India Eases BIS Rules for High-Tech Manufacturing

Commerce and Industry Minister Piyush Goyal has proposed easing Bureau of Indian Standards (BIS) certification requirements for high-tech companies. This initiative seeks to address an unintended obstacle within India’s industrial policy that has deterred global firms from establishing advanced manufacturing facilities.

India’s government initially implemented stricter quality and certification standards, especially after 2020, to bolster local industry and reduce reliance on imports. The primary goal was to ensure product quality and safety while providing a competitive advantage to domestic manufacturers against imported goods.

Unintended Consequences for Advanced Manufacturing

However, this policy has become counterproductive when applied to specialized machinery, components, and equipment necessary for setting up factories in India. This differs from its intended application to final products competing in the domestic market.

India’s ambition to grow in sophisticated manufacturing areas like semiconductors, advanced electronics, precision manufacturing, and Artificial Intelligence (AI) infrastructure is directly impacted. Global companies in these sectors rely on deeply integrated supply chains, often needing highly specialized equipment.

Subjecting such essential equipment to certification processes designed for consumer products can significantly increase costs and cause investment delays. Ultimately, this undermines the very manufacturing growth the policy aims to foster.

Towards a Nuanced Regulatory Framework

Minister Goyal’s comments necessitate a re-evaluation of whether India’s standards regime has become an overly broad industrial policy instrument. The article advocates for a more nuanced framework that differentiates between finished products entering the Indian market and specialized inputs brought in for manufacturing within India.

This approach does not suggest abandoning BIS requirements or allowing low-quality imports, nor does it promote an unregulated environment for domestic manufacturers. It seeks clarity in application.

Furthermore, the policy warns against using standards as a form of protectionism, particularly in government procurement. Such practices could limit competition, escalate costs, and diminish incentives for Indian companies to achieve global competitiveness.

Goyal’s intervention is welcomed as an opportunity to overhaul the broader industrial policy, moving beyond protecting domestic manufacturing. The ultimate goal is to ensure regulations facilitate, rather than obstruct, efforts to attract advanced manufacturing ecosystems and truly ‘Make in India’.