Economy / Public Sector - Evolution, Reforms and Performance / Purchase Preference Policy.
Purchase Preference Policy.
The Purchase Preference Policy is a government initiative aimed at supporting Central Public Sector Enterprises (CPSEs) in the supply of goods and services. The policy provides preferential treatment to CPSEs in government procurement processes, benefiting government departments, autonomous bodies, and other PSEs. The key features of the Purchase Preference Policy are as follows:
- Criteria for Purchase Preference:
- Purchase preference is granted if the price quoted by a supplying CPSE is within 10 per cent of the lowest valid bid price, assuming other factors are equal.
- Support for CPSEs:
- The policy is designed to support and promote CPSEs by giving them a competitive edge in government procurement.
- Fair Competition:
- While providing preference to CPSEs, the policy ensures fair competition by considering factors other than price to be equal. This encourages CPSEs to maintain competitiveness in terms of quality, delivery timelines, and other relevant parameters.
- Encouraging Participation:
- The policy aims to encourage the active participation of CPSEs in government tenders and contracts.
- Balancing Public and Commercial Interests:
- By implementing a purchase preference, the government seeks to balance its commercial interests with the broader goal of supporting and strengthening public sector enterprises.
- Promoting Economic Objectives:
- The policy aligns with broader economic objectives, fostering the growth and viability of CPSEs, which, in turn, contributes to the overall health of the public sector.
The Purchase Preference Policy reflects a strategic approach by the government to leverage its procurement power to bolster the position of CPSEs in the market. It aims to create a supportive environment for public enterprises to thrive and compete effectively in the supply of goods and services to various government entities.
