Public procurement from women-led small businesses highest in FY22; these ministries were biggest buyers
Ease of Doing Business for MSMEs:The annual procurement target for CPSEs from MSEs was revised in 2018 to 25 per cent from earlier 20 per cent of their total annual purchases. The 25 per cent procurement included a sub-target of 3 per cent from women entrepreneurs and 4 per cent from SC/ST entrepreneurs.
Ease of Doing Business for MSMEs: Public procurement from women-owned micro and small enterprises (MSEs) in the current financial year has recorded the highest growth during the FY19-22 period amid the government’s push to purchase more from women entrepreneurs. According to MSME Sambandh data of four years, nearly Rs 900 crore worth goods were procured from over 6,900 women-owned MSEs by various ministries in the current financial year in comparison to Rs 718 crore worth goods purchased from 4,992 women MSEs in FY21. Moreover, the procurement share of women MSEs in the overall MSEs’ share in public procurement reached an all-time high of 0.79 per cent in the current financial year.
Over Rs 37,000 crore worth goods were purchased from more than 1.66 lakh MSEs in FY22 with a share of over 32 per cent in CPSEs’ total procurement of more than Rs 1.13 lakh crore during the year.
The annual procurement target for CPSEs from MSEs was revised in 2018 to 25 per cent from earlier 20 per cent of their total annual purchases. The 25 per cent procurement included a sub-target of 3 per cent from women entrepreneurs and 4 per cent from SC/ST entrepreneurs. However, the government has been unable to achieve the two sub-targets so far. From Rs 232.56 crore worth procurement across 1,410 enterprises in FY19 with only 0.15 per cent share in overall MSE procurement, the value of goods purchased jumped to Rs 393.56 crore from 3,667 enterprises in FY20 even as the share increased marginally to 0.20 per cent.
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Mismatch in requirements of central public sector enterprises (CPSEs) and goods produced by women-owned micro and small enterprises (MSEs) along with quality issues in products and their limited range are the reasons why government entities have not been able to meet the mandatory annual procurement target from women MSEs, Ishita Ganguly Tripathy, Additional Development Commissioner, Office of DC-MSME, Ministry of MSME had told Financial Express Online last year. To improve women MSEs’ share, Tripathy had said that CPSEs agreed to procure services as well from such units apart from goods. Moreover, the government may also review the list of 358 items reserved exclusively for procurement from MSEs.
CPSEs in Ministry of Petroleum and Natural Gas (with procurement worth Rs 386 crore), Ministry of Defence (Rs 134 crore), Ministry of Power (Rs 114 crore), Ministry of Steel (Rs 62.9 crore), and Ministry of Mines (Rs 27.9 crore) were biggest buyers of goods from women MSMEs in the current financial year.