Lok Sabha Question No. 2074 (UNSTARRED), answered on 2018-01-01
Subject: Preference to Make in India
Ministry: COMMERCE AND INDUSTRY
Asked by: R. PARTHIPAN

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY DEPARTMENT OF INDUSTRIAL POLICY & PROMOTION

## LOK SABHA

UNSTARRED QUESTION NO. 2074.

TO BE ANSWERED ON MONDAY, THE 1 ST  JANUARY,  2018.

## PREFERENCE TO MAKE IN INDIA

## 2074.   SHRI R. PARTHIPAN:

Will the Minister of COMMERCE AND INDUSTRY be pleased to state:

वाणिज्य

## एवं उद्योग मंत्री

- (a) whether the Government has recently given its approval for a national procurement policy that gives preference to 'Make in India' in Government procurement and if so, the details thereof;
- (b) whether  this  aims  to  maintain  the  balance  between  promoting  'Make  in  India'  and ensuring time, quality and value for money products for the procuring  Government entities and if so, the details thereof; and
- (c) whether the new policy will boost domestic manufacturing and service provision and will enhance income and employment in the country and if so, the details thereof?

## ANSWER

## THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE & INDUSTRY

## वाणिज् यएवंउद्योग मंत्रालयमेंराज् यमंत्री(श्री सी.आर.चौधरी) (SHRI C.R. CHAUDHARY)

- (a) to (c): Yes  Madam.  The  'Public  Procurement  (Preference  to  Make  in  India)  Order, 2017'  dated  15 th June  2017  aims  to  promote  manufacturing  and  production  of goods and services in India with a view to enhance income and employment. The salient features of the Order are:
- i. Nodal  Ministries  have  been  identified  for  different  sectors/  goods  and services.
- ii. The  Order  is  applicable  on  procurement  of  both  goods  and  services  by  a Central  Ministry/  Department  or  their  attached/  subordinate  offices  or autonomous  bodies  controlled  by  the  Government  of  India,  including Government companies.
- iii. Wherever the estimated value of procurement is Rs. 50 lakhs or less, only local suppliers shall be eligible to participate in the procurement process.
- iv. Where the estimated value of procurement exceeds Rs. 50 lakhs, if a lowest bid (L1) is by a local supplier, then the entire contract will be awarded to L1. However, if the L1 bid is not from a local supplier, then the lowest bidder among the local suppliers will be invited to match the L1 price, provided his bid is within the margin of purchase preference of 20%. Accordingly, 50% of  the  Order  quantity  shall  be  procured  from  the  local  supplier(s)  if  the goods procured are divisible in nature. If the goods are not divisible or the services being procured are being valued on price alone, the entire contract shall be awarded to such local supplier subject to his matching the L1 price.
- v. Procurements  less  than  Rs.  5  lakhs  shall  not  be  required  to  follow  the process in this Order.
- vi. The minimum local content shall ordinarily be 50%, which can however be varied by the Nodal Ministry.
- vii. The local supplier shall have to provide self certification regarding meeting the criteria of minimum local content.

The  Order  provides  that  the  procuring  entities  shall  endeavour  to  see  that eligibility  conditions  in  tenders  such  as  turnover,  production  capability  and financial  strength  should  not  result  in  unreasonable  exclusion  of  local  suppliers beyond what is essential for ensuring quality and credit worthiness of the supplier. Thus, it maintains the necessary balance, both in terms of quality as also lowest cost to the procuring entity.

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