Since India relies heavily on specialised imported fasteners for critical applications in industries, such as automobiles, aerospace, electronics, and defence, their sudden unavailability will jeopardise production.
India faces the risk of widespread shutdowns of small manufacturing firms and job losses, as import of steel fasteners, including nuts, bolts, screws, may come to a halt due to the implementation of quality control orders (QCOs) from next week, a Delhi-based think-tank said on Wednesday.
Steel fasteners are crucial for stability, durability, and safety across various industrial sectors, such as automobile, construction, electronics, machinery and equipment manufacturing, railways, military, among others.
According to the Global Trade Research Initiative (GTRI), from March 20, import of steel fasteners will stop as no foreign manufacturers have been approved under the Bureau of Indian Standards (BIS) certification process.
This will create uncertainty and supply chain bottlenecks.
'The cumbersome BIS approval process discourages foreign manufacturers from registering due to complex procedures and low trade volumes, leading to critical shortages,' GTRI noted.
'Additionally, customs clearance delays caused by confusion over HS Code classifications will add to costs and inefficiencies, impacting businesses already struggling with supply chain disruptions,' the GTRI report said, adding that the QCO risks widespread shutdowns of small manufacturing firms that may find it difficult to obtain certification, leading to job losses and industrial stagnation.
Since India relies heavily on specialised imported fasteners for critical applications in industries, such as automobiles, aerospace, electronics, and defence, their sudden unavailability will jeopardise production.
QCOs are government orders to ensure the quality of products, protection of human, animal, and plant health, and prevention of deceptive practices.
They are notified by government departments in consultation with the BIS and are compulsory in nature for a foreign as well as a local manufacturer.
This means that manufacturers and importers need to adhere to certain standards and obtain BIS certification to ensure compliance with standards.
In this case, the Department for Promotion of Industry and Internal Trade (DPIIT) had issued the QCO in September last and will be implemented in a phased manner.
To begin with, from March 20, it will be implemented for all imports and large firms.
For small and micro firms, the order will come into effect from June 20 and September 20, respectively.
India produces standard fasteners, but relies on imports for high-end fasteners, which will now be unavailable.
During 2024, India's global imports of steel fasteners amounted to $1.1 billion, according to data compiled by GTRI.
Of the total imports of such products, the lion's share came in from China at $306 million, followed by Japan at $127 million, South Korea at $111 million, Germany at $107 million, United States at $104 million, Thailand at $78 million and Singapore at $63 million.
GTRI suggested that the government should reconsider the QCO and instead adopt a more pragmatic approach, such as mutual recognition of international certifications or phased regulatory adjustments, to balance quality control with industry needs.
Feature Presentation: Aslam Hunani/Rediff.com
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