DGFT Delists Scrap Inspection Agencies and Tightens PSIC Timelines: Metal Scrap Importers Face Clearance Disruption

If you import unshredded metallic scrap into India, check right now whether the pre-shipment inspection agency (PSIA) you use is still recognised, and whether your pre-shipment inspection certificates (PSICs) are being uploaded within the new, tighter window. The Directorate General of Foreign Trade (DGFT) has withdrawn recognition from a number of PSIAs and compressed PSIC timelines, and importers are already reporting rejected certificates and penalties at ports such as Mundra.

What Happened

Two connected changes have hit scrap importers in September 2026.

First, DGFT has withdrawn recognition from about 15 pre-shipment inspection agencies, reported around 25 September 2026. The reason given is that these agencies had not followed the prescribed inspection and certification procedure — in particular, issuing a large number of PSICs "from a single instrument across countries" without adequate due diligence. Certificates issued by a delisted agency are being rejected at customs clearance.

Second, DGFT has tightened the PSIC issuance and upload timeline. Following an earlier trade notice (reported dated around 25 August 2026) that required near-same-day issuance, the timeline has been set to a 2-day window, with a one-time 7-day relaxation granted to help clear the backlog of pending PSICs. Cargoes whose certificates are not uploaded within the window are being penalised.

Why / Background

A PSIC from a DGFT-recognised PSIA is mandatory for importing unshredded, compressed or loose metallic scrap into India — a safeguard designed to keep explosives, radioactive material, arms and other hazardous contaminants out of scrap consignments. India imports roughly 13 million tonnes of metal scrap a year, and PSIAs reportedly handle on the order of 2,500 containers a day worldwide. When recognition is withdrawn or timelines tighten, the effect on the supply chain is immediate.

DGFT's crackdown follows concerns about the integrity of certificates issued without proper physical inspection. The Material Recycling Association of India has argued that port-based radiation scanning could reduce dependence on overseas inspection and save significant foreign exchange, but for now the PSIA-and-PSIC regime remains the gate for scrap imports.

Who's Affected

Importers and recyclers of ferrous scrap (Chapter 72), copper scrap (Chapter 74) and aluminium scrap (Chapter 76); traders sourcing scrap from multiple origins; and customs house agents clearing scrap consignments. One recycling company is reported to have paid penalties on 15 cargoes because of certificate and upload-timing issues.

Operational Detail

The two immediate failure points are (1) a certificate issued by an agency that has since been delisted, which will be rejected at clearance, and (2) a valid certificate that misses the upload window, which triggers penalties. Cargo already at sea when an agency is delisted, or when a deadline passes, is especially exposed because the certificate cannot be re-issued retrospectively by a compliant route.

What Importers and CHAs Should Do Now

• Verify, before every shipment, that your chosen PSIA is currently on DGFT's recognised list — do not assume continuity.
• For cargo already booked or in transit against a now-delisted agency, contact your CHA and the destination customs immediately to assess options and avoid a rejected clearance.
• Build the 2-day PSIC upload window into your process, with a named person responsible for timely upload on ICEGATE/DGFT systems.
• Use the one-time 7-day backlog relaxation to regularise any pending PSICs before it lapses.
• Keep documentary proof of inspection and upload timestamps to contest penalties where the delay was outside your control.

The Bigger Picture

This is a compliance-integrity drive, not a one-off. Expect DGFT to keep policing PSIA conduct and to keep timelines tight. Importers who concentrate risk on a single inspection agency or leave uploads to the last moment are the most exposed. Diversifying across recognised agencies and hardening internal upload discipline is the durable fix.

Frequently Asked Questions

Is a PSIC still mandatory for scrap imports? Yes. For unshredded metallic scrap, a PSIC from a DGFT-recognised PSIA remains mandatory. Nothing here removes that requirement — it tightens who can issue certificates and how quickly they must be uploaded.

What happens if my agency was delisted after it issued my certificate? Certificates from delisted agencies are being rejected at clearance. Engage your CHA and customs at once; you may face re-inspection, delay or additional cost.

What is the 7-day relaxation? A one-time window to upload backlog PSICs that were pending under the tighter timeline. Use it promptly — it is not a permanent extension.

Which scrap is covered? Unshredded/compressed/loose metallic scrap across ferrous and non-ferrous categories. Shredded scrap and metals in other forms may follow different rules — check your specific ITC(HS) line.

Conclusion

The combination of delisted agencies and a 2-day upload window means a certificate that was fine last month can fail at the port today. Confirm your PSIA's current recognition status before shipping, own the upload deadline internally, and clear any backlog under the 7-day relaxation while it lasts.

This is an operational alert for general guidance. Verify the current list of recognised PSIAs, the exact timelines and any relaxation against the official DGFT portal (dgft.gov.in) and the relevant trade notice before acting.