Think Tank GTRI Urges Top-Level Review of Quality Control Orders to Protect MSMEs and Exports

Economic think tank Global Trade Research Initiative (GTRI) has called for a top-level review of India's Quality Control Orders (QCOs). The think tank stated that the current norms must be evaluated to ensure they protect consumers without functioning as import restrictions or licensing barriers.

Under current rules, QCOs make Bureau of Indian Standards (BIS) certification compulsory for designated products. Goods covered by these orders must meet Indian Standards and acquire the BIS mark before they can be legally sold or imported into the country.

According to GTRI, mandatory quality certification under these orders raises operational costs, places a heavy burden on micro, small, and medium enterprises (MSMEs), and drives up prices for end consumers. Founder Ajay Srivastava noted that the system risks weakening MSMEs and discouraging the manufacturing investments targeted by the 'Make in India' initiative.

The think tank also highlighted potential international implications. If other nations implement similar mandatory orders, Indian exporters could face the burden of obtaining separate country-specific certifications despite already meeting recognized international standards. This could involve recurring expenses such as licensing, renewal, and testing fees, alongside travel and per-diem costs for visiting inspecting officers, leading to delayed shipments and higher export costs.

The call for review follows recent developments concerning foreign investors. Commerce and Industry Minister Piyush Goyal stated in Tokyo that India would develop a framework to ease or waive mandatory quality certifications for high-technology industries. This announcement was made in response to concerns raised by Japanese companies regarding the QCO system.

Data cited by GTRI from a Japan External Trade Organization (JETRO) survey for fiscal 2025 indicated that 71.9 percent of Japanese manufacturers operating in India reported that BIS certification has affected, or is expected to affect, their business operations.

While welcoming the proposed relief for high-technology industries, GTRI emphasized the need for a broader evaluation of the entire QCO regime to prevent supply chain disruptions and support overall manufacturing growth in India.

"Regulatory compliance is critical for consumer safety, but it must be balanced carefully with operational ease, especially for MSMEs and manufacturers who form the backbone of our economy. When certification processes become overly complex or costly, they risk slowing down supply chains and impacting export competitiveness. A structured review of quality control orders, as suggested, can help streamline compliance while continuing to foster an investor-friendly environment for domestic and international businesses alike." — Dr. Shishir Gupta, Founder & CEO, StartupLanes