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Digitization of the procurement portal has eased up the mode of business for the SMEs and the PSEs resulting in savings about 1 % of the GDP
Aug 23, 2018

CII organised the 5th National Vendor Development Programme (NVDP) on 23rd August 23, 2018, in partnership with Ministry of MSME and NSIC, at the Silver Oak Hall in the Indian Habitat Centre.

The NVDP brought together leading Indian PSUs from across sectors and the MSMEs, to promote long term supply relationships between them and sensitize MSMEs about the product and service requirements, procurement policies and procedures as well as the vender registration processes, delivery terms, tender documentation, etc. of leading PSUs.

The Inaugural Session was opened by Mr. Shreekant Somany, Chairman, CII National MSME Council, followed by Key note addresses of Mr. Ram Mohan Mishra, AS & DC, MoMSME and Mr. Suresh Kumar, Additional CEO, GeM. The session was closed by Mr. Nalin Kohli, Co-Chair, CII National MSME Council.

Mr. Shreekant Somany emphasized on the importance of the SMEs to the GDP and ensuring social inclusion. He said that with around 63.4 million units throughout the geographical expanse of the country, MSMEs contribute around 6.11% of the manufacturing GDP, 24.63% of the GDP from service activities and 33.4% of India's manufacturing output. They have been able to provide employment to around 120 million persons and contribute around 40% of the overall exports from India. The product range of the Indian MSME sector spans from traditional and handicraft products to hi-tech items. This makes them almost indispensable to the growth of the economy.

He also focused that CII with its strength of a huge SME membership (almost 70 percent of the total), it stands at the right place to pitch the voices of the smaller and medium yet very significant players. Given the huge responsibility, CII has certain flagship programmes like Technology Facilitation Centre, Finance Facilitation Centre, Defence & Aerospace Consulting Services, Global SME Summits, Trade fairs, International missions and training programmes, Cluster Initiatives, National Vendor Development Program along with rigorous policy advocacy to promote and encourage the SMEs to reach new heights.

Some of the key recommendations that were discussed were:

State level Public Procurement Policies must be launched for expanding the coverage of public procurement from MSEs

A central repository of information should be created on MSMEs manufacturing various products across the country

Empanelment and enrolment fee should be abolished, and earnest money deposit exemptions must be strictly implemented for procurement orders to MSMEs

PSUs and other procuring agencies, measures such as regular engagement with MSEs, simplification and standardization of vendor registration processes, easier bid norms, regular vendor development programmes, feedback to MSEs, timely payments, etc. can assist in enhancing MSE procurements.

Mr. Udaykumar apprised the participants with the benefits of mandated public procurement and how the PSUs have struggled to reach the mandated procurement criteria. Nevertheless, mandated procurement of 4 % from the SC/ST entrepreneurs still remains a challenge. He said that the NSIC has been trying via its digital platform to ease out this process too by providing a ready database of such entrepreneurs where the PSUs can fulfill their mandated purchase criteria. The use of digital platforms such as MSME Sambandh, MSME Samadhan and MSME databank have proved to be quite useful for keeping systems in place and easing out the procurement process. He further added that NSIC should also take steps towards aggregating credible vendors engaged in new innovative ideas.

Mr. Suresh Kumar, Additional CEO, GeM  added to the discussion mentioning  GeM facilitation in bringing commendable change in the system of procurement and sale. Through digitizing the process, the PSUs have saved time in finding credible vendors and also saved upto 1% of the national GDP through reducing transaction costs, effort and time. While there are almost 1,33,000 vendors listed in the GeM portal, Mr Kumar emphasized that given the plethora of SMEs, this is a very small number. He concluded that the potential remains high and it is required to explore all avenues and to list maximum vendors in the government process for the benefit of both sides.

Mr. Ram Mohan Mishra also applauded the NVDP concept and said that more such events are needed to be organised to promote and encourage the MSMEs. He also emphasizes on the need for bigger companies to provide handholding support to the SMEs which will provide them a chance to develop. He added that apart from CSR activities, the bigger companies should also provide support to MSMEs in terms of technical upgradation and enteingr the market.

Mr. Nalin Kohli closed the session by re-emphasizing on the need of Small, Medium and large industries working in tandem which will not only lead to the growth of the SMEs in particular along with catering to the larger goal of economic growth.

Mr. Rajesh K Chaudhury, Joint Secretary, Department of Public Enterprises, appreciated the efforts put together to promote SMEs and asked Ministry of MSME in collaboration with CII to compile the issues and suggestions, discussed during the event and submit a policy recommendation note based on the discussion to the Department of Public Enterprises. He said that DPE would further forward these recommendations to the PMO.

New Delhi

23 August 2018 

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