 "Suresh Sugavanam, VP and MD, UL South Asia")
The Parliament recently passed The Bureau of Indian Standards (BIS) Bill, replacing the 30-year old Bureau of Indian Standards Act, clearing the path to bring more products under the mandatory standard regime. The Bill got bipartisan support/across parties and passed through Lok Sabha & Rajya Sabha without a single edit. The Government has called the Bill revolutionary, an enabler that gives fillip to its initiative to move towards the ‘Zero defect & Zero effect’ (ZED) regime. Why is this so? And what’s in it for our country? This article explores.
Key takeaways of the BIS Bill
The archaic Act of 1986 replaced: The Bill replaces 1986 act to include goods, services and systems, with services being introduced for the first time under the Act. The Bill recognises BIS as a National Standards body with international recognition to represent country in several multilateral & bilateral forums.
BIS gets more teeth: One of the prominent highlights of the bill is that it gives the BIS the authority and power to withdraw sub-standard products from the market. The bureau may recall goods or articles which are already out for sale or supply. This will be done if the Bureau is convinced that the goods or articles do not conform to the requirement of a particular standard.
Mandatory certification of certain goods: The Bill allows the central government to notify certain goods, articles, etc which will need to compulsorily carry a standard mark - if it thinks them to be necessary for (i) public interest or for the protection of human, animal or plant health, (ii) safety of the environment, (iii) prevention of unfair trade practices, or (iv) national security.
Self-certification/declaration: Pushes the Make in India agenda.
Increased business accountability: In case of offence committed by any company, every director, manager and secretary responsible for the conduct of the business would be liable, irrespective of the fact that the offence has been committed with or without their consent or connivance, thereby increasing accountability (offence is any non-compliance to standards and specifications and ISI mark requirements).
Penalties: The penalty for improper use of the Indian Standard mark will be a fine of up to five lakh rupees. The Bill also prescribes penalties for: (i) the improper use of the standard mark by testing and marking centres, and (ii) manufacturing or selling goods and articles which do not carry a standard mark and have been mandated to do so, among others. The Bill provides for compounding of offences punishable with fine except when a person has committed such an offence for the second time or if such an offence committed by him has been compounded earlier.
A boost for Make in India and the manufacturing sector
With the industry batting for reviving the manufacturing sector, strengthening the services sector, the product/service offerings have to be best in class with no compromise on safety, quality and performance - these have to be cornerstones of Make in India. A focus by the manufacturers on ‘basics’ (safety, quality and performance) is necessary both in the short term (to get a ticket to the export market) and the long run (to enable creation of healthy, sustainable business and industry).
This theme is applicable for larger industries/companies as well as the SME sector. Adopting and implementing global standards in India (whether voluntarily by the industry or mandatorily, eg, by the industry or Government) is an essential first step to create such level playing fields. The Bill for the first time introduced the concept of conformity assessment with multiple certification bodies; this will ensure easy implementation and upholding desired levels of consumer safety and product quality.
The penalties for substandard product/service (holding the top management responsible, the risk of product recall, etc) will ensure focus on quality.
This is good for the consumer!
It is imperative to understand that standards and quality play an important role in consumer protection and enhancing quality of life. Whether it is technology products, automobiles or the healthcare, private players will have to be accredited with world class/Indian standards.
In the medium-to-long term, expect that only quality products will make it to supermarket shelves and our homes. The products that lack the expected global/Indian standards will be recalled; the resolution of consumer grievances will be speeded up, with potential consequences for the manufacturer/service provider.
This will enable a better quality of life in the 21st century India.
The government gets more teeth
Suresh Sugavanam, VP and MD, UL South Asia
The introduction of the concept of multiple third party certification bodies can provide a means of a more cost-effective administration and oversight for the government, faster time-to-market for manufacturers’ goods, and upholding desired levels of consumer safety and product quality.
Next steps for the government
The government, particularly the Ministry of Consumer Affairs (MoCA), has the onus to write the rules & regulations that will guide the implementation of the Act. And while the onus is on MoCA, the government will also have to work with various departments and ministries to create the regulatory and conformity assessment framework. The empowered or relevant ministries in turn will have to hold consultation meetings with several stakeholders before bringing in any mandatory, voluntary or self-declaration program.
If there is a self-declaration program of conformity for any product category, the program will need to be vetted cautiously due to several challenges leading to non-compliance and other consumer safety issues. Product recall, product liability and market surveillance mechanism will need to be robust.
All this will take time ranging from few months to a few years. It would be important to have a clear set of deadlines to arrive at consensus and formulation of rules. Even though the intent of the Government and the bipartisan support that this bill received hints at clarity of thought, it is the bureaucracy that will need to work with a sense of urgency to ensure quick implementation.
Conclusion
The Government’s flagship initiatives of Make in India, Digital India, Smart Cities, etc are already catapulting the economy onto a higher growth trajectory. That given, one of the most imperative criteria for the success of these programs would be a robust regulatory and compliance framework, with time playing a key role.
The BIS Bill 2015 couldn’t have come at a better time. It is a landmark Act that would help pave the way forward for a safer India - an India where consumers step up to demand and enjoy better quality products, where the manufacturers realise the importance of quality and standards and use it as a level playing field to compete in the global market and take India towards its rightful place.
The Bill creates the opportunity. How quickly and effectively can we follow through? Towards a safer, more quality conscious India… the 21st century India.
__________________________________________________________________________________________________________
Suresh Sugavanam is the vice president and managing director of UL South Asia
