Lok Sabha Question No. 1912 (UNSTARRED), answered on 2025-12-11
Subject: Implementation of Quality Control Orders
Ministry: MICRO, SMALL AND MEDIUM ENTERPRISES
Asked by: Shri Matheswaran V S

## GOVERNMENT OF INDIA MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES

## LOK SABHA UNSTARRED QUESTION NO.1912 TO BE ANSWERED ON 11.12.2025

## IMPLEMENTATION OF QUALITY CONTROL ORDERS

## 1912. SHRI MATHESWARAN V S:

Will the Minister of MICRO, SMALL AND MEDIUM ENTERPRISES be pleased to state:

- (a) whether the Government has considered phase-wise implementation of Quality Control Orders, exemptions  for micro  and  small enterprises or simplified standards and relaxed  compliance requirements  for  MSMEs  to  ensure  that  the  implementation  of  QCOs  does  not  disrupt  domestic production and if so, the details thereof;
- (b) the  details  of  the  measures undertaken to streamline and rationalize interest rates charged to micro and small enterprises being a priority sector by banks and NBFCs;
- (c) whether data is available on interest on the interest rate spread and pricing practices followed by  private  financiers  and  NBFCs  particularly  for  micro  and  small  enterprises  and  if  so,  the  details thereof; and
- (d) the  steps  taken  or  proposed  by  the  Government  to  reduce  high-cost      private  financing dependence among micro and small units and promote access to affordable formal credit?

## ANSWER

## MINISTER OF STATE FOR MICRO, SMALL AND MEDIUM ENTERPRISES (SUSHRI SHOBHA KARANDLAJE)

(a): The Government of India through Bureau of Indian Standards (BIS), Department of Consumer Affairs,  Ministry  of  Consumers  Affairs,  Food  &  Pubic  Distribution  implements,phase-wise,Quality Control  Orders  (QCOs)  issued  by  the  line  Ministries  with exemptions/relaxations  for  MSMEs , to ensure  that  Quality  Control  Orders  (QCOs)  do  not  disrupt  domestic  production.  Some  of  the  key relaxations and exemptions are as below:

-  Additional  time  for  Micro  and  Small  Enterprises  (MSEs):  6-month  extension  for  micro enterprises and 3-month extension for small enterprises.
-  Exemption for imports by domestic manufacturers for producing export-oriented products.
-  Provision  for  clearance  of  legacy  stock  (manufactured  or  imported  before  implementation) within six months from the effective date.
-  Exemption for import of up to 200 units for Research & Development purposes.

The Bureau of Indian Standards (BIS) has informed that based on the feedback on certification processes, BIS has implemented the following financial and technical relaxations to MSME sector:

-  To support MSMEs, financial incentives are provided by BIS in annual minimum marking fee with concession of 80% (for Micro Enterprises), 50% (Small enterprises) and 20% (Medium Enterprises). An additional concession of 10% is also provided to enterprises which are either located in north-east areas or women entrepreneur MSME units.

-  The requirement of maintaining in-house laboratory has been made optional for MSME units. MSME units are allowed to utilize the services of outside BIS recognized laboratories, NABL accredited  labs  or  even  sharing  of  resources  like  cluster  based  labs  or  laboratories  of  other manufacturing units.  The 'Levels of Control' in the Scheme of Inspection and Testing (SIT) are  made  recommendatory  in  nature.  The  manufacturer  has  the  choice  to  define  their  own control unit/batch/lot and their own Levels of Control and inform the BIS.
-  BIS has also made the product certification process guidelines publicly available on the BIS website.  BIS  also  issuing  product-wise  manuals  as  guidance  documents  for  conformity assessment as per various Indian Standards.

(b) to (d): As per the  information  provided  by  Reserve  Bank  of  India,  with  a  view  to  improve monetary  policy  transmission,  banks  have  been  advised  by  Reserve  Bank  of  India  to  link  loans  to MSMEs to an external benchmark. The reset clause for loans has been reduced to three months under the  external  benchmark  system.  Further,  to  make  the  benefit  of  external  benchmark-based  interest regime available to the existing borrowers, banks have been advised to provide a switchover option as per mutually agreed terms. Further, RBI also taken various other measures for improving credit flow to the MSME sector: some of them are as under:

-  The  government  has  announced  Mutual  Credit  Guarantee  Scheme  for  MSMEs  (MCGSMSME),  a  government-backed  initiative  designed  to  help  Micro,  Small,  and  Medium Enterprises  (MSMEs)  access  loans  to  grow  their  businesses.  This  scheme  offers  a  credit guarantee,  making  it  easier  for  MSMEs  to  obtain  loans,  especially  for  purchasing  essential equipment and machinery. The Scheme provides credit guarantee cover to lenders (Scheduled Commercial Banks, All India Financial Institutions, NBFCs) for their term loans up to Rs.100 crore to MSMEs for their projects involving purchase of equipment/machinery.
-  Specific targets for lending to MSME sector have been prescribed in Priority Sector guidelines.
-  Schedule Commercial Banks have been mandated not to accept collateral security in the case of loans up to ₹10 lakh extended to units in the MSE sector.
-  Computation  of  working  capital  requirements  of  MSE  units  to  be  minimum  20%  of  the projected annual turnover for borrow limits up to ₹5 crore.

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