Govt fixes minimum percentage of local content in 55 chemical, pesticides

The Ministry of Chemicals and Fertilisers on Tuesday fixed the minimum percentage of local content in public procurement of 55 chemical and pesticide products as part of the government's effort to boost domestic manufacturing and the Make-in-India programme.

According to the new norm, the minimum local content has been fixed at 60 per cent for 2020-21, 70 per cent for 2021-23 and 80 per cent during 2023-25, an official statement said.

The Department of Promotion of Industry and Internal Trade (DPIIT) had revised the Public Procurement (Preference to Make in India) Order, 2017, to encourage Make in India and to promote manufacturing and production of goods, services and works in India with a view to enhancing income and employment.

While identifying chemicals and petrochemicals, prescribing minimum local content, and the manner of calculation, the ministry said it has assessed the domestic manufacturing available capacity and the extent of local competition.

"As many as 55 various types of chemicals, petrochemicals, pesticides, and dyestuff have been identified. The minimum local content for these chemicals and petrochemicals has been prescribed by the department beginning with a local content percentage at 60 per cent for the year 2020-21 and thereafter, raising it to 70 per cent for the years 2021-23 and 80 per cent for the years 2023-25," the ministry said in an official statement.

Out of the 55 products, local suppliers would be eligible to bid for the estimated value of procurement of more than Rs 5 lakh and less than Rs 50 lakh for 27 products. For the remaining 28 chemicals and petrochemicals, the procuring entities should make procurement only from local suppliers irrespective of the bid amount as there are sufficient local capacity and local competition.

"This step will strengthen Atmanirbhar Bharat Abhiyan launched by Prime Minister (Narendra Modi) and will also boost domestic production under Make in India," the statement said.

Mansukh Mandaviya, Minister of State for Chemicals and Fertilisers, said, "Mandatory public procurement of chemicals and petrochemicals to boost manufacturing and production of goods, services and works will promote Make in India.