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Para 1.8.2 - Procurement Priorities | KartavyaDesk

Goods Manual

Original Rule Text

2. To support social policies, reservation of Procurement of specified goods from MSEs, weaker sections, backward regions, and reservation of Procurement of certain goods from MSEs, 3. To strengthen local industry and job/ employment creation, preferential Procurement of locally manufactured goods or services (Rule 153 (iii) of GFR, 2017) and support to Startup enterprises (Rule 170(i), 173 (i) of GFR, 2017); 4. To achieve programme objectives, reservation of Procurement of specified class of goods from or through certain nominated CPSEs or Government Organisations; 5. On the grounds of defence of India or matters directly or indirectly related thereto, including national security, impose restrictions, including prior registration and/ or screening, on Procurement from bidders from, or bidders having commercial arrangements with an entity from, certain country or countries, or a class of countries. Rule 144(xi) of GFR, 2017 6. Facilitating broader objectives of other Departments of Government (for example, ensuring tax or environmental compliance by participants, Energy Conservation, accessibility for People with Disabilities, etc., Procurement policies and procedures must comply with accessibility criteria8 that the Government may mandate from time to time.

What This Means

Para 1.8.2 of the Manual for Procurement of Goods, 2017 outlines several key considerations that government departments must keep in mind during the procurement process. It's not just about getting the lowest price; it's about using government spending to achieve broader social and economic goals. This rule directs departments to prioritize certain groups and objectives when buying goods and services. This includes supporting small businesses (MSEs), weaker sections of society, and businesses in backward regions. It also emphasizes strengthening local industries and creating jobs by favoring locally manufactured goods and services, as well as supporting startups.

Furthermore, the rule allows for reserving procurement from specific government-owned entities (CPSEs) to achieve program objectives. It also addresses national security concerns by allowing restrictions on procurement from bidders associated with certain countries. Finally, it mandates that procurement policies align with broader government objectives, such as tax compliance, environmental protection, energy conservation, and accessibility for people with disabilities. In essence, this rule ensures that government procurement is used strategically to benefit various sectors and achieve national goals, while also adhering to security and accessibility standards.

This rule affects all government departments and agencies involved in the procurement of goods and services. It also impacts businesses that wish to supply goods or services to the government, particularly MSEs, local manufacturers, startups, and those operating in specific regions or sectors. Understanding this rule is crucial for both government employees involved in procurement and businesses seeking government contracts.

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Key Points

  • •Prioritizes procurement from MSEs, weaker sections, and backward regions to support social policies.
  • •Encourages preferential procurement of locally manufactured goods and services to strengthen local industry and create jobs.
  • •Allows reservation of procurement from nominated CPSEs or Government Organizations to achieve program objectives.
  • •Permits restrictions on procurement from bidders associated with certain countries for national security reasons.
  • •Mandates compliance with broader government objectives like tax compliance, environmental protection, and accessibility.

Practical Example

The Ministry of Rural Development needs to procure 500 solar-powered water pumps for a rural electrification project. According to Para 1.8.2, they should first consider MSEs located in backward regions that manufacture these pumps. Let's say 'GreenTech Solutions,' an MSE based in a designated backward district, bids for the contract at ₹50,000 per pump. Another company, 'Global Energy Corp,' a large enterprise, bids at ₹48,000 per pump.

Even though Global Energy Corp's bid is lower, the Ministry, following Para 1.8.2 and other relevant GFR rules, may choose to award the contract to GreenTech Solutions, provided their product meets the required quality standards and their price is within a reasonable range (e.g., within the L1+15% rule for MSEs). This decision supports the social policy of promoting MSEs in backward regions and contributes to local job creation, aligning with the objectives outlined in Para 1.8.2.

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Frequently Asked Questions

What does 'weaker sections' refer to in the context of this rule?▼
While not explicitly defined in Para 1.8.2, 'weaker sections' generally refers to socially and economically disadvantaged groups as identified by the government, such as Scheduled Castes (SCs), Scheduled Tribes (STs), and Other Backward Classes (OBCs).
How does this rule relate to the General Financial Rules (GFR)?▼
Para 1.8.2 directly references several rules within the GFR, 2017, such as Rule 153(iii) regarding preferential procurement and Rules 170(i) and 173(i) concerning support for startups. It essentially operationalizes these GFR provisions within the procurement process.
Can a department completely disregard cost considerations when applying this rule?▼
No. While Para 1.8.2 emphasizes supporting specific groups and objectives, cost-effectiveness remains a crucial factor. The rule doesn't allow for awarding contracts at significantly higher prices simply to favor a particular group. The price should be reasonable and justifiable, often within the parameters defined by other GFR rules (e.g., L1+15% preference for MSEs).
What kind of restrictions can be imposed on bidders from certain countries based on national security?▼
Restrictions can include prior registration requirements, mandatory security clearances, or even outright bans on procurement from entities based in or having significant commercial ties to specific countries deemed a national security risk. The specific restrictions are determined on a case-by-case basis by the relevant authorities.
How do I determine if a particular region is considered a 'backward region' for the purposes of this rule?▼
The definition of 'backward region' is typically determined by the government and may vary depending on the specific scheme or policy. Refer to the relevant government notifications and guidelines to identify the regions designated as backward for procurement preferences.

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Test Your Knowledge

Question 1 of 3

According to Para 1.8.2 of the Manual for Procurement of Goods, 2017, what is a key objective that government departments should consider during the procurement process?

Related Rules

Para 9.4Manual for Procurement of Goods, 2024 - Para 9.4 - Chapter 9Para 9.5.5Manual for Procurement of Goods, 2024 - Para 9.5.5 - Chapter 9Para 2.2.2Manual for Procurement of Goods, 2024 - Para 2.2.2 - Chapter 2Para 2.2Manual for Procurement of Goods, 2024 - Para 2.2 - Chapter 2Para 1Manual for Procurement of Goods, 2024 - Para 1 - Chapter 10 - Annexure 30

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