PSUs may have to make 20% buys from small units

Introducing reservations for disadvantaged sect- ions in its Draft Procurement Preference Policy...

Introducing reservations for disadvantaged sect- ions in its Draft Procurement Preference Policy, the micro small and medium enterprises ministry has fixed a minimum ceiling for micro and small enterprise procurement from SC/ST and women entrepreneurs at 22.5 and 10 per cent respectively.

The draft proposal specifies that Central government ministries, departments, aided institutions and PSUs under it must procure at least 20 per cent of the value of their total annual purchases from MSEs for the products produced and provided by such enterprises or National Small Industries Corporation (NSIC) as supplier. This decision was taken at the second national board meet of all the stakeholders today.

The meeting also suggested adoption of uniform tendering norms across government departments to avoid hidden costs. It pointed to the irregularities in various purchasing departments of public sector that allow additional barriers in form of performance guarantee deposit, technical specifications and minimum turnover requirements.

While acknowledging these barriers as unnecessary conditions to be dispensed with, commerce ministry sought clarification on the term ‘managed by disadvantaged groups’ as it may lead to abuse of incentives doled out to this section. The various MSE associations present at the meeting also emphasised the necessity of maintaining compliance records with respect to the purchases made by the concerned government departments from this sector.