growth path.

According to recently published report of Bonafide Research, "India LED Lighting Market Outlook, 2022", the LED lighting market which could not constitute of even 10% of the total lighting market till 2011, has grown above 20% in the current year 2015. The major development of the market took place in the last two years of 2015 and 2016. Sales of LED lights has grown more than 10x times in the past two years, making the technology as one of the fastest growing in India. It is very obvious that the people do not replace a bulb unless it stops working, but the problem which was arising till 2014 was Indian consumers replacing the old incandescent of CFL bulbs with the same technology and not the LED lights as they were costlier. It was very necessary to make people tend towards using the LED lights at the time of replacement. When the Modi government introduced UJALA scheme, people literally starting running for getting the maximum units of 10 LED lights fixed by the government. This led the foundation for repurchase of LED lights and creating a strong market scope for the same.

Moreover, the exhaustive promotional activities carried out by the LED manufacturing companies also played a major role in convincing people to buy LED lights. Players tried hard to make people aware about the long term cost effectiveness of LED lights as well as their environmental benefits. Another major thing that happened was a steep fall in the market prices of LED lights when the government started providing these lights at a very cheaper rate. At present while the UJALA bulb is available at Rs. 70, the market rate is somewhere between Rs. 110-130 which is not a huge difference. With the declining prices of the LED lights, sales of private players have also increased significantly. After achieving the target of 770 million units, the government will move out from the market making the whole field open for the private players. The efforts which have been made in the current years have given spontaneous results and it will carry on providing its fruits to the private players in the coming years as well.

Major companies operating in the LED lighting market of India are Philips Lighting India Limited, Havells India Limited, Surya Roshni Limited, Bajaj Electricals Limited, Syska LED Lights Private Limited, Crompton Greaves Consumer Electricals Limited, Osram Lighting Private Limited, Wipro Enterprises Private Limited, Eveready Industries India Limited and Moser Baer India Limited.


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