Ministry of Micro,Small & Medium Enterprises08-November, 2011 17:02 IST
Public Procurement Policy for Micro and Small Enterprises: A Perspective
BACKGROUNDER
The Micro and Small Enterprises (MSEs) constitute an overwhelming
majority of this sector, contributing significantly to the gross
domestic product, manufacturing output, exports and employment
generation. Among registered MSEs, 10.73% are owned by SC/ ST
entrepreneurs, 38.7% by OBCs and 13% by Women entrepreneurs (as per
IVth Census of MSMEs).
MSEs are highly susceptible to volatile market conditions. To address
this inherent problem, many countries in the advanced world have put
in place public procurement policies to support MSEs and to ensure a
fair share of market to such entities, for example, in USA, a minimum
of 23% from Small Businesses is legislated. Under the existing
dispensation in India, the Government guidelines provide for support
in marketing of MSE products through a variety of measures such as
price preference, reservation of products for exclusive purchase from
MSEs, issue of tender sets free of cost, exemption from payment of
earnest money, etc. In practice, however, these guidelines are not
being followed many Government Departments/ CPSUs, etc in true spirit.
Therefore, there was a need for an effective policy which mandates the
Central Govt. Deptt. /CPSUs to procure necessarily from MSEs.
Ministry of MSME has formulated Public Procurement Policy for MSEs
which has been approved by the Cabinet.
The Salient features of the Public Procurement Policy are as under:
Every Central Ministry/Department/PSU shall set procurement goal
of minimum 20 per cent of the total annual purchases of the products
or services produced or rendered by MSEs.
Out of 20% target of annual procurement from MSEs, a sub-target of
4% (i.e., 20% out of 20%) will be earmarked for procurement from MSEs
owned by SC/ST entrepreneurs.
The overall target of 20% is proposed to be made mandatory at the
end of 3 years.
For enhancing the participation of SCs/STs in the Government
procurement, the Central Government Ministry/Department/PSUs will
organise special Vendor Development Programmes, Buyer-Seller Meets
etc.
Every Central Government Ministry/Department/PSU will report the
goals set with respect to procurement to be met from MSEs and the
achievement made thereto in their Annual Reports.
The MSEs participating in a tender quoting price within the band
of L1+15% may also be allowed to supply at L1 price where L1 price is
from someone other than an MSE. Such MSEs may be allowed to supply up
to 20% of the total tendered value. In case of more than one such
MSEs, the supply will be shared equally.
The Central Ministry/Department/Public Sector Undertaking will
continue to procure 358 items from MSEs, which have been reserved for
exclusive purchase from them.
Given their unique nature, defence armament imports will not be
included in computing the 20% goal for M/o Defence. In addition,
Defence Equipments like weapon systems, missiles, etc. will remain out
of purview of such policy of reservation.
A Review Committee has been constituted under the chairmanship of
Secretary (MSME) for monitoring and review of the Public Procurement
Policy for MSEs. In addition, a 'Grievance Cell' would be set up in
the Ministry of MSME for redressing the grievances of MSEs in
Government procurement.
The policy will help to promote MSEs by improving their market access
and competitiveness through increased participation by MSEs in
Government purchases and encouraging linkages between MSEs and large
enterprises.
A Broader Outlook:
Given the present global situation of an impending or even
continuing economic slowdown, creating demand within our own vast
market for products produced by our own industries, would be a good
buffer to ward off the negative impact. With assured public
procurement, the MSE sector has only itself as a competitor among its
vast variety of products. It will not only encourage better marketing
strategies but also an incentive for new designs and technologies so
that their produce can compete even in international markets. This
will also have a stabilizing effect on market fluctuations of demand
and supply and liquidity crisis. With MSEs great employment
generation potential, the new procurement policy will be a boost to
keep generating new products with mostly locally available resources
both in material and manpower. Thus with a substantial section of
national economy in good spirits, government will have its hands
strengthened to chalked out policies to deal with the impact of global
economic crisis.
*****
------------------------------------
----
INFORMATION OVERLOAD?
Get all ZESTCaste mails sent out in a span of 24 hours in a single mail. Subscribe to the daily digest version by sending a blank mail to ZESTMedia-digest@yahoogroups.com, OR, if you have a Yahoo! Id, change your settings at http://groups.yahoo.com/group/ZESTMedia/join/
PARTICIPATE:-
On this list you can share caste news, discuss caste issues and network with like-minded anti-caste people from across India and the world. Just write to zestcaste@yahoogroups.com
TELL FRIENDS TO SIGN UP:-
If you got this mail as a forward, subscribe to ZESTCaste by sending a blank mail to ZESTCaste-subscribe@yahoogroups.com OR, if you have a Yahoo! ID, by visiting http://groups.yahoo.com/group/ZESTCaste/join/
Also have a look at our sister list, ZESTMedia: http://groups.yahoo.com/group/ZESTMedia/Yahoo! Groups Links
<*> To visit your group on the web, go to:
http://groups.yahoo.com/group/ZESTCaste/
<*> Your email settings:
Individual Email | Traditional
<*> To change settings online go to:
http://groups.yahoo.com/group/ZESTCaste/join
(Yahoo! ID required)
<*> To change settings via email:
ZESTCaste-digest@yahoogroups.com
ZESTCaste-fullfeatured@yahoogroups.com
<*> To unsubscribe from this group, send an email to:
ZESTCaste-unsubscribe@yahoogroups.com
<*> Your use of Yahoo! Groups is subject to:
http://docs.yahoo.com/info/terms/
No comments:
Post a Comment