The Indian government has set up a special committee to make Quality Control Orders (QCOs) simpler and less strict. This will help over 6 crore micro, small, and medium enterprises (MSMEs) import affordable raw materials without long delays or high costs. The move comes after MSMEs complained that current rules block cheap imports and raise their production expenses. The committee, led by former Cabinet Secretary Rajiv Gauba, will give monthly suggestions to cut red tape while keeping product safety intact.
What are Quality Control Orders (QCOs)?
Quality Control Orders are rules set by the government to ensure products meet safety and quality standards, making it mandatory for items to get BIS certification before sale or import.
Historical Background:
QCOs come from the Bureau of Indian Standards Act of 2016, which turned optional standards into must-follow ones after 2014 to support Make in India and stop low-quality imports from hurting local makers.
Current Scope and Coverage:
They now cover 770 products in areas like steel, toys, electronics, and chemicals, with 84 added in the last three years by ministries such as Steel and Consumer Affairs to protect buyers from unsafe goods like faulty helmets or water heaters.
Role in Economy:
QCOs help build trust in Indian products for exports but add extra steps that slow down small businesses, raising costs by 15-20% for firms that depend on global parts for making things like auto parts or fabrics.
Why do MSMEs face challenges with QCOs and imports?
MSMEs find QCOs tough because the rules cost a lot and take too much time, especially when they need to import basic materials that India does not make enough of locally.
MSME Vulnerabilities:
These 6 crore small firms handle 45% of India's exports but pay high fees for tests and audits, lose deals from six-month waits, and see business drop by 10-15% in fields like plastics and garments.
Import-Specific Hurdles:
Under the Foreign Manufacturers Certification Scheme, QCOs block small overseas sellers, forcing MSMEs to buy costly Indian options; for instance, new steel rules held up Rs 500 crore in shipments this year, affecting small workshops that import 40% of their steel.
Industry Feedback:
Groups like CII say surprise QCO changes cause 25% price jumps, so they ask for warnings before new rules and breaks for test imports to help small firms try new ideas without big risks.
What is the High-Level Committee and its key proposals?
The High-Level Committee on Non-Financial Regulatory Reforms is a team set up to check and fix business rules like QCOs, making them easier without losing safety for everyday users.
Committee Composition and Mandate:
Led by Rajiv Gauba, who helped with past business ease changes, it has officials from trade and consumer departments plus business voices; started on August 19, 2025, it looks at rules monthly to fit India's growth plans by 2047.
Major Recommendations:
It plans to group BIS checks into two types, move from checking factories to watching markets, and let licenses run without short renewals to drop fees by half or more for small players.
Expected Outcomes:
This could make approvals take just 1-2 months, save each MSME Rs 5,000-20,000 a year per item, and match easy rules in places like the EU, adding 1-2% extra growth for these vital small businesses.
How does BIS certification work under QCOs?
BIS certification is the official okay needed for QCO-covered goods, where products get tested and checked to match Indian safety levels, but the steps can trap small firms in paperwork.
Certification Process:
It begins with sending details to BIS, then testing samples, visiting the maker's site, and getting a 1-2 year license; strict Scheme-I is for risky items like pipes, while easier Scheme-II lets electronics firms declare their own checks.
Challenges and Data:
With BIS handling everything, waits pile up for 30-40% of requests; in 2025-26, four more QCOs hit 50 products, causing 20% of small import tries to fail over small rule slips.
Reform Suggestions:
The group wants outside testers, online self-checks for good firms, and deals with 15 countries to accept their test results, cutting import hassles by 60% for quicker supply chains.
What are the broader implications for India's economy and MSMEs?
Simplifying QCOs can free up small businesses to grow faster with lower costs, but it needs care to stop fake goods from reaching shops and harming trust in the market.
Economic Boost:
MSMEs fuel 30% of GDP and half of jobs; easier rules could add Rs 2-3 lakh crore to their work by 2030 through cheap parts, pushing self-made growth without leaning too much on outside supplies.
Risks and Safeguards:
Some fear fewer checks might let bad copies spread, which already take 5-7% of sales; the plan calls for better shop watches and checks before adding rules to keep things safe.
Global Context:
This fits world trade rules against hidden blocks; nations like Vietnam cut similar red tape to grow small firms by 15% each year, giving India tips to join big supply lines for clothes and electric cars.
© 2025 Gaining Sun. All rights reserved.