Executive Summary:
This document presents the Indian government's policy regarding public procurement from Micro, Small, and Medium Enterprises (MSMEs). It outlines policy guidelines, procurement details from the last five years, MSME registration numbers, and awareness programs. The data on registered MSMEs is current as of July 15, 2025, and procurement data is updated as of July 22, 2025.
Key Points / Main Content:
Policy Guidelines:
• Mandates 25% annual procurement from MSEs by Central Ministries/Departments/CPSEs.
• Includes 4% from MSEs owned by SC/ST and 3% from MSEs owned by Women entrepreneurs.
• MSEs are provided tender sets free of cost and are exempted from paying Earnest Money Deposit.
• 358 items are reserved for procurement exclusively from MSEs.
Procurement Details:
• Details of procurement from MSEs by CPSEs for the last five financial years are available on the MSME Sambandh Portal (Annexure I).
MSME Registration:
• 6,58,33,368 MSMEs are registered on the Udyam Registration Portal (URP) as of 15.07.2025.
• State/UT-wise list of MSMEs, including Chhattisgarh, is provided (Annexure II).
Promotion of Procurement:
• The Public Procurement Policy is applicable to Central Government entities, not State Governments.
• The Ministry of MSME has requested States/UTs to implement similar policies; 26 have aligned their policies.
Awareness Programs:
• MSMEs can link with the GeM Platform through URP for government procurement.
• The National Scheduled Caste Scheduled Tribe Hub (NSSH) Scheme enhances the capacity of SC/ST entrepreneurs to participate in public procurement.
• Vendor Development Programmes are organized to create awareness among enterprises.
Impact Analysis:
Central Ministries, Departments, and CPSEs:
• Impact: Required to procure at least 25% of their annual procurement from MSEs, including specific targets for SC/ST and women-owned MSEs. Must provide free tender sets and exempt MSEs from Earnest Money Deposit.
• Action Required: Adhere to the Public Procurement Policy for MSEs, Order, 2012, and ensure compliance with the mandated procurement percentages.
Micro and Small Enterprises (MSEs):
• Impact: Benefit from the policy through increased procurement opportunities, exemption from certain fees, and participation in awareness programs.
• Action Required: Register on the Udyam Registration Portal (URP) to be eligible for the benefits under the policy.
State Governments/UTs:
• Impact: Encouraged to align their policies with the central government's Public Procurement Policy to promote MSEs in their respective regions.
• Action Required: Consider implementing policies that promote procurement from MSEs in their states/UTs.
SC/ST and Women Entrepreneurs:
• Impact: Benefit from targeted procurement provisions and capacity enhancement programs.
• Action Required: Participate in the National Scheduled Caste Scheduled Tribe Hub (NSSH) Scheme and other relevant programs to enhance their capabilities and increase their participation in public procurement.
Key Entities Referenced
Ministry of Micro, Small and Medium Enterprises: The Indian government ministry responsible for formulating policies and programs for the promotion and development of micro, small and medium enterprises.
Public Procurement Policy for Micro and Small Enterprises MSEs, Order, 2012: An Indian government policy aimed at promoting procurement from Micro and Small Enterprises (MSEs) by Central Ministries, Departments, and Central Public Sector Enterprises (CPSEs).
Central Public Sector Enterprises CPSEs: Enterprises in India in which the direct holding of the Central Government or other CPSEs is 51% or more.
SC/ST: Refers to Scheduled Castes and Scheduled Tribes in India, which are officially designated groups of disadvantaged people.
Udyam Registration Portal URP: An online portal by the Indian government for registering Micro, Small, and Medium Enterprises (MSMEs).
Chhattisgarh: A state in India.
GeM Platform: Government e-Marketplace - An online platform for public procurement in India.
National Scheduled Caste Scheduled Tribe Hub NSSH Scheme: A scheme by the Ministry of MSME to support SC/ST entrepreneurs in participating in the public procurement process.
