Nike, Mitsubishi struggle to get Indian certification for Chinese vendors

The government is taking its time granting quality certification to Chinese factories for products subject to quality control orders (QCOs), reports The Economic Times (ET). This is raising pressure on companies to reduce their reliance on Chinese imports and instead focus on domestic production.

The ET report said that companies such as Nike, Mitsubishi, and Carrier, among others, are having difficulty obtaining Bureau of Indian Standards (BIS) certification for their vendor factories in China. 

According to a senior government official, these companies have now written to the government to seek certification for manufacturing plants in other Asian countries. However, the government is hesitant to accredit factories located even in the Association of Southeast Asian Nations (ASEAN) countries with which it has a free-trade agreement. 

These include Thailand and Vietnam, as the government is concerned that corporations may import Chinese items through these countries as a "backdoor entry" with no value added, ET quoted industry and government sources as saying.

The report added that Nike has requested the government to certify the factories of its suppliers in Indonesia and Vietnam so that it can continue to import from there. The company has asked for "timely certification of overseas factories in Vietnam and Indonesia (26 suppliers to Nike and Converse have submitted their applications since May 2023)."

Meanwhile, a Carrier Midea India spokesperson told ET that the company's finished products, including window, split, and ducted air conditioners and individual components such as compressors and heat exchangers, comply with BIS guidelines and satisfy the stated criteria.

"However, in the case of VRF products, BIS is necessarily required for hermetic compressors," the person said, adding that such compressors are not currently manufactured in India.

"So far, the VRF product segment contribution is quite low in the overall category, resulting in low volumes," the individual explained. "Therefore, the manufacturing facilities for this type of compressor are currently not available in India, which is an industry-wide concern. "