Quality Control Orders: How They Are Reshaping India’s Import Bills and Manufacturing Sector?

India’s rapid expansion in manufacturing, coupled with its ambition to become a global supply-chain hub, has brought renewed focus on the quality of products entering and leaving the domestic market. One of the most significant policy tools driving this shift is the government’s increasing use of Quality Control Orders (QCOs). These legally binding standards, issued under the Bureau of Indian Standards (BIS) Act, require that certain goods—whether imported or domestically produced—must conform to specific Indian Standards before they can be sold in the country.

In recent years, QCOs have expanded from a relatively small set of products to hundreds of items across sectors such as steel, chemicals, toys, textiles, electronics, plastics, and more. As their coverage grows, so does their impact on India’s import bill, manufacturing capabilities, and the value consumers receive from products sold in the country.

1. QCOs and Their Impact on India's Import Bills

a. Reduction in Low-Quality Imports

The primary purpose of QCOs is to curb the influx of substandard and unsafe products. By requiring BIS certification, QCOs create a quality threshold that many low-cost, low-grade imports cannot meet. As a result, the volume of such imports has declined, especially in sectors like toys, low-grade steel, cheap electronics, and certain chemicals.

This directly lowers the import of inferior products, ensuring that only goods meeting minimum standards enter the Indian market.

b. Decrease in Import Volumes of Inputs and Raw Materials

However, QCOs do not only cover finished products. Many orders also apply to raw materials and intermediate goods—items that are essential industrial inputs. This has led to a noticeable decline in the import of certain raw materials, as foreign suppliers often find BIS certification cost-intensive or cumbersome.

For Indian industries that depend heavily on imported inputs, this can create supply chain disruptions. Importers also face increased compliance costs, laboratory testing delays, and certification bottlenecks. The overall effect is a reduction in import volumes but a rise in import-related expenses, often increasing the landed cost of materials.

c. Increased Costs for Domestic Manufacturers

Since QCOs tighten access to imported raw materials, domestic producers may face higher procurement costs. In certain sectors, Indian manufacturers have reported paying significantly more for raw materials due to fewer suppliers being eligible to comply with the Indian standard.

Thus, while QCOs help reduce low-quality imports, they may also inadvertently raise the cost of high-quality inputs needed by Indian industry.

2. Transforming India's Manufacturing Sector

a. Creating a Level Playing Field

QCOs prevent the Indian market from being flooded with cheaper but inferior imports, helping domestic manufacturers compete fairly. This is particularly beneficial in sectors where Indian producers historically struggled against low-priced foreign competition.

By ensuring uniform quality standards, the government aims to create an environment where Indian industry can grow without being undercut by substandard imports.

b. Encouraging Investment in Quality and Compliance

Mandatory standards force manufacturers—both foreign and domestic—to invest in quality systems, testing, plant improvements, and certifications. This leads to a gradual technological upgradation across the sector.

For larger companies, this shift aligns well with global best practices and enhances their export readiness. However, for MSMEs, the compliance burden can be heavy. Many struggle with certification costs, insufficient testing infrastructure, procedural delays, and the complexity of BIS norms.

c. Boost to “Make in India,” but with Caveats

In theory, restricting imports of inferior goods should support domestic production. Many large Indian manufacturers do benefit as tariff-like protection emerges through non-tariff quality measures.

But when QCOs cover raw materials essential to Indian manufacturing, they can do the opposite—raising production costs, reducing competitiveness, and straining MSMEs. This has led to growing calls for a more balanced approach, differentiating between consumer-end products and industrial inputs.

3. Supply Chain Adjustments and Market Effects

a. Certification Delays and Compliance Pressure

India currently faces a shortage of BIS-accredited testing labs for several categories. This leads to delays in certification for both domestic manufacturers and foreign exporters. Such delays translate into longer lead times, affecting production scheduling and inventory management.

b. Market Consolidation

Large companies, with higher capacity to comply with QCO norms, often gain market share as smaller firms and smaller importers find compliance costly or difficult. This leads to consolidation within industries, which can be positive for quality but also reduces competition.

c. Export Concerns

When domestic manufacturers rely on imported raw materials, stringent QCOs can raise their export prices. This affects competitiveness in global markets, especially in labour-intensive sectors such as textiles, footwear, and light engineering.

4. Are QCOs Delivering “Value for Price” to Consumers?

a. Improved Product Quality

For consumer-facing goods, QCOs have been highly effective. Toys, electrical appliances, electronic devices, and steel products now meet better safety and quality benchmarks. This ensures consumers get more durable, reliable, and safe products—delivering better value for the price paid.

b. Increased Costs Passed to Consumers

Where QCOs affect the cost structure of domestic production—particularly due to expensive raw materials—these costs are often passed on to consumers. This means improved quality, but at higher prices.

c. Need for Sector-Specific Calibration

The challenge is balancing quality with affordability. Applying QCOs indiscriminately across both finished goods and raw materials creates inefficiencies. A more nuanced approach—tighter standards for consumer goods, flexible norms for industrial inputs—would achieve quality benchmarks without inflating prices.

5. Government Response: Rollbacks and Refinements

Recognizing the economic impact, the government has begun revisiting certain QCOs, especially those that disrupt industrial inputs. Several QCOs in plastics, chemicals, and steel have been relaxed or withdrawn to ease manufacturing bottlenecks.

This signals a shift toward a more calibrated, risk-based quality regulatory regime—one that protects consumers without hampering industrial productivity.

Conclusion

Quality Control Orders are reshaping India’s economic landscape in significant ways. They are improving the quality of goods available to Indian consumers and strengthening domestic industry against substandard imports. However, the impact on the import bill and the manufacturing sector is mixed. While they reduce low-quality imports and encourage higher standards, they can also raise input costs, complicate compliance, and burden MSMEs.

The key lies in balanced implementation: focusing QCOs on safety-critical and consumer-end products while ensuring that industrial inputs remain accessible and affordable. With continuous refinement, QCOs can evolve from blunt trade instruments into sophisticated regulatory tools that strengthen India’s manufacturing ecosystem and ensure genuine value for price in both imported and locally made goods.