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Govt finalises procedure for implementation of PMA in procurement through DGS&D

Wednesday, October 16, 2013: Taking a step further in the direction of implementing Preferential Market Access policy, the Department of Commerce, Government of India, has constituted a committee under the chairmanship of Rita Teaotia, additional secretary, Department of Telecommunication for the implementation of the policy for providing preference to domestically manufactured electronic products in the procurements carried out by DGS&D.

The committee constituted vide its order dated 28 February, 2013 was mandated to recommend the steps and methods of operationalisation of the said policy in DGS&D for the public procurement of goods under DGS&D rate contracts. The committee included representatives of Department of Electronics and IT, Department of Telecommunications, Department of Commerce and DGS&D.

DGS&D is presently concluding annual rate contracts through on-line open competitive bidding amongst registered suppliers for variety of common user Goods including Electronic/IT/Telecom/Solar sector Goods, list of which was perused by the committee. Except for specific requests/indents, DGS&D does not procure the Goods directly and, instead, user Government departments including Defence, procure their Goods directly either by way of tendering or by on-line supply orders against DGS&D Rate Contracts as per GFR provisions. The robustness in DGS&D procedures including complete transparency in concluding Rate Contracts are well established and time-tested and are available on its website in public domain.

The Committee has since finalised its report on 2 September, 2013. The committee report makes very clear recommendations with regard to the procedure for implementation of modalities for the implementation of the policy for providing preference to domestic manufacturers of electronic goods in the process of rate contract finalization of goods by DGS&D. The main recommendations of the Committee are as follows.

* All items for which notification has been issued under the policy for providing preference to domestic manufacturers in government procurement vide the policy notification dated 10.2.2012 will be covered under the said procedure of the DGS&D.

* DGS&D as nodal agency should promote the policy for providing preference to domestically manufactured electronic products based on notifications issued under the Policy by DeitY, DoT and any other department in the public procurement by Government and its agencies.

* DGS&D shall indicate in their Rate Contracts, the requirement of domestic value addition prescribed under the product notifications issued under the Policy/Guidelines for the item to be compliant with the Policy for the guidance of purchasers for each product.

* DGS&D shall also furnish the domestic value addition as provided by the manufacturer for each product and model. DGS&D shall continue concluding their Rate Contracts (RC) with suppliers as per existing procedures. The responsibility shall lie with the government user departments and agencies under their control to make procurements in compliance with the criteria prescribed in the notified policies & guidelines.

* DGS&D shall obtain necessary affidavit regarding domestic value addition in prescribed Form I of the Guidelines dated 12.06.2013 and incorporate the domestic value addition in their existing or future rate contracts for each notified product, model wise. The vendors shall have the option to upgrade, but not downgrade, the domestic value addition content of existing RCs through affidavit in prescribed Form I. DGS&D shall update the RCs accordingly without affecting the price.

* In the event of submission of upgraded Form I, all supplies made after the date of such submission shall be with upgraded domestic value addition only. The relevant date for compliance to value addition norm by domestic manufacturers shall be the date of the supply/purchase order by the requisitioning department/purchaser/indenter.

* Pending final disposal of any complaint against the self certification for domestic value addition provided under the Policy, the process for awarding the RC/continuation of existing RC shall not be put on hold. DGS&D should ensure through their Tender conditions that domestically manufactured electronic products are encouraged and are not subjected to restrictive product specifications or mandatory requirement of prior experience. They may also rationally identify and evaluate predatory pricing by any bidder. However, DGS&D may continue to incorporate such stipulations as may be considered necessary to satisfy the security, manufacturing capability and product quality of the manufacturers.

* DGS&D holds regular Consultative Committee Meetings (CCMs) for framing the technical specifications and Eligibility Criteria for various products before inviting bids for Rate Contracts. In addition to their existing practice of inviting all stakeholders including Industry, Trade associations and Government user departments, DGS&D should also invariably invite representatives of DoT and DeitY in such CCM meetings for products notified under the policy.

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