Ministry of Steel Issues Clarificatory Order on Quality Control Order

The Ministry of Steel has recently issued Quality Control Orders enforcing 151 Bureau of Indian Standards (BIS) standards, marking the first update since August 2024. This new directive, effective from June 13, 2025, mandates that intermediate materials used in the production of steel products must also comply with BIS standards. This decision aims to level the playing field for domestic manufacturers and ensure the quality of steel products in India.

Ensuring Fair Competition for Domestic Producers

The Ministry’s latest order addresses the disparity between domestic steel manufacturers and importers. Currently, Indian producers are required to use BIS-compliant intermediate materials, while imported finished steel products do not face the same requirement. This inconsistency places local manufacturers at a disadvantage, as they must adhere to stricter quality standards than their foreign counterparts. By enforcing BIS standards on intermediate materials, the Ministry aims to create a fairer competitive environment, ensuring that all steel products in the market meet the same quality benchmarks.

Quality Assurance for Finished Products

Compliance with BIS standards for intermediate materials is crucial for maintaining the quality of finished steel products. If the base materials, such as hot-rolled (HR) or cold-rolled (CR) coils, do not meet these standards, the final products, like coated steel, cannot be guaranteed to be of high quality. This is particularly relevant given the significant volume of coated steel imported into India. The Ministry emphasizes that without ensuring the compliance of these intermediate inputs, the integrity of the final products could be compromised, potentially leading to substandard offerings in the market.

Addressing Concerns Over Substandard Imports

The Ministry of Steel has raised alarms about the potential influx of substandard steel imports, especially in light of excess production capacity and declining consumption in certain countries. As India continues to be one of the fastest-growing major economies, there is a heightened risk of low-quality steel being dumped into the market. The Ministry warns that if intermediate materials are not compliant with BIS standards, the resulting finished products will also fall short of quality expectations. This situation could adversely affect the domestic steel industry, particularly smaller manufacturers, and lead to significant job losses.

Future Capacity and Economic Implications

India’s steel consumption has been on an upward trajectory, growing at over 12% annually for the past three years. This growth is driven by government initiatives aimed at strengthening infrastructure and boosting manufacturing. To meet the increasing demand, the country will require approximately 300 million tonnes of steel capacity by 2030 and 400 million tonnes by 2035, necessitating an investment of around $200 billion. The Ministry warns that allowing substandard imports could jeopardize the domestic steel industry’s ability to expand and innovate, ultimately hindering economic growth and employment opportunities in the sector.

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