The Indian Railways has taken a big step to promote micro and small enterprises by reserving 358 items including cleaning apparatus, stationery and leather items exclusively for procurement from the MSE sector. Besides, in a relief to the MSEs, the sector has been exempted from paying tender cost and earnest money deposit for participating in the railway tender. “Though earnest money is required to be deposited in all modes of tendering, we have decided to exempt the MSEs from depositing it with the tender document,” said a senior Railway Ministry official.
The growth of small business is crucial for India’s economic development and the support of the formal and organised sector like railways will help it unleash its true potential. There are a total of 9,973 MSE vendors registered on the Indian Railways procurement portal and Rs 4,400 crore worth of materials are procured in a year from the sector.
The state-run transporter has firmed up an action plan to increase participation of the MSE sector in the public transporter’s procurement. In addition to the 358 items including handicraft and painting brushes exclusively reserved for procurement from MSEs, railways will now allow the sector in procurement of several other items also. The official said MSEs will be now encouraged to participate in the business of maintenance and operation of rolling stock and also in procurement of cables, linen, paints, coupler body, wall panelling, cutting and drilling machines.
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Recently the national transporter has organised a meeting to increase the participation of micro and small enterprises in railway procurement. The meeting was attended by Railway Minister Suresh Prabhu and senior officials from the ministry and the Small Industries Development Bank of India (SIDBI) besides MSE vendors. Stakeholders from railways were advised to extend their support to MSEs and take steps for their development. The Research Designs and Standards Organisation (RDSO), the research wing of the Railways, was advised to extend its support to MSE vendors on technical issues and SIDBI was advised to provide financial support to MSEs.