Daikin is keen on partnerships as localisation and R32 gas production gather pace in India

Kanwal Jeet Jawa, Chairman and Managing Director, Daikin India, at the launch of an experience centre in Chennai
| Photo Credit:
BIJOY GHOSH

With India’s air conditioning industry advancing towards greater localisation and eco-friendly refrigerants, Japanese air-conditioning major Daikin is actively exploring partnerships with emerging domestic manufacturers for the production of R32 refrigerant gas, a critical component in energy-efficient cooling systems.

Commenting on the growing number of Indian players entering the R32 segment, Kanwal Jeet Jawa, Chairman and Managing Director of the ₹12,500 crore-plus Daikin Air-Conditioning India Pvt Ltd, described the development as highly encouraging. “We are fully supportive of these initiatives and have even offered free patents to interested companies. We’re already in discussions with some of them,” he told businessline at the launch of Daikin’s new experience centre in Chennai.

“Refrigerants, compressors, and alternative materials represent major growth areas, and collaboration is essential,” he said.

Until about 2020, domestic manufacturing accounted for only 25 per cent of components in room AC products, with the rest being imported. Today, that figure has risen to nearly 60–65 per cent with the industry aiming to achieve 75 per cent localisation by 2025— a target set under the leadership of RAMA (Refrigeration and Air Conditioning Manufacturers Association). Jawa noted that the industry is proactively working to meet this ambitious target despite delays in some critical components due to ongoing challenges with raw material availability.

10 crore outdated ACs

Addressing the need for more energy-efficient solutions, Jawa revealed that Daikin and other industry players are working with the Indian government to introduce replacement schemes aimed at phasing out outdated AC units. One such proposal, currently under review by the Power Ministry, would offer incentives to consumers who upgrade to modern, energy-efficient systems. “Replacing just 10 per cent of the estimated 10 crore old AC units in India could have a transformative impact on national energy consumption,” he said.

The proposed scheme aligns with India’s e-waste policy, which encourages replacing appliances after 10 years of use. According to Jawa, this initiative could substantially reduce energy bills and environmental impact.

Daikin currently operates three manufacturing plants in India, with a combined annual capacity of 3 million room air conditioners. The company plans to expand this to 5 million units by 2030.

Exports

Looking ahead, Daikin sees strong potential for exports. India’s recent leadership role in managing diplomatic and trade relations with 54 African nations presents a major opportunity. “We’ve already established a presence in 30 of those countries,” Jawa said. “From India, we’ve begun exporting VRVs and chillers. The export of room ACs is set to grow significantly.”

The company has already set up its first room air conditioner assembly unit in Nigeria and has begun exporting units from its Sri City facility in Andhra Pradesh.

Published on May 19, 2025