J&K Procurement Preference Policy for MSMEs
*Opportunities for local entrepreneurs still a mirage
Mohinder Verma
JAMMU, Sept 14: The much-touted Jammu and Kashmir Procurement Preference Policy for Micro and Small Enterprises (MSMEs), drafted with tall claims of empowering local entrepreneurs one year back, remains stuck in the draft form due to non-seriousness on the part of the Industries and Commerce Department.
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The MSME Development Act, 2006 and subsequent Public Procurement Policy (2012, amended in 2018) mandated States and Union Territories to prepare preferential frameworks to safeguard and promote small enterprises.
Adhering to the principles of competitiveness, fairness, transparency and cost-effectiveness, the J&K Trade Promotion Organization drafted the Jammu and Kashmir Procurement Preference Policy for Micro and Small Enterprises, 2024. It was pitched as a game-changer—meant to ensure fair play, create jobs and provide a lifeline to local units drowning under competition from outside suppliers.
The draft was submitted to the Industries and Commerce Department on September 6, 2024 for accord of approval. However, the department vide communicated dated September 27, 2024 directed the Trade Promotion Organization to put the draft in the public domain for inviting comments, suggestions and inputs from stakeholder/public.
Thereafter, the draft was placed in the public domain through the official websites of the Industries and Commerce Department and J&K Trade Promotion Organization for a period of 21 days—till October 31, 2024. In response, several stakeholders provided valuable comments. However, till date the draft J&K Procurement Preference Policy for Micro and Small Enterprises (MSMEs) has not been finalized, official sources told EXCELSIOR.
“As a result of this, every single objective of the policy lies defeated on the papers”, they further said, adding “what was meant to be a tool of empowerment has instead become a cruel reminder of how small industries are treated. Every day of delay is another lost contract and another unemployed youth denied opportunity”.
“The draft could have altered J&K’s industrial landscape, creating space for thousands of small entrepreneurs. Instead, it lies in cold storage – a symbol of broken promises. Drafting a policy without the courage or will to notify it is worse than having no policy at all. It raises false hopes and then abandons them,” sources remarked.
They further said, “if the administration continues to dither, the J&K Procurement Preference Policy, 2024 will go down not as a reform but as yet another case study in how Government fails the very people they claim to serve”.
The draft policy had promised to facilitate growth of J&K’s MSMEs, harness local entrepreneurial talent and maximize employment. However, the delay has ensured that none of these commitments translate into action.
It had envisaged prioritization of procurement from J&K-based units across Government departments, aided institutions and PSUs, a step that could have provided a lifeline to hundreds of struggling enterprises. But with the draft never finalized, local units continue to face exclusion in Government contracts.
Similarly, the draft aimed to enhance competitiveness through fair, transparent and cost-effective practices, besides increasing the share of MSE supplies and developing vendors in rural and peripheral areas. These goals too remain only on paper.
By promising to remove barriers such as Earnest Money Deposit (EMD) and tender fees that discourage small players from competing, the draft had raised expectations among entrepreneurs. Yet, the delay has left the existing bottlenecks unaddressed.
A major highlight of the draft was a commitment to guarantee 30% mandatory procurement from local units, coupled with a 25% price preference margin. Experts had hailed this as a bold step to ensure survival of J&K’s manufacturing sector. But with the policy stuck, this relief remains elusive.
The draft also spoke of special support for SC/ST and women-owned enterprises and marketing push for locally manufactured products, both of which could have broadened the entrepreneurial base. These too have been lost in bureaucratic inertia.
“Due to the Government’s non-seriousness in finalizing the policy, not a single objective-be it employment generation, vendor development, procurement assurance or social inclusion-has been achieved”, sources remarked.
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