Haryana eases norms for startups in public procurement process

Vijay C Roy

Tribune News Service

Chandigarh, February 14

Next time when the Haryana government floats tenders for public procurement, startups based in the state, having turnover of less than Rs 25 crore, would also be eligible to participate along with big companies. As per estimates, around 750 startups are likely to benefit with the relaxation in norms.

By easing the norms, startups, micro and small enterprises (MSEs) combined together would be eligible to bag 50% of the total contracts.

“We have done away with many of the provisions and making startups eligible in public procurement process. Most importantly, if their quoted prices are within band of L1 (lowest bidder) plus 15% or in plain terms if their quoted prices are higher by 15% as compared to the lowest bidder and they are ready to match with the lowest bidder, they will be eligible to bag the contract subject to fulfillment of other terms and conditions,” said  Haryana Additional Chief Secretary (Industries & Commerce) Devender Singh while talking to The Tribune on the sidelines of 147th meeting of the State Level Bankers’ Committee of Haryana held today.

Besides this, the government has exempted the startups from payment of tendering fee and earnest money deposit subject to conditions as per eligibility. 

The government has also allowed 90% concession on performance security as applicable to other companies.

Further, for qualifying to participate in government’s public procurement tenders, turnover criteria has been relaxed. They are being offered a concession of 80% on the “turnover condition” imposed as qualifying criteria.

According to a senior official, startups, especially in services and technology space, will be benefitted by the relaxation in norms. The state government has also exempted startups in respect of past performance and experience as part of the qualifying requirements for the tendering process. 

According to the notification, startups will be treated at par with the MSEs in public procurement process subject to meeting other technical specifications as part of qualifying requirements for the procurement.

At number seven, Haryana leads in the northern region with 710 startups. These are working in different sectors, including IT services, healthcare, education, food, agriculture, renewable energy and technology hardware. 

In 2016, the Central government had exempted startups from having prior experience while applying for public procurement contracts. Later, several state governments such as Rajasthan, Gujarat and Maharashtra also relaxed the norms for startups. 

Conditions relaxed

• Exemption from payment of tender fee, earnest money 
• 90% concession on performance security
• 80% concession on turnover condition
• Exemption in respect of past preference, experience