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New law to tackle corruption

Rocked by the recent spate of scams, the government will come out with a comprehensive public procurement law to clearly demarcate powers and responsibilities of various authorities and ensure full transparency to reduce corruption. Gaurav Choudhury reports.

business Updated: Feb 13, 2011 21:21 IST
Gaurav Choudhury

Rocked by the recent spate of scams, the government will come out with a comprehensive public procurement law to clearly demarcate powers and responsibilities of various authorities and ensure full transparency to reduce corruption.

The cabinet secretary has set up a special committee headed by former Competition Commission of India (CCI) chairman Vinod Dhall to give recommendations on the same.

“We expect to finalise the recommendations by the end of this month,” Dhall told HT.

The committee will formulate a comprehensive public procurement policy and a legal and institutional framework incorporating strong punitive measures to act as deterrents for the misuse of discretionary powers.

Public procurement includes government contracts for supplies of goods, civil work such as roads, ports and airports, and consultancies among others.

The annual government expenditure on public procurement is pegged at R2.5-R3 lakh crore.

“The move is aimed at ensuring full transparency in public procurement that accounts for about 25% of the total government expenditure,” Dhall said.

Dhall did not give out details about the contours of the proposed legislation.

The legislation will be a “substantive law” that would eventually replace the General Financial Rules, which currently serves as the guideline for government purchases and contracts, a source said.