The rapid expansion of Quality Control Orders (QCOs), with their scope going beyond final goods, has raised concerns. For instance, earlier this year, the Confederation of Indian Textile Industry had said that QCOs on inputs were making it difficult to source raw materials, impacting competitiveness. As per a report in this paper, a recent NITI Aayog report has noted that QCOs have affected the competitiveness of export and employment-oriented sectors. The sheer expanse of these orders — as of March 2025, 187 QCOs, which cover 769 products, had been notified for certification — meant that the effects were being felt across several sectors, especially in areas such as textiles, machinery and electronics and metals. That the government has now moved to address these issues is a welcome step.
Last week, the Ministry of Chemicals and Fertilisers revoked QCOs on 14 items consisting of chemical intermediaries and others that play a critical role in the textile value chain. The Ministry of Mines followed by revoking seven QCOs on minerals such as nickel, copper and aluminium. QCOs are meant to ensure quality products, but they also increase the compliance and regulatory burden, raise input costs, and tend to act as trade barriers. In instances where there are few domestic alternatives, the situation becomes more challenging. They impact smaller firms disproportionately, as the larger firms, better equipped to deal with the bureaucratic labyrinth, benefit. Noting that enforcement of standards on raw materials and capital goods had led to “operational difficulties” for firms, the NITI Aayog study had recommended revocation, suspension and deferment of orders in other categories.
A study from the Centre for Social and Economic Progress shows that while QCOs lead to a drop in imports, no long-term export gains have been observed. This quality control regime, which effectively raises trade barriers, is at odds with the objective of seeking deeper integration with global supply chains. India’s push to lower tariff barriers and sign more free trade agreements, seeking greater engagement with the world, should be accompanied by a dismantling of non-tariff barriers as well.
