Aluminum, steel, copper and other high-quality base metals fall within the scope of Quality Control Orders (QCO) in New Delhi, covering a large number of industries such as automobiles and large appliances, which are prone to risk of input quality.
But the high precision, a small portion of expensive metals and polymers covered in quality control orders are also a major investment in electronic manufacturing, while blanket import curbs present procurement challenges, risking India’s competitive competitiveness in exports in emerging Asia, industry managers said.
A leading global electronics executive said: “Supply chain stores are all over the world, including China, Japan, and South Korea.”
“When implementing extensive QCOs on fund products such as copper or aluminum, the electronics sector can also be inadvertently harmed, resulting in supply and procurement restrictions,” the executive said. The industry said that since electronics are covered by the Mandatory Registration Order (CRO) Program II and are tested and certified, materials and inputs that should be exempted from QCO restrictions.
According to the electronics industry, QCO plays an important purpose for high batch precision sectors such as aluminum and steel, which do not require the same refining standards as electronics. Electronic manufacturers need very high-end raw materials that are both niche and technically complex in nature, and currently, India does not have a reliable in-house supply of raw materials and inputs. It is certain that QCOs are increasingly inclined to become increasingly obvious in India’s prominence, due to the escalating tariff rate escalation between the two largest economies on the planet.
PLI risk
Another executive said some of the materials covered by these QCOs are crucial to the components and subcomponents made by phones. “These materials need to be imported to meet high-tech standards and precision requirements and are part of maintaining high-quality products produced in India,” executives said. The Indian Cellular Electronics Association (ICEA) also wrote to the government that the imposition of QCO may cease manufacturing due to insufficient investment. “This will further undermine supply chains, hinder production targets and hinder the ability of Indian-made products to integrate into the Global Value Chain (GVC),” Icea said in a letter to the government.
In addition, industry executives pointed out that imports of such materials and inputs are for specific purposes and that the quantity is tiny compared to the overall import of the QCO category.
