Proposal on procurement from MSEs awaits Cabinet approval

The proposed policy for compulsory government procurement from micro and small enterprises (MSEs) is under process for approval of the Cabinet, the government said today.

Under the proposed scheme, it would be mandatory for the government departments and public sector units to buy 20% of their requirement from Micro, Small and Medium Enterprises (MSMEs).

"For boosting the growth and contribution of MSME, the government is planning to introduce a public procurement policy for goods produced and services rendered by MSEs by central ministries/departments/PSUs, which is under process for approval of Cabinet," MSME Minister Virbhadra Singh said
in a written reply to the Rajya Sabha.

Further, he said that out of 20% target of annual procurement from MSEs, a sub target of 4% (i.e. 20% of 20%) is proposed to be earmarked for
procurement from MSEs owned by Scheduled Castes/Scheduled Tribe entrepreneurs.

The government is implementing various schemes/programmes for the promotion and development of MSMEs. The major schemes include Credit Guarantee Scheme, Credit Linked Capital Subsidy Scheme and Performance and Credit Rating Scheme, Singh said.