GOVERNMENT OF INDIA
MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES
LOK SABHA
UNSTARRED QUESTION NO. 786
TO BE ANSWERED ON 24.07.2025
PUBLIC PROCUREMENT POLICY
786. SHRI BRIJMOHAN AGRAWAL:
Will the Minister of MICRO, SMALL AND MEDIUM ENTERPRISES be pleased to state:
(a) the policy guidelines for sourcing of goods by Central Ministries, Departments and Central
Public Sector Enterprises from MSMEs;
(b) the details of such procurement made from Micro, Small and Medium Enterprises (MSMEs)
during the last five financial years, year-wise;
(c) the number of MSMEs currently registered in the country and the list of enterprises, State/UT-
wise including the State of Chhattisgarh;
(d) whether any guidelines or instructions have been issued by the Union Government to
States/UTs to promote procurement under this policy, if so, the details thereof; and
(e) the programmes being implemented to create awareness among enterprises registered under
MSMEs regarding this policy?
ANSWER
MINISTER OF STATE FOR MICRO, SMALL AND MEDIUM ENTERPRISES
(SUSHRI SHOBHA KARANDLAJE)
(a): The Ministry of MSME, Government of India vide Gazette Notification No. S.O. 581(E),
dated 23rd March, 2012 notified the Public Procurement Policy for Micro and Small Enterprises
(MSEs), Order, 2012. The Policy (amended in 2018) mandates 25% annual procurement from MSEs
by Central Ministries/Departments/Central Public Sector Enterprises (CPSEs), including 4% from
MSEs owned by SC/ST and 3% from MSEs owned by Women entrepreneurs. As per the Policy,
MSEs must be provided tender sets free of cost and they are exempted from payment of Earnest
Money Deposit. A total of 358 items are reserved for procurement and have to be sourced from only
MSEs, as per the Policy.
(b): The details of procurement made from MSEs during the last five financial years, year-wise by
CPSEs as per MSME Sambandh Portal are attached as Annexure-I.
(c): The number of MSMEs currently registered in the country on Udyam Registration Portal(URP)
are 6,58,33,368 (as on 15.07.2025). The details of MSMEs, State/UT-wise, including the State of
Chhattisgarh are enclosed at Annexure- II.: 2 :
(d): The Public Procurement Policy for MSEs Order, 2012 is applicable to Central Government
Ministries/ Departments and CPSUs. This Policy is not applicable to State Government Ministries/
Departments/ PSUs. To promote the interest of MSEs across the country, communication has been
sent by the Ministry of MSME to all States/UTs with a request seeking cooperation for
implementation of the Policy in their respective States/UTs. 26 States/UTs have aligned their Policies
with the Ministries’ Policy.
(e): The Government has taken several measures to create awareness among enterprises. Through
URP, any MSMEs can link with GeM Platform and participate in Government procurement.
National Scheduled Caste Scheduled Tribe Hub (NSSH) Scheme of the Ministry of MSME
aims at capacity enhancement of SC/ST entrepreneurs. The Scheme is meant to empower SC/ST
entrepreneurs to participate in Public Procurement process and facilitate fulfillment of 4% mandatory
target of procurement from SC/ST owned enterprises under Public Procurement Policy. The various
components includes Capacity Building, Training and awareness.
Under the Procurement and Marketing Support Scheme of the Ministry of MSME, Vendor
Development Programmes are organised for creating awareness among enterprises. In addition,
regular Vendor Development Programmes are also organized by CPSEs.
