Govt asks departments, PSUs to prefer domestic leather goods

New Delhi: Giving a boost to the leather and footwear sector, the government has asked ministries, departments, public sector units and defence forces to give preference to domestic products in the segment.

In the e-tenders, they have to give preferential treatment to domestic leather, footwear and accessories companies, an official said.

This is part of an initiative of the department of industrial policy and promotion (DIPP) to encourage 'make-in-India' campaign and promote manufacturing and production of goods and services India.

The official also said domestic manufacturers that will supply goods such as saddlery, travel items, leather garments and high altitude footwear to the departments under the Public Procurement (Preference to Make in India), Order 2017, will have to use a certain percentage of local content in their production.

Up to 70 per cent minimum local content requirement is mandated for combat boot, safety shoes, footwear components, sports footwear with synthetic uppers and leather uppers.

Similarly 60 per cent minimum local content requirement was fixed for saddlery, travel goods, leather garment and gloves.

The minimum local content requirement will be reckoned with reference to ex-factory price on which the manufacturer has paid GST.

Further, DIPP will be the nodal ministry to monitor the implementation of this order.

Several other departments and ministries have already identified number of items for domestic content.

The department of defence production have identified as many as 90 such items and they will be notifying the domestic content for these products soon.

Similarly, department of pharma will be notifying the norms for four major categories, including consumables and implants.

Government tenders worth about Rs 13,000 crore were either cancelled or withdrawn and re-issued after the Department of Industrial Policy and Promotion (DIPP) stepped in to change their conditions for promoting 'made in India' goods.

The government had issued the order on June 15, 2017, to promote manufacturing and production of goods and services in the country to enhance income and employment.

Under the Public Procurement Order, it was envisaged that all central government departments, their attached or subordinate offices and autonomous bodies controlled by the Centre should ensure purchase preference be given to domestic suppliers in government procurement.