The recycling industry is calling for the scrapping of the mandatory Pre-Shipment Inspection Certificate (PSIC) requirement for scrap and recyclable materials, arguing that the overseas inspection regime is impractical at the scale of India’s recycling trade and is creating unnecessary costs, delays and uncertainty for legitimate importers. 

The demand predates the latest changes introduced by the Directorate General of Foreign Trade (DGFT). Industry stakeholders have been raising concerns around PSIC compliance, inspection, documentation, verification and customs clearance. The subsequent changes introduced by DGFT on August 25, 2026, have intensified these concerns.

Speaking to Waste & Recycling, Ehsan Gadawala, Chairman of Ala Group, said the industry is seeking a permanent alternative to overseas PSIC inspections. “We are asking DGFT to eliminate the PSIC” requirement for metal and paper scrap, Gadawala said, arguing that India should instead conduct inspection and scanning at its own ports.

A question of scale

Gadawala’s central argument is that the present system cannot realistically support the scale and geographical spread of India’s scrap trade.

He cited an industry estimate of 2,300–2,500 containers of metal scrap arriving in India every day, translating to more than 625,000 containers a year. At an average load of around 20 tonnes, this represents approximately 13 million tonnes of metal scrap annually.

Requiring physical inspection before shipment across thousands of loading locations in different countries creates a significant logistical burden. An inspection agency may have to cover multiple cities and countries, while suppliers must also comply with increasingly detailed documentation and uploading requirements.

An alternative approach would be to shift inspection to India. Gadawala pointed to the availability of scanners and other equipment at more than 13 Indian ports, arguing that consignments can be examined upon arrival, supported by appropriate undertakings from importers and controls on sourcing.

Such a system could reduce foreign-exchange expenditure associated with overseas inspections while allowing Indian authorities to retain direct control over inspection and radiation monitoring.

From policy concern to supply-chain disruption 

The concerns surrounding PSIC have since been compounded by the implementation of DGFT’s Trade Notice No. 22/2026-27, issued on August 25, 2026, which introduced enhancements to the PSIA/PSIC process.

DGFT’s subsequent September 16, 2026, notification acknowledged implementation difficulties, providing a one-time seven-day window for recognised PSIAs to clear backlog PSICs relating to inspections conducted before August 25, 2026, where certificates could not be issued because of the system restrictions introduced by the August 25 notice.

The September 16 notice also revised the issuance timeline, allowing a PSIC to be generated and issued within two days of inspection, with uploading to take place from the same geographical location or country where the inspection was conducted.

Gadawala said delays in obtaining PSICs are contributing to port congestion and supply-chain disruption, while the additional compliance burden is putting pressure on both small and large recycling companies.

He said some overseas suppliers have informed Indian buyers that they are no longer willing to ship cargo to India because of the uncertainty surrounding the certification process.

“This is the supply chain of the small industries, big industries, literally going into havoc,” he said. 

The situation could also affect the more than 25,000 recycling MSMEs that depend on a reliable supply of ferrous and non-ferrous recyclable raw materials. The industry is therefore seeking a more practical inspection framework that maintains safeguards against hazardous or non-compliant consignments while reducing procedural delays, duplication and costs associated with mandatory overseas inspection.