Opportunities and Benefits for Domestic Plywood Manufacturers In View Of QCO Implementation

Suresh Bahety

Today this forum is proud to see the aesembly of plywood warriors form every corner of the country.

Everyone is excited as the date of QCO implementation is closing.

Till now, a demand for extension of dates was in the air from everyone, suddenly, by changing the tune, PPMA demanded its immidate implementation, without any extension, which was later supported by HPMA, AIPMA, AIPLI and DNPMA.

In our last webinar, Pradeep Shekhawat of BIS, had admitted that some amendments have been done in the BIS standards in view of changed scenerios in production pattern which was demanded by industry.

Since these amendments are not published yet, suspicion and confusion remains in the industry.

Till now, BIS was optional. That’s why; a major part of the industry was out of the preview of BIS.

It will be interesting to know, how BIS will make them comfortable to join

There are so many concerns of the industry to be taken care of.

Dr.MP Singh

Our industrialists are now ready to produce as per the quality standards of QCO. It was first notified on August 10.

However, earlier the industry was demanding that it should be implemented with some changes. But now they have understood that QCO is bringing an opportunity for everyone. Under the current circumstances in the country, a consensus has developed that QCO should implemented without any delay.

Some arguments were put by the industrialists, which created some confusion. We should unite to overcome this situation.

The feedback received from Gujarat and Kerala revealed that 90 to 95 percent of the industries have not taken BIS certificate. They don’t even feel the need for it. Because their product is demanded by a particular category.

Now in the verge of madatory BIS standards, they are afraid that their industry will be closed. Therefore, our suggestion is that we should come together to understand whether MSMEs should be kept out of QCO or given more time.

If low quality standards are maintained then importers can also dump this category.

The situation whatever has changed in six months, all the industrialists will have to come together towards implementing QCO. And develope a mutual understanding and be ready to keep MSMEs out of it.

There are many such industries in which MSMEs have been kept out of QCO. Because these units are able to produce only low quality goods. Therefore, the option of keeping MSMEs out of this will have to be discussed and a consensus will have to be reached.

It would be better to keep MSME’s out of the ambit of QCO: Naresh Tiwari

It would be alright to keep MSMEs out of QCO.

Even if they are provided time in this, perhaps there will not be much change in their circumstances.

But the goods imported will continue to be dumped in India: Inderjit Singh Sohal

If MSMEs are kept out of QCO, low quality goods from abroad will continue to be dumped in India.

If MSMEs get concessions, the government may not be able to ban low-quality goods from being imported.

Due to low demand, 50 percent of the units are closed in Punjab. The production units are running on under capacity.

This will not happen: Dr. MP Singh

As far as I understand, this will not happen. Still, this can be discussed further.

It is not possible that all the licenses will be taken as soon as. QCO will be implemented therefore we have to think about MSMEs.

We are consumer before producers, our thinking should be changed: Ashok Aggarwal

Before producers, we are primarily consumers. And every consumer should have the right of quality goods for which we are paying. Therefore, quality standards should be fixed in the wood industry. Unless there is fix quality standards, there will be no quality in the industry.

Therefore QCO should be implemented as soon as possible. It should be implemented in large, medium and small units within its time limit. Time should be given for this, but quality standards should be implemented.

Farmers will also benefit from QCO: Devendra Chawla

A major part of goods manufactured in India, is manufactured in Yamunanagar. 150 industries are closed due to imported goods.

The timber industry is in dilema. It should not happen that the farmers who grow wood also suffer losses along with us. Working under the flagship of Make in India and Made in India, we can produce goods of international level quality as per BIS standards.

Why should anyone buy a product below the prescribed standards, why should consumers get a product of low quality. We are capable of providing high quality products to our consumers. Initially industry was not confident, but today we have achieved that stage.

BIS standards should be implemented immediately. If not our markets will be flooded with low quality imported goods. The industry, people associated with the industry and farmers may have to bear the brunt of this.

Plywood is coming from Vietnam. 50 to 60 vehicles of plywood are coming from Nepal. Whose weight is only 20-25 kg, whereas the weight of our product is 35-40 kg.

What will happen to the rejected goods? Dr. Prasanth M.A.

BIS standards are under discussion for a year. There are always some difficulties in implementing any new policy and new system in the beginning. Still there is a big question mark to the rejected goods?

