Centre to Form Framework to Ease Quality Control Orders for High-Tech Sector

Commerce and Industry Minister Piyush Goyal has announced that the central government will develop a framework to ease or waive mandatory Quality Control Orders for high-technology industries, following concerns raised by Japanese companies operating in India.

Speaking during his recent visit to Tokyo, Goyal said the new mechanism aims to address difficulties related to mandatory Bureau of Indian Standards certification. A survey conducted by the Japan External Trade Organization for fiscal 2025 revealed that the operations of 71.9% of Japanese manufacturers in India were affected or expected to be affected by BIS certification requirements. The impact was notably higher in specific sectors, reaching 92.3% among general-machinery firms and 76.8% among transportation-equipment manufacturers.

Japanese companies reported that compliance under the current system requires extensive product testing, detailed documentation, and foreign factory inspections conducted by BIS officials. Overseas manufacturers must bear these expenses even when their products already comply with Japanese or international quality standards.

These regulatory hurdles have created supply chain disruptions across multiple manufacturing sectors. Some Japanese businesses were forced to switch suppliers after overseas vendors refused to seek India-specific certification for low-volume orders. In other cases, companies struggled to find domestic substitutes meeting their technical specifications.

According to the JETRO survey, 42.7% of affected businesses experienced delayed deliveries or suspended sales. Several companies also faced obstacles when seeking No Objection Certificates for imported components that had previously entered the country without full certification.

Industry think tank Global Trade Research Initiative noted that while the proposed relief for high-tech industries is a positive step, India requires a wider review of the entire QCO regime. GTRI stated that the current rules raise costs for manufacturers, disrupt supply chains, and discourage investment.

The research body pointed out that exempting high-tech machinery while continuing QCO enforcement on items such as footwear and furniture places heavy compliance costs on micro, small, and medium enterprises. It recommended that India consider a risk-based model similar to the European Union, where standards are published, manufacturers declare conformity to use certification marks without prior government registration, and regulators enforce compliance through market surveillance and penalties.

GTRI also called on the government to eliminate double certification requirements, noting that QCOs are currently applied separately to both raw material inputs and finished manufactured products.