Small firms to get quota in govt buys

For 28-year old engineering graduate Venkat Raju, his scheduled caste status won’t be a deterrent factor in setting up a manufacturing unit of his own in his home town Vizianagaram. That is what he thinks after the new public procurement policy for the micro and small enterprises (MSEs) has come into force from April 1. Debobrat Ghose reports.

For 28-year old engineering graduate Venkat Raju, his scheduled caste status won’t be a deterrent factor in setting up a manufacturing unit of his own in his home town Vizianagaram. That is what he thinks after the new public procurement policy for the micro and small enterprises (MSEs) has come into force from April 1.

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The policy ensures 20% reservation for the MSEs in the purchases made by the central government, departments and public sector undertakings (PSUs).

The policy has a special provision that out of 20% annual procurement target, 4% of the 20% shall be procured from scheduled caste (SC) and scheduled tribe (ST) entrepreneurs.

"SC & ST candidates instead of depending on government jobs can now take to entrepreneurship, as the policy is likely to provide an ensured market," said Raju.

“Policy is good and its implementation needs to be equally effective. An institutional mechanism ought to be in place, to ensure compliance by different agencies, to redress grievances and to consider issues such as exemptions,” president, Federation of Indian Micro & Small and Medium Enterprises (FISME), VK Agarwal, said.

Prime Minister’s Taskforce estimated annual central government (& PSUs) procurement over Rs 170,000 crore, out of which MSEs’ share was found to be around 4-5% only. A FISME study shows that 20% set-aside opens up an additional window of an annual market of Rs 25,000 crore for the MSEs.