More government projects are set to fall under the purview of ‘Policy for Providing Preference to Domestically Manufactured Iron & Steel Products in Government Procurement’ (DMI&SP Policy) after the amendment made by the Indian government took effect on Dec 31, 2020.
The policy was initially established in May 2017 to accomplish the ‘Make in India’ vision by giving impetus to domestic manufacturing. The earlier policy applied to the supply of iron & steel products with an aggregated estimate value of Rs250mn or more. In the amendment, this value has been reduced to Rs500,000, encouraging even smaller government projects to source material from local steelmakers.
Moreover, it will also be applicable for all Central Sector Schemes and Centrally Sponsored Schemes, if that project or scheme is funded by the Government of India. Procurement for projects under these schemes is usually made by states and local bodies. Earlier, it only applicable for projects funded by any Ministry or Department of Government, including all agencies and entities under their administrative control, for the purchase of iron and steel products.
The amendments are likely to boost domestic production and consumption in the coming years. It could also keep in check, the imports of substandard steel, especially from the countries known for dumping.