New Delhi, Jun 18 (KNN) The Global Trade Research Initiative (GTRI) has raised concerns over a recent directive issued by the Ministry of Steel, warning that it could significantly disrupt operations for micro, small, and medium enterprises (MSMEs) reliant on imported semi-finished steel. 

The new order, issued on June 13, mandates that raw materials and intermediate inputs used in manufacturing steel products must also conform to Bureau of Indian Standards (BIS) specifications.

Effective for all consignments with a bill of lading dated June 16 or later, the directive expands the scope of India’s Quality Control Orders (QCOs) beyond finished and semi-finished steel to include input materials such as slabs, billets, and hot-rolled coils. 

The move has triggered concern within the MSME sector, which fears financial losses and operational shutdowns due to non-compliance with the new traceability requirements.

GTRI founder Ajay Srivastava criticised the abruptness of the policy shift, noting that many MSMEs have already paid for shipments that may now be deemed non-compliant. 

“This abrupt change could disrupt supply chains and impose heavy compliance costs on MSMEs reliant on imported semi-finished steel,” GTRI said as quoted by ANI.

Under the revised framework, importers must ensure that input materials used in foreign steel plants to produce BIS-certified steel also meet Indian standards—a requirement that GTRI says could take six to nine months to fulfill. 

“The rule was implemented with only three days’ notice and no stakeholder consultation,” Srivastava added, raising questions about its feasibility and timing.

The traceability clause has emerged as a key challenge, especially for MSMEs that do not have long-term supply arrangements or the leverage to influence upstream supplier certifications. 

Industry representatives have called for a phased rollout or a grace period to allow businesses time to adapt.

While the government has positioned the move as part of its broader quality assurance and import substitution agenda, GTRI cautioned that the lack of transition time could lead to widespread disruptions, particularly in labour-intensive segments of the steel-using MSME sector.

(KNN Bureau)