The Government of India recently revoked 22 Quality Control Orders (QCOs) on chemicals and polymers, key inputs for multiple industries, including textiles. Of these, seven were directly linked to the textile sector and a few to automobiles. This move comes against the backdrop of an internal high-level NITI Aayog committee report, which observed that QCOs, disproportionately targeted at raw materials and intermediaries, have contributed to supply shortages and inflated domestic prices. While the rollback is a commendable step in overhauling India’s standards framework, especially in an era shaped by Trump-era tariffs and rising global protectionism, it also calls for a deeper reassessment of how India has used QCOs as a defensive trade instrument. India should seize this moment to shift towards a voluntary, globally credible hallmarking system.
QCOs are technical regulations issued by ministries or departments under the Bureau of Indian Standards (BIS) Act, 1986. In principle, they are meant for products whose quality buyers cannot easily determine, or where a clear public health, safety, or environmental justification exists. Although domestic producers and importers are subject to the same standards, QCOs often function as non-tariff barriers. This further acts as an import barrier when there is a limited state capacity, further delaying the approvals for foreign imports, particularly when BIS is both the issuer and the enforcer. This challenge has grown alongside the rapid expansion of QCOs from 2016 to 2025, resulting in an eightfold increase in the number of QCOs, covering nearly 700 products today. This coincides with India’s Make in India ambitions and the push to shield domestic manufacturing from foreign competition. But if the intention was to strengthen domestic production, the outcome appears to be the opposite, constraining India’s export competitiveness.
The NITI Aayog committee highlighted that QCO implementation has led to market concentration by disadvantaging MSMEs and favouring larger firms that can absorb higher compliance costs and then raise prices above global levels. Most QCOs also cover raw materials and intermediate goods, including many that pose no direct safety or environmental risks. This has increased input and compliance costs, often requiring multiple approvals for a single input, and pushed domestic prices upward. Polyester fibre and yarn, for instance, are priced 15–25 per cent above global benchmarks, dampening export prospects. The top sectors impacted by QCOs, such as metals, textiles, and chemicals, are also the sectors in which India has significant export potential. This is a costly affair for India, when it’s already facing higher U.S. tariffs relative to competitors, further eroding its export edge.
India’s constrained state capacity compounds these issues, further adding to manufacturers’ costs if certificate backlogs emerge, potentially leading to market concentration or rent-seeking and raising entry costs for newer players. Inevitably, this leads to higher costs for consumers and fewer export and growth opportunities, creating the exact opposite effect of what it was supposed to do.
Against this backdrop, the recent withdrawal of several QCOs is a step in the right direction, especially when India seeks to bolster export performance to sustain growth. But this must be accompanied by a broader rethink of the QCO regime itself. At this crucial geoeconomic moment, India’s strategic trade framework should shift towards voluntary standards, much like most advanced economies, and align more closely with international benchmarks. Such alignment would reduce the burden on Indian exporters who must often duplicate testing and certification abroad despite adhering to BIS standards. From overregulation, where it’s perceived as a non-tariff barrier rather than a genuine consumer protection measure by its trading partners, India must move towards a hallmarking system that is acceptable and credible in the foreign markets.