Government on Tuesday said that only 32 out of 146 public sector undertakings (PSUs) have complied with the mandatory 20 per cent procurement of products and services required by them from micro and small enterprises till now.
Minister for Micro Small and Medium Enterprises (MSME) Kalraj Mishra told media persons during a press conference to highlight achievements of his department during the first 100 days of the NDA Government, that the Centre plans to amend the public procurement policy to incorporate provisions against PSUs who fail to meet the mandatory at least 20 per cent procurement by April 2015.
"As far as procurement policy is concerned, it is true that several PSUs are not complying with the required procurement. Only 32 PSUs have complied with the 20 per cent mandatory procurement out of 146 PSUs," Mishra said.
He added that according to the policy, (20 per cent procurement will be mandatory from April 2015. "We are thinking of amending the policy to incorporate provisions against PSUs who do not comply with the mandatory procurement norm after April, 2015," said the minister.
All PSUs, Central Government ministries and departments will have to procure at least 20 per cent of products and services required by them from micro and small enterprises (MSEs) from April next year.
The public procurement policy for micro and small enterprises had become effective from April 1, 2012. However, the provision of 20 per cent procurement of products produced and services rendered by MSEs will be mandatory from 1 April 2015 for central ministries/departments/PSUs.
According to data available with the MSME ministry, procurement of approximately Rs 14,442 crore, Rs 12,931 crore and Rs 3,799 crore was made from MSEs by central ministries/departments/PSUs in 2011-12, 2012-13 and 2013-14, respectively. This shows a steep decline in procurement from MSEs by them in the last fiscal as compared to the preceding two years.
MSME sector contributes 8 per cent of GDP and accounts for around 40 per cent of the total exports and around 45 per cent of the manufacturing output.
As per the Fourth All India Census of the Micro, Small and Medium Enterprises, total number of Enterprises of the MSME sector is 361.76 lakh of which 15.64 are registered Enterprises. The sector provides employment to 805.24 lakh persons. MSME sector is the largest job provider after agriculture sector.