Regulations and standards must to trade in EU

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By EB Bureau

A seminar on the ‘Entry criteria for market access in the ICTE sector’, organised by the Confederation of Indian Industry (CII), underlined the pressing need for India to have a stipulated regulatory framework, and the importance of conforming to standards in line with global standards for the Information Communication and Electronics (ICTE) sector. The ICTE sector has the potential to develop and manufacture electronics hardware to gain a higher overall share of the global market, besides meeting domestic requirements. However, it is essential that manufacturers in this sector follow regulations that comply with international standards, so that they can easily expand into the international markets.

Impact of lack of regulations

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Inaugurating the seminar, Rajeev Kher, additional secretary, Ministry of Commerce and Industry, pointed out that while many countries have even 3000 items in their mandatory standard lists (China has 265 notified/mandatory items), India only has 80 items under mandatory standards. He pointed out that mandatory regulations will help to create a conducive environment for manufacturing and trading, while ensuring that consumers get good quality products. “The introduction of a stricter regulatory framework would bring with it several accompanying benefits, including the upgradation of technology and manpower as well as the establishment of supporting institutions,” he added. He urged the ICTE sector to draw up a detailed sectoral plan and said that the ministry would support it in doing so.

Adding to this, Ajay Kumar, joint secretary, Ministry of Communication and Information Technology, said that a strict enforcement and vigilance mechanism would also have to be constituted to effectively implement these regulations. He said that proposals related to regulation are currently being examined by the ministry.

Sachin Korde, head, standards division, Nokia India Pvt Ltd, highlighted the issues faced by the mobile phone industry. In the absence of a strict regulatory framework, he estimated that over 50 per cent of the mobile phone instruments imported into the country did not adhere to accepted safety standards. “While the risks posed to consumer health and the environment were significant, these goods are also a drain on the government treasury as they fall outside the VAT net,” he said.

Dr Alok Bharadwaj, senior vice president, Canon India Pvt Ltd, said, “With free trade and a zero duty regime, there has been a free movement of goods, which offers great opportunity for manufacturers to grab a larger market. However, this poses the greater danger of sub-standard products being imported. We should also ensure that we do not allow this to happen. He said that the government would have to act as an enabler while ensuring that standards were established and adhered to. He also called for stricter penalties for defaulters.

Standards and technical regulations

Standards are essential to ensure good quality, human safety, national security and to protect the environment. It is essential to understand that standards are different from technical regulations. While standards can be mandatory or voluntary, technical regulations are always mandatory, as non-conformity to these regulations will lead to the product being banned.

Several mandatory standards need to be followed while entering into business with global companies or selling your products in the European markets. Some of these mandatory standards are CE, EMC (electromagnetic compatibility), RoHS (Restriction of Hazardous Substances) directives, REACH (Registration Evaluation Authorisation and Restriction of Chemicals), etc.

The seminar also pointed out thatICTE companies may also have to face market access barriers while exporting goods or trading in the European markets. These can be classified into two categories—social barriers like safety, health and environmental (SHE) barriers, and technical barriers which are manifested as regulations. Social trade regulations are those measures adopted by a country to achieve the health, safety, quality and environmental objectives of a product, and technical trade regulations are those which ensure a technically good quality product. If an Indian ICTE company wants to trade in the European Union (EU), it is essential for it to sign the Technical Barriers to Trade Agreement (TBT) that ensures that regulations, standards, testing and certification procedures do not create unnecessary obstacles.

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