The much-dreaded April 4 deadline for certification of imported electronic products in India has passed. The Department of Electronics and Information Technology (DeitY) had mandated that all imported electronic goods should obtain a clearance from the Bureau of Indian Standards (BIS). That was a year ago, as E2 India reported.
However the compliance deadline was pushed back many times as the industry exerted pressure on the government. E2 India also tracked the tussle between the government and the industry. While the Indian government was intent on cracking down on the gray market, the industry resisted cumbersome certification procedures that they said threatened sales of 15 product categories ranging from laptops to microwave ovens.
True, many companies have rushed to comply -- Samsung Electronics, LG Electronics, Dell, Hewlett-Packard, Sony, and so on -- which means the BIS should be on its toes clearing registration requests and granting certifications for a number of brands, right? Not really -- only about 781 manufacturers have completed registrations. Many of the requests of registrations are still pending and many even face the risk of rejection for not completing all the actions required under the process. As a result, the registration process is tardy.
While the industry is delaying total compliance with the hope of getting extensions, the government is also extracting its pound of flesh by adding new categories of products or spelling out additional norms!
For instance, on March 25, the BIS issued a fresh notification that stipulated new guidelines for labeling of products. Instead of stickers -- which were earlier the approved method of labeling -- the government now wants manufacturers to screen-print, emboss, or engrave labels on products and packaging material. The revised labeling rules also specify that the font size of the letters should be 12-pt or one fourth the size of the brand name or whichever is lower. Where labeling is done in one fourth the size of the font used for the brand name, the font size should not be below 6-pt.
Every time there is a change in norms, compliance is challenged. For instance, in the case of the change to labeling guidelines, the fact that the product size may pose a problem to packaging and labeling requirements has not crossed the minds of policy-makers. For manufacturers of tablets and phones, new product launches will require new production lines to comply with BIS guidelines that mandate embossing/engraving -- a practice not followed anywhere else in the world. With product models changing rapidly, the use of stickers has become more prevalent. While this is the practice globally, OEMs will need to plan for retooling that allows embossing and engraving their product lines for the Indian market alone. Also, metal plating or engraving is difficult on such products.
Led by industry body MAIT, some players including Sony, Lenovo, Panasonic, and Videocon have appealed to the Indian government to rethink the norms. With new models of their products unable to comply with the labeling norms and not reaching consumers here, there will be an artificial escalation of prices, they have warned.
The 2014 Technical Barriers to Trade report of the US Trade Representative has also objected to the mandatory testing and registration of imported electronic goods in India. It has pointed out that the U.S. electronic exports currently sold in India are fully certified in internationally recognized laboratories, and that the government of India has never articulated how such a domestic certification requirement advances India's legitimate public safety objectives.
"Notwithstanding ongoing efforts by global industry to engage the government of India to resolve concerns and ambiguities in the policy without undermining those objectives, the Order entered into force in January 2014," it said.
"Although U.S. industry would ultimately like to see the entire policy repealed, an important first step is to seek an exemption for Highly Specialized Equipment (HSE), including servers, storage, printing machines, and IT products that are installed, operated, and maintained by professionals who are trained to manage the product's inherent safety risks," the report added.
So CIOs, you can expect to see a lot of action on this front in coming days. What impact do you think these rules will have on import/export of electronics? Let us know in the comments below.