A new regulation by India’s Ministry of Steel could severely disrupt supply chains and impose heavy compliance costs on micro, small, and medium enterprises (MSMEs), according to the Global Trade Research Initiative (GTRI), as reported by local media.
Issued on June 13, the rule mandates that not only finished and semi-finished steel products but also the raw materials used in their manufacture must meet Indian Standards and be registered on the Steel Import Monitoring System (SIMS). The regulation applies to all items under India’s Quality Control Orders (QCOs).
Previously, foreign exporters only needed certification from the Bureau of Indian Standards (BIS) for finished products. Now, upstream materials like billets, slabs, and hot-rolled coils must also be BIS-certified.
GTRI warned that the abrupt change, enforced with just three days’ notice and no stakeholder consultation, has triggered panic among MSMEs dependent on imported semi-finished steel. Many fear heavy losses and potential plant closures, especially as some have already paid advances for shipments scheduled between June and August, which now risk being deemed non-compliant.
The think tank also questioned the rationale behind the rule, particularly when BIS officials already inspect and certify finished products at foreign facilities. It noted that BIS certification for upstream suppliers can take six to nine months and urged the government to reconsider or delay implementation to avoid widespread economic disruption.