CHENNAI: In a bid to help boost the growth of domestic sector under the Make in India policy, the Tamil Nadu government is looking at framing guidelines making it mandatory for public entities to procure goods and services from local suppliers.
The move comes after the Union Commerce and Industry Minister and Union cabinet secretary have urged all the States to consider formulating guidelines for giving preference to locally manufactured goods in public procurement to provide an impetus to the local manufacturing units.
Official sources told Express that the move will incentivise domestic industry by providing market access and reliable demand through preferential procurement of domestically manufactured goods by the government agencies.
It is learnt that the State will have to go in for local bidding if the value of procurement is between `5 lakh and Rs 50 lakh provided sufficient local capacity exists to generate competition.
Similarly, to qualify as a local supplier, the company will have to ensure that the product or service it is offering has a minimum of 50 per cent local content.
If the estimated procurement of goods is more than Rs 50 lakh and can be divisible, then the bidding will be open to both local and non-local suppliers.
If the local bidder wins the bid, he is eligible for procurement for entire quantity but if the non-local supplier wins then only 50 per cent of his supply will be procured and the rest will be awarded to the local bidder, whose price falls within the margin of purchase price.
Sources indicated that the note by Centre has been circulated to all Secretaries of departments and their feedback has been sought.