GoI: Public procurement Norms modified

The Government of India recently modified public procurement norms. Under the new norms maximum preference is to be given to those goods and services that have 50% or more local content. This has been done to promote “Make in India”.

Highlights

The GoI recently issued the Public Procurement (Preference to Make in India), Order 2017. The new order has introduced Class-I, Class-II and non-local suppliers. The goods and services are to get preferences based on their classes.

Class I

The goods and service company that have domestic value addition of 50% and more have been classified under Class I. These goods and services will get the most preference in all government purchases.

Class II

The goods and service company whose value addition range is between 20% and 50% come under Class II supplier.

Non-local suppliers

The goods and service company that has less than 20% of domestic content in the products are classified as non-local suppliers. These companies cannot participate in most of the government tenders.

Background

In the earlier orders, local suppliers were those whose goods and services had a minimum of 50% of local content. Earlier, there was no categorization among the local suppliers. Local content is amount of value added to a product in India.

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