In a recent development, 20% of government purchases are slated to be procured from the MSMEs. This is proposed by the National Small Industries Corporation (NSIC), in order, to boost the annual sales of micro, small and medium enterprises (MSMEs). Though the proposal is still in the consultation stage, but within 3 to 6 months, NSIC expects it to become legislation after receiving notification from the ministry of Micro, Small & Medium Enterprises.
NSIC Chairman and Managing director H P Kumar, said that the rules are framed to boost the MSME sector. He attended a seminar in Chandigarh where he said that the state governments will also have to frame similar rules to make 20% of purchases from MSMEs mandatory. According to the proposed rule, PSUs will have to make 20% of total purchases from micro units, at-least for three years and then on a yearly basis. NSIC will conduct inspections to give certifications of quality under the single point registration scheme.
NSIC is also responsible for raw material distribution under the raw material assistance scheme. This scheme, is meant to help MSMEs procure raw materials easily and to enable small enterprises finance the purchase of indigenous and imported raw materials. There are already 40 NSIC raw material distribution centres and 10 more are yet to open. The centres distribute steel, aluminum and other ferrous metals across India and are trying to add zinc, non-ferrous metals and plastic raw materials to the list. “NSIC distributed raw material to the tune of Rs 4,300 crore last year and we look forward to having a turnover of Rs 6,000 crore this year,” Kumar said.
Around 358 items are classified out of 6,000 products produced by the Indian MSMEs which should be included in government purchases from MSMEs. Enterprises registered with NSIC are entitled to various schemes and benefits like tender sets’ free availability and exemptions from payment of earnest money.
A L Agarwal, vice-chairman, Haryana Chamber of Commerce and Industry, said “This is definitely going to help Indian MSMEs. Once the rules become legislation it will give a fillip to MSMEs.”
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