*****Annexure-I
Annexure-I referred to in reply to part (b) of the Lok Sabha Unstarred Question No. 786 for
answer on 24.07.2025
Year wise Annual procurement from MSEs by CPSEs in the Last 5 Years
F. Years Total Procurement from Procurement from Procurement from
Procurement MSEs MSEs owned by MSEs owned by
(Rs. in (Rs. in Crores) SC/ST Women
Crores) (Rs. in Crores) (Rs. in Crores)
2020-21 1,39,419.81 40,717.67 768.53 749.20
(161 CPSEs) (29.21%) (0.55%) (0.54%)
(No. of MSEs (No. of MSEs (No. of MSEs
Benefited-1,77,594) Benefited-6,870) Benefited-5,140)
2021-22 1,65,383.04 53,778.58 1,302.50 1,713.27
(32.52%) (0.79%) (1.04%)
(162 CPSEs) (No. of MSEs (No. of MSEs (No. of MSEs
Benefited-2,27,049) Benefited-10,437) Benefited-11,383)
2022-23 1,74,316.32 64,721.65 1,546.91 2,318.99
(37.13%) (0.89%) (1.33%)
(166 CPSEs 2 (No. of MSEs (No. of MSEs (No. of MSEs
Department) Benefited-2,36,433) Benefited-10,354) Benefited-16,725)
2023-24 1,70,985.96 74,727.12 1,761.78 3,154.97
(153 CPSEs (43.70%) (1.03%) (1.85%)
and 1 (No. of MSEs (No. of MSEs (No. of MSEs
Department Benefited-2,58,449 Benefited-11,571 Benefited-21,339
2024-25 2,68,653.93 93,911.23 3,576.08 5,949.08
(149 CPSEs (34.96%) (1.33 %) (2.21%)
(As on (No. of MSEs (No. of MSEs (No. of MSEs
22.07.2025) Benefited-2,92,733) Benefited-21,404) Benefited-33,703)
Source: MSME SAMBANDH PortalAnnexure-II
Annexure-II referred to in reply to part (c) of the Lok Sabha Unstarred Question No. 786 for
answer on 24.07.2025
State Wise Total Enterprises Registered on UDYAM & UAP from 01/07/2020 to 15/07/2025
Sl. No. State Micro Small Medium Total
ANDAMAN AND
1 19261 157 3 19421
NICOBAR ISLANDS
2 ANDHRA PRADESH 3360676 16491 942 3378109
3 ARUNACHAL PRADESH 39037 344 19 39400
4 ASSAM 1183889 6523 519 1190931
5 BIHAR 3573259 11635 560 3585454
6 CHANDIGARH 68200 1247 124 69571
7 CHHATTISGARH 1135360 8198 701 1144259
DADRA AND NAGAR
8 HAVELI AND DAMAN 29903 901 132 30936
AND DIU
9 DELHI 1191761 27734 2689 1222184
10 GOA 112106 1094 79 113279
11 GUJARAT 3699208 53058 4124 3756390
12 HARYANA 1669870 22580 1729 1694179
13 HIMACHAL PRADESH 291899 2507 208 294614
14 JAMMU AND KASHMIR 736820 3162 203 740185
15 JHARKHAND 1317404 5758 349 1323511
16 KARNATAKA 4332188 30775 2238 4365201
17 KERALA 1576019 12627 744 1589390
18 LADAKH 18480 112 2 18594
19 LAKSHADWEEP 2208 0 0 2208
20 MADHYA PRADESH 4133259 19307 1150 4153716
21 MAHARASHTRA 8551716 72793 6694 8631203
22 MANIPUR 147987 412 17 148416
23 MEGHALAYA 53908 393 34 54335
24 MIZORAM 44951 207 6 45164
25 NAGALAND 60701 170 16 60887
26 ODISHA 2044179 9787 581 2054547
27 PUDUCHERRY 94030 654 62 94746
28 PUNJAB 1822767 16546 1205 1840518
29 RAJASTHAN 3735958 26543 1598 3764099
30 SIKKIM 28908 158 13 29079
31 TAMIL NADU 5270701 38540 2735 5311976
32 TELANGANA 2547334 19604 1749 2568687
33 TRIPURA 271441 679 45 272165
34 UTTAR PRADESH 7062336 39018 2475 7103829
35 UTTARAKHAND 539209 3945 270 543424
36 WEST BENGAL 4553732 23323 1706 4578761
Total:- 65320665 476982 35721 65833368