PSUs to Ensure 20% Procurement from MSMEs


The government, in a move likely to have a big impact, has made it mandatory for all central government ministries and departments to procure at least 20% of products and services from MSMEs or micro, small and medium enterprises.

“If the MSMEs can deliver the goods and services as per prescribed technical & quality specifications, the norms on prior experience and prior turnover will be relaxed for them,” the MSME Ministry said in a release.

“The move will enable startup MSMEs to be a part of the mandatory 20 per cent public procurement. The relaxation has been made to create a conducive environment for the startups in India, which is high on the agenda of the government,” the MSME Ministry said.

Vakilsearch's resident expert on starting up, compliance and accounting, he holds a Masters in Accounting and an LLB.