BIS hires the services of outside agency for inspection. They are short of staff. Due to this, there is some doubt among the industrialists. Industrialists are keen on BIS standards if such doubts are removed.

There is no doubt that imports should be stopped. Especially products coming from Vietnam should be banned.

BIS standards was implemented in toy industry. Only 36 licenses were given initially at the international level. China was not given license in this. And now this industry exports instead of importing.

It is very much possible that the government is working with same thinking in plywood also. We have to decide for utility grade very carefully.

We have everything the industry needs. Farmers who grow timber, land on which trees can be grown.

Therefore I feel that our industry is fully ready to accept BIS standards.

MSMEs should be given time: Sonu Aggarwal

MSMEs should be given time. Micro, small and medium enterprises are in MSME. Large and medium units are kept in one category in QCO. The government considers it one, hence no time was given. Very small units are being given time of three to six months.

It will be interesting to see how many industrialists take license.

A decision can be taken later on whether micro & small should be exempted or not.

Right now, if the government is asked to give exemption to MSMEs but impose a ban on imports, it may not be possible for the government to do so. Therefore, QCO should be allowed to be implemented at it’s proposed date.

It is not right to implement utility grade in a hurry. Because there is a possibility of dumping. I believe that most of our industries, especially the big and medium scale entrepreneurs, are affiliated with BIS.

Those who have not taken the license either had no need or desire to take one. Now it has become necessary to take the license after the QCO. Eight hundred people have licenses, some have one, some have three or four. Eight hundred and fifty licenses did not renew. They may have faced any kind of difficulty in renewel.

I believe that it is not appropriate to give time again and again, because the entrepreneurs who have been working for ten to fifteen years and are not taking the license, they will not take the license no matter how much extra time is given to them. Even after the announcement of QCO, licenses are decreasing. There are two reasons for this, either they do not have awareness or there is no need.

Stop marking is a big problem. There must be a solution for it. It will be a setback for a factory to be closed due to stop marking. Instead, industrialists should be provided a platform where they can appeal. His license may be cancelled. Due to which he have to apply the license afresh. But closing the factory is not the solution to this problem.

Whether to make utility grade or not is a challenge: Dr. MP Singh

It is true that the medium industries definitely does not need time. But, there should be exemption for micro and small.

It is a big challenge for a consensus whether to make utility grade or not. If made, there is a possibility of dumping. What could be the solution to deal with the situation? We will have to think and discuss about this.

What are the options for packing grade ply?

Packing, grade ply usually made in small units. We often use normal grade plywood in homes also. Sometimes a ply is needed only for one use.

The situation in South India is somewhat different from North India.

We have to decide what we want?

Should reject grade be brought into utility grade?

It was also decided in the BIS meeting that there should be a utility grade.

Still, it is necessary to brainstorm.

Whatever results emerge, it will benefit the country, industry and market.

Those who did not renew their licenses should be given a chance: Devender Chawla

Eight hundred and fifty units, who did not renew their licenses, are now asked by BIS to re apply. The request is that now the policy should be made for them that they do not have to apply afresh, rather the licenses should be renewed.

If the goods do not meet the quality standards, production should not be stopped immediately. Because then the entire unit will be affected. Therefore, there should be such a provision that warning should be given for the first time, strict warning should be given for the second time and stop marking should be done in the third time.

BIS officials have assured their full co operation: Inderjit Singh Sohal

BIS has assured us that there will be no problem from their side. Will give the license within twenty days.

Import should stop. Or the quality of imported goods should be in line with our quality.

Making wooden products in the country is beneficial to everyone. Farmers will also get support from this. We can implement Make in India- Made in India.

We should not bind ourselves to any limit: Abhishek Chitlangia

It is not correct to say that the quality of all imported goods is low. It depends on the importer.

Cheap plywood is made also in India. Therefore, instead of criticizing imports, we should look inwards. Criticism of imported goods is not correct.

We should not put limitation on ourselves. If we want to prove ourselves at the international level, we should work with an open mind. In our own country every unit does not have BIS license, then how can we talk about the quality of the imported goods?

There should be no delay in implementing QCO in the name of MSMEs: Arwinder Singh

Benefits of GST are visible now. Therefore, we will definitely benefit from QCO also.

Indian furniture industry will be able to touch the international level only when they will get high quality plywood.

