Government orders ‘priority’ for local tenders

Ministries not allowed to seek nod for global tenders for contracts worth up to ₹200 crore

The government has tightened its procurement norms to make it tougher for Ministries to pursue global tenders for contracts worth up to ₹200 crore.

Under the Atma Nirbhar Bharat Abhiyan announced in May, the government had barred departments from issuing global tenders for contracts worth ₹200 crore or less.

The General Financial Rules were amended to disallow global tender enquiries in such procurement of goods and services, with an eye on boosting the prospects of domestic micro, small and medium enterprises. Any Ministry seeking an exemption to the norm, in order to call for a global tender enquiry, is required to seek the Cabinet Secretariat’s prior nod.

So far, Ministries’ requests could be considered if they gave valid justification for the need to issue a global tender and the lack of alternatives within the country.

Now, Ministries can no longer seek a nod for issuing a global tender unless they have first floated a domestic tender for their requirements, and tried to locate domestic producers in co-ordination with industry bodies, as per new rules issued by the Cabinet Secretariat and the Finance Ministry over the past week. Moreover, departments also cannot submit exemption proposals unless they have first published their procurement plan for the next three and five years on their websites.

Publishing such a procurement plan was mandated by the Department of Promotion of Industry and Internal Trade (DPIIT) in September through a Public Procurement (Preference to Make in India) order.

Exemption offered

In an office memorandum, the Department of Expenditure has conveyed the Cabinet Secretariat’s instructions to Ministries and departments, stressing that domestic tenders need to be floated for all goods and services before a global tender could be considered.

However, local tenders floated before May 15 this year, when the new procurement norms came into place, shall not count.

‘Discuss, send proposal’

“Ministries, departments are requested to discuss with DPIIT, relevant industrial bodies for identification of domestic manufacturers and service providers and send the details of such deliberations along with the proposal,” the memo stated.

A blanket exemption to allow global tenders was recently granted for procurement of spare parts from foreign original equipment manufacturers after multiple departments and public sector firms raised concerns about the lack of domestic options.

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