In India, the quota system for refrigerant gases is a strict regulatory framework managed by the Ozone Cell under the Ministry of Environment, Forest and Climate Change (MoEFCC). Its core objective is to fulfil India’s commitments under international environmental treaties—specifically the Montreal Protocol and the Kigali Amendment—by gradually phasing down the production and consumption of environmentally harmful chemical refrigerants
India has a fully functional, legally enforced production quota system for Hydrochlorofluorocarbons (HCFCs) like R-22
- The Rule: No domestic chemical manufacturer can produce R-22 for non-feedstock (cooling) purposes without an explicit Quota License issued by the Ozone Cell.
- Allocation Method: The government establishes a country-wide cap each year. This total volume is apportioned to eligible domestic manufacturing enterprises based on their historical production levels during the 2009–2010 baseline period.
- Phase-out Target: From January 1, 2025, the use of HCFCs in manufacturing all new equipment is entirely prohibited. The remaining annual quota is strictly restricted to servicing existing legacy cooling systems until a complete phase-out by 2030 (with a minimal 2.5% service tail allowed until 2040).
How it Impacts the Industry
- Market Race: Indian chemical manufacturers (like SRF, Gujarat Fluorochemicals, etc.) are prioritizing optimum capacity utilization to maximize their market share during the baseline monitoring period, ensuring they receive the largest possible individual quota allocations after 2027.
- Licensing Requirements: The Directorate General of Foreign Trade (DGFT) and the Ozone Cell have already mandated a strict import/export licensing system for all HFCs and HFC-blends to prevent illegal market placement.
- Transition Pressure: Because quotas restrict supply, the cooling industry is being fast-tracked to adopt zero-ODP and ultra-low-GWP alternatives, such as Hydrofluoroolefins (HFOs) and natural refrigerants
