Female-led small business government procurement highest in FY22; these ministries were the biggest buyers


Ease of doing business for SMEs: The annual purchasing target for SME’s CPSE was revised in 2018 to 25 percent from previous 20 percent of their total annual purchases. The 25 percent procurement included a sub-target of 3 percent from female entrepreneurs and 4 percent from SC/ST entrepreneurs.

Easy business for MSMEs: Female-owned micro and small enterprises (MSEs) procurement has seen its current fiscal year fastest growth over the period from FY19-22, amid government pressure to source more from female entrepreneurs . According to MSME Sambandh’s four-year data, nearly Rs 900 crore worth of goods were purchased from over 6,900 female MSEs by various ministries in the current fiscal year as compared to Rs 718 crore worth of value goods purchased from 4,992 female MSEs in FY21. In addition, the purchasing share of female MSEs in the total share of MSEs in public procurement reached a record high of 0.79 percent in the current fiscal year.

Over Rs 37,000 crore worth of goods were purchased from over 1.66 lakh MSEs in FY22 with over 32 percent share of total CPSE purchases exceeding Rs 1.13 lakh crore during the year.

The annual purchasing target for CPSEs from MSEs was revised to 25 percent in 2018 from previous 20 percent of their total annual purchases. The 25 percent procurement included a sub-target of 3 percent from female entrepreneurs and 4 percent from SC/ST entrepreneurs. However, the government has so far failed to achieve the two sub-goals. From Rs 232.56 crore worth of purchases at 1,410 companies in FY19 with just 0.15 percent share of total MSE purchases, the value of goods purchased rose to Rs 393.56 crore from 3,667 companies in FY20, even as the share increased marginally to 0.20 percent.

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Mismatch in the requirements of central government 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 government agencies have been unable to meet meeting the mandatory annual procurement target of female MSEs, Ishita Ganguly Tripathy, commissioner for additional development, office of DC-MSME, ministry of MSME, had told Financial Express Online last year. To increase the share of female MSEs, Tripathy had said CPSEs agreed to purchase services from such units in addition to goods. In addition, the government may also revise the list of 358 items reserved exclusively for procurement of MSEs.

CPSEs in Ministry of Petroleum and Natural Gas (with purchase value of Rs 386 crore), Ministry of Defense (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 the largest buyers of goods from female SMEs in the current fiscal year.

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