In the fiscal year 2022–23, the purchases by government organisations from micro and small businesses (MSEs) reached a record high. According to the official data, central public sector enterprises (CPSEs) purchased goods and services from 2.16 lakh MSEs for a total of US$ 7.12 billion (Rs. 58,429 crore) during FY23, an increase of 9.3% in purchases made from 2.25 lakh MSEs during FY22.
According to the Public Procurement Policy for MSEs, Order 2012, it is required that central ministries or businesses purchase a minimum of 25% of their yearly total from MSEs.
For purchases from MSEs owned by SC/ST entrepreneurs and women entrepreneurs, respectively, sub-targets of 4% and 3% have been set within the 25%. In FY23, purchases made by two MSE subcategories also reached a record high.
In FY23, CPSEs made purchases from SC/ST MSEs totalling US$ 159 million (Rs. 1,312 crore), or 0.78% of all MSE purchases. In contrast, SC/ST MSE purchases in FY22 totalled US$ 157.2 million (Rs. 1,290 crore), accounting for the same 0.78% of all MSE purchases made during the year.
The petroleum and natural gas ministry, which spent US$ 2.88 billion (Rs. 23,706 crore) on MSE purchases in FY23, came in first place, followed by the military ministry, which spent US$ 829.9 million (Rs. 6,804 crore) on MSE purchases.
The MSME ministry had created an updated list of 469 items (including commodities and services) to be reserved for exclusive procurement from MSEs in October of last year in order to increase small business procurement. The list, which originally comprised 358 items but only included commodities for exclusive procurement, had added a number of services.
