Inside the Export NOC Crisis: What Indian Exporters Need to Know in 2025

Inside the Export NOC Crisis: What Indian Exporters Need to know in 2025

The newly implemented Export No Objection Certificate (NOC) system in India has sparked significant debate among exporters, particularly in the pharmaceutical sector. Introduced by the Central Drugs Standard Control Organization (CDSCO) on March 7, 2025, the system aims to streamline processes but has also introduced challenges that could hinder export growth.

Key Features of the New Export NOC System

The revamped Export NOC system incorporates several changes aimed at simplifying compliance but has also raised concerns.  One-Year NOC Validity: The new system replaces consignment-specific NOCs with a one-year validity period. While this reduces administrative burden, exporters argue that the one-year limit is impractical for products requiring longer registration timelines in importing countries.  One-Time Registration Process: Exporters must complete an Integrated Registration Form (IRF) on the Sugam portal, which will be verified by CDSCO before issuing the NOC.  Mandatory Documentation: The application requires a legal undertaking from manufacturers, manufacturing licenses, reconciliation details, and approval status from importing countries. Dynamic documents must also be submitted during port clearance.

Challenges Faced by Exporters

While the revamped Export NOC system aims to simplify compliance, it has brought with it a host of practical challenges. The one-year validity period for NOCs is proving problematic, especially since product registration and licensing in many importing countries can take 18–24 months. This mismatch risks reducing the export of registered products. Further, the mandate to destroy stock with less than 60% shelf life is causing significant financial losses and adding complexity to inventory management particularly for exporters who maintain buffer stock for staggered shipments. The requirement for legal undertakings from API manufacturers is another major hurdle, as nearly 70% of APIs used by Indian exporters are procured from third-party suppliers, making coordination difficult. Markets such as Africa and Latin America, which collectively account for nearly 25% of India’s pharma exports, could see disruptions due to the new rules potentially jeopardizing over ₹6,350 crore in annual exports. Exporters are also facing delays of 30-45 days due to added documentation requirements, contributing to estimated foreign exchange losses of ₹500 crore annually. With India exporting $25.4 billion worth of pharmaceutical products in FY 2023-24, experts warn that the new regulations could lead to a 5–10% decline in exports in FY 2025–26 a potential setback of $1.27–$2.54 billion.

Implications for India's Pharmaceutical Exports

India’s pharmaceutical sector is a significant contributor to its export economy. However, these new regulations could have far-reaching consequences. These stringent requirements may prompt global buyers to seek alternative suppliers with less restrictive policies. Competitor nations like China and Vietnam, which have more flexible export regulations, are projected to capture up to 10% of India’s market share, resulting in an annual loss of approximately ₹2,540 crore for Indian exporters. The one-year validity of the regulations and the documentation bottlenecks could lead to a decline in exports of registered products, particularly in Rest of the World (ROW) markets where formal approvals are not always mandatory. Countries with more lenient regulatory frameworks may attract businesses away from India, potentially impacting its position as a global pharmaceutical hub.

Opportunities Amid Challenges

While the new system presents challenges, it also presents opportunities for growth. By streamlining the processes for compliant exporters, the one-time registration and one-year validity reduce repetitive paperwork and expedite approvals. Exporters should focus on quality; by enforcing stricter compliance measures, India can enhance its reputation as a reliable supplier of high-quality pharmaceuticals.

How Technology Can Help: TradeVeda by Liquidmind® AIIn response to these regulatory complexities, platforms like TradeVeda by Liquidmind® AI are emerging as essential tools for exporters. TradeVeda is an AI-powered export compliance automation platform designed specifically to handle evolving documentation requirements, NOC tracking, and multi-country regulatory workflows.

With features such as:

• Automated NOC Validity Tracking and Alerts

• Real-time document verification and validation (BoL, IRF, CoAs, FSCs, etc.)

• API integration with CDSCO’s Sugam Portal

• One-click audit trails for faster inspections

• Support for multi-country documentation compliance (Africa, LATAM, EU, etc.)

TradeVeda ensures exporters can reduce delays, avoid penalties, and stay compliant without overburdening their teams with manual tasks.

Conclusion

The new Export NOC system represents both a challenge and an opportunity for Indian exporters. While it aims to simplify processes and enhance compliance, its stringent requirements could disrupt trade dynamics if not addressed collaboratively. By adapting strategies and working closely with regulators, Indian exporters can mitigate risks and leverage this transition to strengthen their global standing.

As the pharmaceutical export landscape evolves, staying ahead of compliance requirements is no longer optional; it's essential. TradeVeda by Liquidmind® AI is built to help Indian exporters tackle the very challenges this new NOC system presents. From automating documentation workflows and tracking NOC validity, to integrating real-time regulatory updates and managing API compliance, TradeVeda is your intelligent compliance companion.

Authored By~ Mr. Aniruddha Wankhade