Government mandates preference to India-made vehicles in public procurement

NEW DELHI: The government has mandated preference to be given to domestically-manufactured vehicles with minimum 65 per cent local content in public procurement of automobiles, according to an official notification. As per the new norms notified by the Heavy Industries Ministry with an aim to "encourage Make in India" and to promote manufacturing and production of goods and services locally, "preference shall be provided by all government procuring entities to domestically manufactured automobile and automotive components".

The notification applies to automobiles based on internal combustion (IC) engines including two and three wheelers, passenger vehicles and commercial vehicles and components or spares required for their manufacture and maintenance.

The percentage of local content required to qualify as domestically manufactured automobile has been set at 65 per cent, it said.


On the other hand, for auto components the percentage of local content required to qualify as domestically manufactured has been set at 60 per cent, the notification added.

The new norms have already come into effect and would be reviewed after March 31, 2019. They shall remain valid till a revised notification is issued.

"The local supplier at the time of tender, bidding or solicitation shall provide self-certification that the item offered meets the minimum local content and shall give details of the location(s) at which the local value addition is made," said the notification.

In cases where the procurement is for a value over Rs 10 crore, the local supplier shall provide a certificate from the statutory auditor or cost auditor of the company (in the case of companies) or from a practising cost accountant or practising chartered accountant (in respect of suppliers other than companies) giving the percentage of local content, it added.