India Rolls Back Quality Rules for 20+ Products! Big Relief for Industry - Steel Next?

Author

Satyam Jha | Whalesbook News Team

Detailed Coverage:

The Indian government has recently withdrawn Quality Control Orders (QCOs) for more than 20 key industrial products. This action is a significant step towards enhancing industrial competitiveness by easing the regulatory burden.

QCOs, mandated by the Bureau of Indian Standards (BIS), require products to meet specific quality standards before they can be sold in India. However, a high-level committee highlighted that the rapid increase in QCOs, from under 70 in 2016 to nearly 790, has led to increased costs, supply shortages, and lengthy certification delays, disproportionately affecting Micro, Small and Medium Enterprises (MSMEs).

The committee recommended rolling back most QCOs on raw materials and intermediates, stating that they often add costs without improving safety. The recent withdrawal includes items across textiles (e.g., Polyester, PTA, MEG), plastics (e.g., PP, PE, PVC, ABS, PC), and base metals (e.g., Aluminium, Lead, Nickel, Tin).

Furthermore, the committee urged the government to address the Steel Import Monitoring System (SIMS) and the steel ministry's No-Objection Certificate (NOC) rules, which have been criticized for slowing down imports and raising prices. Recommendations include suspending QCOs for most steel grades, except for construction and pressure-vessel applications.

What needs to be done now includes implementing the committee's suggestions for steel and other remaining products, setting clear BIS timelines for approvals, aligning QCOs with global norms, and conducting regulatory impact assessments before issuing new orders.

Impact: This rollback is expected to positively impact industries by reducing compliance burdens and potentially lowering input costs. It could lead to improved supply chain efficiency and increased manufacturing output. However, the effectiveness will depend on maintaining quality standards through other mechanisms. Rating: 7/10

Difficult Terms: MSMEs: Micro, Small and Medium Enterprises. These are businesses categorized based on their investment in plant and machinery and annual turnover, playing a crucial role in India's economy. BIS: Bureau of Indian Standards. The national standard body of India responsible for standardization, marking and quality certification of goods. QCO: Quality Control Order. A government regulation mandating that certain products must adhere to specific quality standards before being allowed for sale or import.