We are not going to bind ourselves just to stop imported goods. We are protesting against dumping of low quality imported goods.

Use of fake ISI mark should be banned. Because this defame our own industry.

BIS will be implemented any how, then why is it not being implemented now. Due to MSMEs, there may be delay in implementing QCO. BIS officials say that they will release the license within twenty days.

Once the standard is implemented, it should be seen who can be given exemption and how much.

BIS can force industry once it is mandatory: Suresh Bahety

BIS officials say that right now using BIS mark depends on the willingness of the industrialists, whether they want it or not. But if once it is mandatory then the BIS will be able to force every manufacturer to take a license.

Quality standards should be such that the industry can meet them easily: Dr. CN Pandey

Quality control order should be implemented. There was no pressure on anyone for the license uptill now. But now BIS license will be mandatory.

It was told by the industry that the small duration wood being used as raw material is affecting the quality. Keeping this in mind, Dr. Singh came up with the proposal to set such product standards that neither the industry is put under pressure nor quality standards deteriorate.

No unit is able to produce 100% quality product. It is not that our industries are not capable, but there are chances of some error at the time of production.

Now if anyone aspect of a standard is not met then it would not be right to underestimate the quality of the entire product.  It was suggested that such goods should be kept in reject grade, but it was not considered perfect.

Now markings as utility grade is suggested. Because this type of product can be used in such applications where low quality plywood is used.

Quality control orders should be used as an opportunity. Will continue to discuss other remaining issues latter on.

The government was doubtfull whether our manufacturers are able to make products of quality standard after getting the BIS license.

Our small units who are not in the mainstream, till now, should get the license and do quality production, what could be better than this.

Whenever we compete, definitely our quality improves.

Why can’t we produce a quality product? This is not a very complicated technique. It’s possible.

Making products from short rotation wood difinitely creates problems. This should be paid attention to.

Scientists, government and institutions, everyone is ready to work with you. Now it depends on the industry as to what direction it wants to go.

What should be done with rejection is a matter of policy: JK Bihani

Everyone wants that QCO should be implemented.

A policy should be made on what should be done regarding rejection. If rejection is marked on such goods then it can not be marketed.

If the sample fails twice then marking is stopped. But now because this is a period of change, three chances should be given instead of two.

After three failures, required quality testing should be done in the factory permises itself. This should happen within a week. So that chances for closure of the factory is minimised.

Amended BIS standards should also become public now. We have given our suggestions.

Use of zuvinle wood, especially poplar, cannot provide the required MoR value. Standards should be set in view of the actual performance. Only then will QCO be implemented smoothly, and better results will emerge. It should not be made so difficult that it becomes difficult to fulfill.

It may take a year or two for the industry to adapt the new environment.

New micro and small units who joins BIS should also get some concession.

It does not seem to be possible to stop imported goods, if its quality is at par.

In short:

1. QCO should remain in force as notified.
2. Concession should be given in stop marking.
3. Solution for a utility grade should be found.
4. Instead of two chances, three chances should be given in stop marking.

Stop marking is a matter of concern: Manoj Gwari

A separate category has been created for imported wood products under the provisions of BIS.

Therefore, if concession is given to MSMEs, then this concession will not be applicable on the imported products.

Like GST, BIS should also be applicable as one country, one law.

The notification which came in August is to be implemented in February and for Micro it is to be implemented in April.

Micro units are getting 80 percent discount in fees, yet only thirty to forty percent have applied.

Concern about stop marking is justified. To save the time, verification can be done only for the particular reason for which the sample is failed.

If very small units get exemption then that is also not good for the future. Because then they will flood non-branded products into the market.

Manufacturers are also importing.

Import should be stopped immediately: Inderjit Singh Sohal

Plywood industry is a huge source of employment. One crore people including 15 lakh farmers and 15 lakh laborers are getting employment from it. Therefore imports should be stopped immediately.

Every unit should come under the preview of BIS. Otherwise, they will cheat the market by fake marking of BIS.

Question: What will happen to the finished goods lying in the market and warehouses?

Manoj Gwari: Whenever BIS sets any standard, information is gathered about the product what is lying in the market. There is no disecussion over it.

It takes time to set separate standards: CN Pandey

Utility grade should be included in 303, as preparing a separate standard may take time. It may not be ready within six months after completing its process afresh.

