India plans mandatory certification of more chemical imports

Author: Priya Jestin

2019/11/22

MUMBAI (ICIS)--India is finalizing plans to increase the number of chemicals and petrochemicals to be covered by mandatory certification, as a means to reduce excessive dependence on imports.

The move will also help boost domestic production of these chemicals, in line with the government’s “Make in India” initiative.

Products marked for certification must conform to the corresponding specifications from the Bureau of Indian Standards (BIS).

For exporters to India, this could mean shipment delays to or even temporary closure of the south Asian market, which befell caustic soda sellers last year.

The certification adds another layer of business processes that must be overcome to access the market.

The full list of products on which mandatory certification is to be required will be issued by the Ministry of Chemicals and Fertilisers. Industry players have been notified of the proposed change in regulations by the Department of Chemicals & Petrochemicals.

The list will include products that are imported in huge quantities and impact the domestic industry.

“This mandatory certification was introduced as a non-tariff barrier against inferior imports and caustic soda was the first chemical to be covered under this certification in April 2018,” said K Srinivasan, secretary general of the Alkali Manufacturers Association of India (AMAI).

The imposition of BIS norms on caustic soda caused its prices to slump initially, with companies selling to India forced to find new markets at a short notice.

“The effect of the [caustic soda] notification was for a short period [which was effectively the duration for exporters in other countries to obtain their BIS licence] as most countries are already producing caustic soda by the membrane cell technology which meets the specification requirements as per BIS standard,” said Srinivasan of AMAI.

“From our experience, we feel that these measures may not always serve to regulate imports if globally superior quality of chemicals is being produced,” he said.

India’s caustic soda imports declined for about six months into the implementation of the mandatory BIS certification, but bounced back to high volumes thereafter.

Mandatory certification took effect for aniline in October, while methanol and acetic acid will be subject to the same rules in February 2020.

While there are existing standards on other chemicals, certifications are done on a voluntary basis.

In late October, in consultation with industry representatives, the government decided to impose BIS standards on vinyl acetate monomer (VAM) and eight other chemicals, namely, phosphorus trichloride, phosphorus pentachloride, phosphorus oxychloride, sodium sulphoxylate, sodium triphosphate, barium carbonate and hydrogen peroxide.

Formal notification on this has yet to be issued and it would take another six months after publication of the notice in a gazette before the mandate takes effect on the latest inclusion in the BIS certification requirement.

“Industry stakeholders have been asked to provide specific names of major products so that they can be taken for consideration to make BIS standards mandatory,” said a polyester producer based in Gujarat.

“Initially, the proposal was for making standards mandatory for 40 chemicals. The government then decided to widen the ambit to include more chemicals and divided them into categories,” the producer said.

BIS standards are currently being formulated for phthalic anhydride and ortho-phosphoric acid, a source from the chemicals & fertilizers ministry said.

For certain chemicals and polymers that already fall under the BIS ambit, standards are being reviewed for possible changes.

These include phenol, acetone, toluene, styrene, ethylene dichloride (EDC), ethylene glycol, butyl acrylate, maleic anhydride (MA), acrylonitrile (ACN), linear alkyl benzene (LAB), purified terephthalic acid (PTA), monoethylene glycol (MEG), among others.

The list also includes polymers, polyesters, polyurethanes, polycarbonates, polyvinyl chloride, and various kinds of plastics.

Once the new set of standards for various chemicals are implemented, domestic and foreign companies will be required to obtain permits before they can import, manufacture or use the listed chemicals.

“More chemicals are planned to be brought under compulsory certification requirements,” Srinivasan of AMAI said.

The government is currently in the process of getting feedback from relevant industry stakeholders on the plan.

“The process may take about one year’s time and time will be given for comments from the industry,” the Gujarat-based polyester producer said.

Focus article by Priya Jestin

Photo: Vallarpadam Terminal in Kochi, Kerala, India. (By Olaf Kruger/imageBROKER/Shutterstock)