Good news for start-ups! No prior experience in public procurement required to get tenders

In what could be a blessing of sorts for Indian start-ups, the government has decided to exempt all start-ups from the prior experience criteria in public procurement. Until now, only micro and small enterprises enjoyed this privilege.

As per a directive issued by the department of expenditure to all ministries, all start-ups -- "micro, small or otherwise" -- may now be exempted from certain eligibility criteria in the tendering process.

After this decision, start-ups in the manufacturing sector will get equal opportunities as the established companies, enabling them to participate in such tenders with relaxed eligibility conditions.

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It was in March this year, when PM Modi had launched the Start-up India initiative that the Micro Small and Medium Enterprises had ministry issued an order to all ministries and central public sector units to relax conditions asking for prior experience and turnover for start-ups in all public procurements.

However, since the order only mentioned small and micro enterprises covered by the Public Procurement Policy for MSE order 2012, all start-ups were not able to make use of this relaxation.

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"The latest order has now put to rest earlier confusion over which start-ups are eligible for such benefits," a senior official told ET.

The public procurement policy asks for central government department and ministries and its central PSUs to procure at least 20% of their purchases from micro and small enterprises, beginning April 1, 2015.

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