Hardware sector may lose Rs 1,000cr: MAIT

Government makes it mandatory for all manufacturers to comply to BIS standards

The Indian hardware sector may suffer a major slump as it fears a lose of Rs 1,000 crore if the government fails to extend the April 3, deadline of Compulsory Registration Order 2012.

The Manufacturers’ Association for Information Technology (MAIT), today, while welcomed the government order that makes it mandatory for all manufacturers to get their electronic products certified for compliance with BIS standards, it also said that though the companies were ready to comply with these standards and tests, the government needs to address the issues faced by the Industry in meeting the deadline.

The Electronics and Information Technology Goods (Requirement for Compulsory Registration) Order 2012 has put a blanket ban on the sale of certain electronic products unless they meet the standard specified by BIS.

The government order lists products under 15 categories ranging from video games, laptop, notebook, tablet and plasma/LCD/LED televisions, to microwave, printers and scanners, telephone answering machines, electronic music systems, etc.
 
Demanding an extension of the deadline by a minimum six months, MAIT warned that if the government does not pay heed to its advice, there would be a supply crunch in the market and the already troubled IT Hardware Industry would suffer huge losses.
 
“It will also have a huge impact on the Indian Economy as there might be delays in the launch of new products and supply of key components in the market. This will eventually impact the consumers. The shortage and delays in supply will also severely hamper government and private projects, including ongoing e-Governance initiatives in India,” said J V Ramamurthy, President, MAIT.

 
Since the announcement of this Order in October 2012, the government has been sending notifications and clarification from time to time and last of such clarification was issued as late as the second week of March 2013, creating absolute confusion in the Industry.
 
Anwar Shirpurwala, Executive Director, MAIT said, “There are only six labs available for these tests and they take time in testing the products. After testing, BIS takes time for certifying, and then labeling of the products needs to be done. Only after labeling, the products can be manufactured and placed in the market. If the deadline is not extended, the IT hardware supply will get affected resulting in the price hike of these 15 categories of products. Therefore, we request the government to extend the deadline by a minimum 6 months.”

 
Around 8,000 products are to be tested from an average five factories each and these labs take around four to six weeks to test one product. On the basis of the current testing capacity, which is 500 products in a month, the time required to get certificates for each product is fairly long and the deadline of 3 April 2013 set by the government is completely unrealistic, said MAIT.