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BW Businessworld

Easing Public Procurement Process For SMEs

Alka Nangia Arora, Chairman and Managing Director, National Small Industries Corporation (NSIC) throws light on the initiatives of NSIC in making the public procurement process for SMEs hassle-free and increasing the share of SC/ST entrepreneurs in the country's total procurement

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Public procurement is a complex affair in India. The whole process at times can require a number of technical eligibility documents and Earnest Money Deposit (EMD) to ensure vendors’ genuine interest while bidding. These technical documents and EMD become a hinderance for small and micro firms in some cases and restrict their participation in public procurement.

The National Small Industries Corporation (NSIC), falling under the Ministry of Micro, Small & Medium Enterprises of India has been working round the clock to ease the public procurement process for these small industries. Alka Nangia Arora, Chairman & MD highlights the efforts of NSIC in working with different state governments so that these industries can adapt to their respective procurement policies.

“Every state has its own procurement policy but to substantiate what other states are doing and to create an awareness at the ground level among these industries around the different rules and regulations of different states such as their ways of dealing with transportation, the logistics of raw materials and how credit facilitation is done in these states is very important and that’s what we’re doing,” Arora explains.

NSIC is running a single point registration for SMEs to facilitate their participation in public procurement by getting them tender documents and waiver in EMD.

She further underlines the importance of raw materials in any industry and highlights the initiatives of NSIC in assisting the micro and small units to get raw materials. “The procurement of raw materials for these industries is not an easy affair. We’re helping them in supply of aluminium, iron, steel, praffin, etc.,” says Arora.

Stressing on increasing the participation of SC/ST entrepreneurs in the public procurement process, Arora says that the NSIC is giving impetus to these entrepreneurs through the ‘SC/ST Hub’ scheme. “We have been interacting very closely with all the PSUs. We have dedicated nodal officers at all PSUs for SC/ST entrepreneurs and are having regular vendor development programs and marketing events,” says Arora.

The efforts of NSIC have led to an increase in SC/ST entrepreneurs’ participation in public procurement. Their participation percentage in the total procurement by SMEs in the country has gone up from 0.0074 per cent to 1 per cent in recent times. The government has set a target of 4 per cent for these entrepreneurs. 

NSIC is now in talks with some Latin America countries as well as with countries like Korea and Taiwan to set up incubators and training centers. It already has a strong presence in many African countries where it has helped in setting up of rapid incubation centers. 

The speaker was present at the Emerging Business Summit & Awards by BW SME World.