On quality control orders, a welcome regulatory reset, Pg10

Key Highlights:

• India has withdrawn Quality Control Orders (QCOs) on a wide range of industrial raw materials, marking a significant regulatory reset.
• The move acknowledges industry concerns that mandatory certification is unsuitable for low-risk, widely traded inputs.
• NITI Aayog's report highlighted the growth of QCOs from 70 to over 790, encompassing even low-risk materials.
• The withdrawal, notified on November 13, removes compulsory BIS certification for 14 chemicals and petrochemicals products and six mines ministry products.

Detailed Insights:

• The previous approach of mandatory certification for raw materials led to fewer sourcing options and higher input prices for Indian manufacturers.
• MSMEs particularly faced challenges due to paperwork, delays, and limited BIS testing capacity, affecting export-oriented sectors.
• Major manufacturing economies like the EU and US primarily apply conformity requirements to finished goods, managing intermediate inputs through voluntary standards.
• The rollback aligns India's standards regime with global practices, regulating high-stakes products while allowing market mechanisms for bulk raw materials.
• This decision provides breathing room for industries targeted under the PLI schemes, such as electronics, specialty steel, and technical textiles.
• A risk-based framework will enhance the credibility of quality enforcement, focusing on areas with consumer or public-safety implications.
• The government should invest in expanding testing capacity, speeding up certification timelines, and conducting impact assessments.

Key Concepts Involved:

• Quality Control Orders (QCOs): Mandatory certifications intended to ensure product quality and safety standards.
• BIS Certification: A certification scheme by the Bureau of Indian Standards ensuring products meet specified standards.
• PLI Schemes: Production-Linked Incentive schemes aimed at boosting domestic manufacturing and exports.