For the Modi government the goalposts seem to be fast shifting from just Make In India to Buy In India. The mega policy is to be in the works covering several key economic sectors, where domestic procurement should be given preference. The the Prime Minister’s Office had a meeting on the contours of the proposed policy, which could be rolled out soon.
The Union government has come up with decisions for sectors such as petroleum and steel, highlighting preferential domestic procurement, but the new policy with the swadeshi focus is expected to be much larger in scope
The government is planning to come up with a policy which has a thrust on local procurement, as it is keen to spread a feel-good factor. a bureaucrat who has been associated with key economic sectors said that, “preferential domestic procurement has always been controversial and there’s a possibility of it getting challenged at the World Trade Organization (WTO)”.
Madan Sabnavis, chief economist, CARE Ratings has said that, there could be merit in such a policy, as the economic growth has been slow and the government has been the primary spender on infrastructure projects.
Any policy on preferential domestic procurement could imply job creation, a priority area for the Narendra Modi government. The Minister of State for Commerce & Industry said that the government is planning to come out with a policy on Industrial Revolution 4.0 by September, marking the third anniversary of Make In India, to help companies manufacture in the country and create jobs.
In March, the government has announced a restructured general finance rules for public finance, including government procurement, to give first preference to locally manufactured goods.
Recent steps taken to promote local procurement
MAY 2017: Policy on preference for sourcing of domestic iron and steel for infrastructure projects being built by state-owned companies
MAY 2017: Phased manufacturing plan announced by Ministry of Electronics & Information Technology to promote Make In India, with a thrust on local sourcing
APRIL 2017: Cabinet nod to purchase preference given to domestic manufacturers in procurements done by state-owned oil and gas firms
MARCH 2017: General financial rules on public finance — including government procurement — restructured, to give first preference to locally manufactured goods