Rajesh Rai | Phuentsholing

Export of ferrosilicon from the country has come to a halt since October 24 with the expiry of the Bureau of Indian Standards (BIS) certification on October 23.

India’s Ministry of Steel made it mandatory for steel manufacturers to produce BIS certification in 2020. The BIS team from India couldn’t come for an inspection of the ferrosilicon factories in the country due to the pandemic.

“We have been exporting till date with the extensions, which have now expired,” an official with one of the firms said.

So far, India’s Ministry of Steel has allowed five extensions. The last extension expired on October 23.

According to sources, BIS officials were expected to visit the ferro industry in October this year. However, it was learned that the officials would be able to visit and conduct inspections only after the end of this month considering the festive season in India.

Economic affairs minister Loknath Sharma said they were already anticipating the issue and that the Department of Trade (DoT) on September 28 took up the matter and sent official correspondence to the Ministry of Foreign Affairs (MoFA) seeking a further extension of six months.

“The MoFA through a note verbale (NV) then took up the matter with the Indian Embassy on October 10, 2022,” he said.

“The DoT while constantly following up through various channels on the certification for ferrosilicon exports, was made aware that the BIS officials would not be able to visit Bhutan and complete the certification process due to the long holiday season in India.”   

Meanwhile, the matter has reached relevant offices in New Delhi, India and it is under consideration. Lyonpo said the BIS office has already recommended the extension to the Ministry of Steel, India. The ministry is expected to issue an extension soon.

Bhutan’s trade attache in Delhi is also following up regularly on the matter with her counterparts in the Government of India.

While expecting another extension, Lyonpo Loknath Sharma said industrialists also have to make their factories ready for certification as such exemption continuity is not predictable.

“The onus lies on our industries too to get certified,” he said.

Ferrosilicon is the highest exported commodity from Bhutan today contributing to the government in taxes. The government could be losing millions in taxes as it is already a week now without export.

In 2021, ferrosilicon was the top exported commodity. Bhutan exported ferrosilicon worth Nu 15 billion (B), according to the Bhutan Trade Statistics (BTS). In 2020, Bhutan exported ferrosilicon worth Nu 7B.

In the first and second quarter this year, BTS shows Bhutan exported ferrosilicon worth Nu 4.8B and Nu 4B respectively.

There are nine ferrosilicon firms in the country today. Few more are underway.