MSMEs in metal packaging ‘directionless’ due to govt’s silence over implementation of BIS order: MCMA

A similar notification was issued to impose mandatory BIS standards in 2008, 2015, and 2017 but was withdrawn after considering representation from trade and industry and keeping in mind practical issues in implementation. Image: Reuters

Ease of Doing Business for MSMEs: Metal Container Manufacturers Association of India (MCMA), which represents MSMEs in metal container manufacturing, on Thursday expressed concern over the Ministry of Steel’s “silence” on the Quality Control Order (QCO) as the extension of its implementation ended on July 17, 2021. The association said, “The (Rs) 10,000 crore (MSME dominated) metal packaging industry of India, which is already facing dark times, is now in a major dilemma and stands directionless as the Ministry of Steel remains silent…Production is on hold (as) there is a scarcity of raw material that is acting as a major hindrance to bridge the demand-supply gap.” The association had recently urged the government to put on hold its implementation. 

“QCO was deferred till July 17. We had requested the government to extend it till March next year due to the Covid scenario. Also, foreign producers, who had applied for BIS registration, were to get their plants physically approved by BIS officials visiting them. This couldn’t happen due to the current situation. Now in such a case where Indian players don’t have full capacity to operate and they cannot import raw material then from where will the industry get the material to produce goods. While the industry is facing survival challenges, the government is looking to impose QCO,” Sanjay Bhatia, President, MCMA told Financial Express Online.

The government had issued the QCO in July last year that pushed manufacturers for BIS certification for the major input material required such as like tinplate, tin-free steel, and had also imposed restrictions on various steel products like easy-open ends, peel off ends, etc. This proved to be a significant cost challenge for MSMEs facing working capital crunch due to Covid disruption. Also, according to the association, it was virtually impossible to force the international suppliers for BIS certifications as the procedure of BIS registration is highly cumbersome. 

“There is a shortage in domestic production therefore the industry cannot import. Steel and Steel Products QCO will restrict the supply of input materials to crucial industries such as tin can making industry. In fact, any move to ban imports of such material will result in production shortage, significant loss of job opportunities especially in the MSME sector as well as lead to increase in defaults to banks,” the association added. A similar notification was issued to impose mandatory BIS standards in 2008, 2015, and 2017. However, after considering representation from trade and industry and keeping in mind practical issues in implementation, the said notifications were withdrawn.