Public procurement norms: Govt may hike local content requirement

Former industry secretary Ajay Dua said that over time, the minimum threshold had to be increased to promote local industries and increase the contribution of manufacturing to GDP

The government is planning to tweak its procurement policy to give a fillip to domestic manufacturing. The industry department has floated a proposal to raise the minimum local content requirement for public procurement for Class-I and -II suppliers from 50 per cent currently to 70 per cent, and 20 per cent as of now to 50 per cent, respectively.

However, it has suggested exempting defence production, electronics and information technology, telecommunications, mines, railways, power, ports, and shipping & waterways from the enhanced limits, a senior government official told Business Standard, requesting anonymity.
 

“The inter-ministerial consultation process is on. The departments and