Competition from wood alike products: Manoj Gwari

CN Pandey exactly said that it is not easy to change any standard. This may take at least a year.

Products like HDMR and WPVC are replacing our product. Unknown quantity of wood in a product like WPVC is posing a challenge to our industry.

There are some products which have captured 40 percent of the market of various wood products, yet to be included in BIS.

No one can replace plywood: Ashok Tajpuria

Everything is running on auto mode. The standards will provide ease to consumers. Therefore QCO should be implemented.

As far as other products are concerned, everyone has their own market. Plywood has its own place. No one can take its place. The industry must believe in itself.

It is true that quality standards should be set for products similar to plywood also. Only then we can fulfill the interests of consumers.       

We should not have a harsh attitude towards medium and small industries. Take them along.

BIS is expected to work and take positive steps towards implementing the standards by cooperating with the industry.

Everyone should be taken along: Dr. MP Singh

Micro and small industries should also be taken care of, this is the right and good attitude. This is a new system, we should not put it in conflict with each other. Whatever decision is taken, it should be with the consent of everyone.

The reason for the delay in QCO is that we delayed in reaching a consensus. Everyone wants to implement QCO without delay, but care has to be taken that some unnecessary situation does not arise, which even BIS cannot resolve.

Plywood used for packaging may not be labeled as general use grade.

It should come in the notice of Govt. that various products alike plywood, are yet to be covered in QCO.

When the cost of your product will increase due to QCO, other similar products may take this place.

A memorandum should be given to the government regarding this subject.

BIS also needs to be attentive to this. Because if you bring one product within the quality standards, then it is not logical that another similar product is given a free hand.

This is like stopping one product and promoting another. There are many products which do not contain even ten percent wood.

Why should such product be sold in the name of wood? It should be kept separate identity from wood. Voice should be raised about this.

How can the rejected product be used or utilized? A discussion is necessary.

Quality standards of MDF are not fixed

We have not even been able to prepare ourselves for the quality control order under BIS.

Therefore, it is not enough to set standards, we also need to find out how the standards are implemented. AS 90% of the industries are out of BIS preview.

Now what will happen to the rejected product?

Large producers of MDF are also quite worried, because if there is 5-10 percent rejection, it may increase the production cost. Even BIS is unable to get a solutions yet. It would be better if it gets a marking of rejected grade.

Because if there is no grade then what will we do with the rejected goods? It will have to be destroyed. Which is a huge loss.

Question: Have there been any changes in the standards?

Dr. MP Singh: Some changes have been made in the plywood made for special use. BIS has incorporated the suggestions received from the industry.

The standards agreed upon should be published and implemented: Abhishek Chitlangia

The type of wood we are using as raw material, it is a difficult task to reach the standards set for 303 and 710. Stop marking is also a big issue.

We have reached the level where we can produce products as per the standards.

Long discussion over utility grade it is delaying the finalisation of BIS 303 standards.

We are moving forward in many things, regressing in some. I suggest that whatever has been decided should be implemented.

As far as the quality of imported goods is concerned, we should leave it to the consumers to decide. If a consumer does not get the value of the product then he will not go back to that product. We also have many factories which is producing low quality products. Why should we compete with them?

We should talk about quality. We are capable of providing quality products. We just need to take care of our market and our consumers. We cannot sale our products by stopping someone’s product.

We are ready to help all those industries who want to get license. If they need technical help, I will give them this help.

Six months have passed, yet all the units have not applied for license. Why? We should discuss it.

Suresh Bahety:

No law can be enforced unless there is a provision for penalty for disobeying it. Because we follow rules and regulations only under pressure.

License should be implemented immediately: Ashok Kumar Agarwall

If the plywood turns out to be defective, it takes a lot of time for the consumer to know about it. Mostly people depend and rely on carpenters.

Therefore, the QCO should be implemented. There should be a provision for fine and punishment.

What to do with the product which does not conform to the prescribed standards: Subhash Jolly

BIS should find a solution about the product which does not conform to the prescribed standards? Because only they have to take the initiative for this. Industrialists should also give their suggestions in this regard to BIS.

BIS is necessary for the development of the industry, but the problems and needs of the industrialists also have to be kept in mind. Only by striking a balance in this can we implement quality standards.

Lot of thanks to Dr. MP Singh, to guide Industrialist properly and in right direction.

Thanks to every panelist who have discussed the situation whole heartedly.

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