India is a very unique place when it comes to policy making and legislation. It comes from a place where the government thinks about the public at large and is efficient in the same. Government makes use of principles, institutions, norms, values and rules through which public affairs are managed in act of governance. Policy making is a subset of actions to achieve the desired objective.
Hurdles faced in terms of rules and regulation while investing in companies:
Technology is advancing at a rapid pace. This is especially true for Research and Development in defense, agriculture, software etc. So there’s always going to be this gap. Regulation is always going to catch up to policy which is going to catch up to real-world technology.
The second thing is that a lot of the technologies and businesses the policy maker’s invest in, are not the users of those products. They’re unfamiliar with the worlds they are trying to legislate. There are companies that help in bridging the gap. There policymakers and legislators, quickly accelerate how they design policy. Technology will allow foreign companies to succeed in India.
Thirdly, when a policymaker makes a law he thinks about everyone in the country the well off and poorest of the poor. One of the hurdles with the policymakers is the absence of the right information. Instead of providing them with benefits, you harm the general public. You can’t impose an outside view and impose on the Indian view.
Sectors that are heavily regulated and less regulated for foreign investors:
They are three basic kinds of ballpark pillars in this:
The government ensures the sectors that allow foreign direct investment, safeguards the sovereignty, safety, the national interest of the country. Thus, the companies in these sectors are heavily regulated as it concerns the general public.
Sectors having impact significant impact on social equity-like insurance, financial services, health have an impact on society at large are also heavily regulated.
To take care of societal constraints, the government makes sure that sectors have Indian owners. Don’t run the risk of impacting social equity, in a way that, may impede the bottom of the pyramid.
The rise in Technical Regulations in India:
Mr Alok Kesari – Senior Technical Advisor & Deputy Head, Country Component India (GPQI-India) discussed market access in India and the impact of rising technical regulations.
Small and medium-size enterprises are facing a lot of challenges with the rising technical regulations, at least at the initial stage. These challenges vary from lack of information on new regulations to unclear implementation and compliance procedures. They have a high potential to become technical barriers to trade.
Five years ago, only around 100 products were regulated in India. Today, more than 400 products are falling under technical regulations. In 2020 alone, more than 200 products are notified.
India’s quality infrastructure underwent massive changes in the last five years – both at a strategic and operative level. These changes include a national strategy. The Indian National Strategy for Standardization, the revision of the BIS Act in 2016, provides more flexibility in conformity assessment. For example, for some products, it is possible to obtain a BIS license without the need for a physical visit of the BIS officer to the manufacturing premises.
The Global Project Quality Infrastructure (GPQI) of the German Federal Ministry for Economic Affairs and Energy (BMWi) supports companies by providing relevant information. They also develop solutions to technical market access problems in close collaboration with relevant industry associations and technical organisations.
You can access information related to technical regulations in India on the website of the Bureau of Indian Standards, concerned ministries and the Global Project Quality Infrastructure. Companies who are interested in learning more about the quality infrastructure landscape in India can also refer to the publication “Overview of India’s Quality Infrastructure” on the GPQI website.
How can a manufacturer check whether BIS is applicable to their product or not?
The manufacturer has to continuously check the Website of the Bureau of Indian Standard (https://bis.gov.in/)
On the other hand, the product certification in BIS registration fall under 2 categories:
- Compulsory Registration Scheme (CRS):It covers Electronics, IT Goods, and Renewable Energy (Solar Products). License is granted for initial 2 years. Eventually, we can renew for another 2-5 years. Furthermore, the link to see the list of products under CRS (https://bis.gov.in/index.php/product-certification/products-under-compulsory-certification/scheme-ii-registration-scheme/)
- ISI Mark Scheme: It covers product categories ranging from Cement, Electrical goods, Food & related products, Medical equipment, etc. License is granted for an initial period of 1 year. Eventually, we can renew for a period of 1-5 years. Furthermore, the link to see the list of products under mandatory BIS registration (ISI) (https://bis.gov.in/index.php/product-certification/products-under-compulsory-certification/scheme-i-mark-scheme/)
If a manufacturer manufactures a particular kind of product, he has to check the applicable standard carefully. The applicant has to comply to each and every standard carefully. Furthermore, BIS won’t grant the license if the conditions of the standards aren’t fulfilled. However, in case of different specifications of products, applications can be filed with the concerned Ministry for No Objection Certificate (NOC). Indian customs will clear the goods upon receipt of NOC. Nevertheless, for every shipment which arrives in India, the manufacturer obtains the NOC from the BIS authorities.
Generally, the buyer in India notifies the manufacturer in the other country to obtain a license for his product. The consequence of not obtaining the license results in the termination of his selling in India.
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