diff --git a/pkg/neg/readiness/poller.go b/pkg/neg/readiness/poller.go
index 509e88b112..b901f658a3 100644
--- a/pkg/neg/readiness/poller.go
+++ b/pkg/neg/readiness/poller.go
@@ -162,14 +162,18 @@ func (p *poller) Poll(key negMeta) (retry bool, err error) {
 	// TODO(freehan): filter the NEs that are in interest once the API supports it
 	res, err := p.negCloud.ListNetworkEndpoints(key.Name, key.Zone /*showHealthStatus*/, true, key.SyncerKey.GetAPIVersion())
 	if err != nil {
-		// On receiving GCE API error, do not retry immediately. This is to prevent the reflector to overwhelm the GCE NEG API when
-		// rate limiting is in effect. This will prevent readiness reflector to overwhelm the GCE NEG API and cause NEG syncers to backoff.
-		// This will effectively batch NEG health status updates for 100s. The pods added into NEG in this 100s will not be marked ready
-		// until the next status poll is executed. However, the pods are not marked as Ready and still passes the LB health check will
-		// serve LB traffic. The side effect during the delay period is the workload (depending on rollout strategy) might slow down rollout.
-		// TODO(freehan): enable exponential backoff.
-		p.logger.Error(err, "Failed to ListNetworkEndpoint in NEG. Retrying after some time.", "neg", key.String(), "retryDelay", retryDelay.String())
-		<-p.clock.After(retryDelay)
+		if negtypes.IsStrategyQuotaError(err) {
+			p.logger.V(4).Error(err, "Failed to ListNetworkEndpoints in NEG", "neg", key.String())
+		} else {
+			// On receiving GCE API error, do not retry immediately. This is to prevent the reflector to overwhelm the GCE NEG API when
+			// rate limiting is in effect. This will prevent readiness reflector to overwhelm the GCE NEG API and cause NEG syncers to backoff.
+			// This will effectively batch NEG health status updates for 100s. The pods added into NEG in this 100s will not be marked ready
+			// until the next status poll is executed. However, the pods are not marked as Ready and still passes the LB health check will
+			// serve LB traffic. The side effect during the delay period is the workload (depending on rollout strategy) might slow down rollout.
+			// TODO(freehan): enable exponential backoff.
+			p.logger.Error(err, "Failed to ListNetworkEndpoints in NEG. Retrying after some time.", "neg", key.String(), "retryDelay", retryDelay.String())
+			<-p.clock.After(retryDelay)
+		}
 		return true, err
 	}
 
diff --git a/pkg/neg/syncers/syncer.go b/pkg/neg/syncers/syncer.go
index 964fd85519..5169572bcc 100644
--- a/pkg/neg/syncers/syncer.go
+++ b/pkg/neg/syncers/syncer.go
@@ -92,7 +92,10 @@ func (s *syncer) Start() error {
 			err := s.core.sync()
 			if err != nil {
 				metrics.PublishNegControllerErrorCountMetrics(err, false)
-				delay, retryErr := s.backoff.NextDelay()
+				delay, retryErr := time.Duration(0), error(nil)
+				if !negtypes.IsStrategyQuotaError(err) {
+					delay, retryErr = s.backoff.NextDelay()
+				}
 				retryMsg := ""
 				if retryErr == backoff.ErrRetriesExceeded {
 					retryMsg = "(will not retry)"
diff --git a/pkg/neg/syncers/transaction.go b/pkg/neg/syncers/transaction.go
index 5dc4b5e9eb..4287142973 100644
--- a/pkg/neg/syncers/transaction.go
+++ b/pkg/neg/syncers/transaction.go
@@ -251,7 +251,7 @@ func (s *transactionSyncer) syncInternalImpl() error {
 
 	currentMap, currentPodLabelMap, err := retrieveExistingZoneNetworkEndpointMap(s.NegSyncerKey.NegName, s.zoneGetter, s.cloud, s.NegSyncerKey.GetAPIVersion(), s.endpointsCalculator.Mode(), s.enableDualStackNEG)
 	if err != nil {
-		return fmt.Errorf("%w: %v", negtypes.ErrCurrentNegEPNotFound, err)
+		return fmt.Errorf("%w: %w", negtypes.ErrCurrentNegEPNotFound, err)
 	}
 	s.logStats(currentMap, "current NEG endpoints")
 
@@ -594,9 +594,13 @@ func (s *transactionSyncer) commitTransaction(err error, networkEndpointMap map[
 	}
 
 	if needRetry {
-		if retryErr := s.retry.Retry(); retryErr != nil {
-			s.recordEvent(apiv1.EventTypeWarning, "RetryFailed", fmt.Sprintf("Failed to retry NEG sync for %q: %v", s.NegSyncerKey.String(), retryErr))
-			metrics.PublishNegControllerErrorCountMetrics(retryErr, false)
+		if negtypes.IsStrategyQuotaError(err) {
+			s.syncer.Sync()
+		} else {
+			if retryErr := s.retry.Retry(); retryErr != nil {
+				s.recordEvent(apiv1.EventTypeWarning, "RetryFailed", fmt.Sprintf("Failed to retry NEG sync for %q: %v", s.NegSyncerKey.String(), retryErr))
+				metrics.PublishNegControllerErrorCountMetrics(retryErr, false)
+			}
 		}
 		return
 	}