Govt mulling task force to help MSEs with procurement policy

The MSME ministry plans to set up a task force to help micro and small enterprises take advantage of the new procurement policy being framed by the government.

The MSME ministry plans to set up a task force to help micro and small enterprises take advantage of the new procurement policy being framed by the government.

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"We are thinking of setting up a task force on procurement to understand the actual capacity of MSEs, identify products required by various government departments and ways to help them take advantage of the new policy being framed," a senior ministry official said.

According to the procurement policy, which is awaiting Cabinet approval, 20% of the annual purchases by various ministries and public sector enterprises will be sourced from MSEs.

The task force, the official said, will suggest steps to help the micro and small enterprises (MSEs) improve their operational performance and step up production of goods with a view to meeting the demand of state-run firms.

The government, the official said, will soon circulate a Cabinet Note on the procurement policy.

This policy is a part of the recommendations by a Task Force set up by Prime Minister Manmohan Singh that went into the whole gamut of problems faced by the micro, small and medium enterprises (MSME) sector.

Last week, minister for Heavy Industries and Public Enterprises Praful Patel said in Parliament: "The (proposed) policy on procurement by Public Sector Undertakings (PSUs) through Micro, Small and Medium Enterprises is under consideration of the government."

The sector contributes 40% to the country's total exports and 45% of the manufacturing output. There are 26 million MSME units in the country, which employ 60 million people.