The public procurement market in India holds significant potential and has strategic importance for the growth of overall economy, including the MSME sector.
The public procurement market in India holds significant potential and has strategic importance for the growth of overall economy, including the MSME sector. The Public Procurement policy for MSE 2012 mandates 20 per cent procurement of goods and services from MSEs by all central ministries, departments and central public sector enterprises (CPSEs) from FY 2015. But achieving this target is not going to be an easy task for all the stakeholders involved.
To address the challenges faced by the MSMEs, the CII on June 3 organised a SME Policy Roundtable on Public Procurement Policy in New Delhi. The main agenda was to discuss and deliberate on the ways to effectively utilise this policy for the mutual development and growth of the MSMEs and the Public Sector Enterprises.
MSMEs, being small and constrained in managerial capacity, face problems of information asymmetry, complex vendor registration process, short tender notice period, disproportionate qualification criteria and certification requirements while accessing the public procurement market. CPSEs too face issues like identifying and engaging with suppliers in the MSME space. Looking at the current status, there’s an urgent need to put a proper system and processes in place for achieving targets since many CPSEs are yet to start procuring from MSMEs.
The Office of DC MSME, Ministry of MSME and GIZ who jointly implement the MSME Umbrella Programme (MSME-UP), have initiated a step in this regard by offering technical support for the effective implementation of the Public Procurement Policy for. Speaking at the conference, Neha Nagpal, Techncal Expert, GIZ said, “The MSME-UP programme has conducted several consultation workshops across the country and has been regularly interacting with various CPSEs, Central Ministries and MSEs to better understand the challenges faced or likely to be faced by them. Moreover, an extensive research on domestic and international best practices has also been conducted to ensure effective implementation of public procurement policy for MSMEs.”