Government Procurement

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Government Procurement in India
Domestic Regulations & Trade Prospects

Government Procurement in India
Domestic Regulations & Trade Prospects

Government Procurement in India
Domestic Regulations & Trade Prospects
Published by

D-217, Bhaskar Marg, Bani Park
Jaipur 302016, India
Tel: +91.141.2282821, Fax: +91.141.2282485
Email: cuts@cuts.org
Web site: www.cuts-international.org
With the support of

© CUTS International, 2012

First published: October 2012

This document has been produced with the financial assistance of the British High Commission, New Delhi under the Prosperity Fund of the Foreign & Commonwealth Office, United Kingdom and under a project entitled “Government Procurement – An emerging tool of global integration & good governance in India.”

The views expressed here are those of the authors and can therefore in no way be taken to reflect the positions of the British High Commission, New Delhi.
ISBN: 978-81-8257-173-0
Printed in India by Jaipur Printers Private Limited, Jaipur
#1221

Contents
Abbreviations
Note on Contributors

i
vii

Acknowledgement

xi

Preface

xv

Executive Summary
1. Introduction

xix
1

Background and Context

2

Government Procurement: The Theoretical Basis

7

Innovation and Government Procurement

20

Methodology

23

Structure of the Study

24

2. The Government Procurement Scenario in India

29

Introduction

29

The Size of the Public Procurement Market in India

31

Legal Framework

37

Preference Policies in Public Procurement

46

3. The Choices before India

103

Choices before India and the Option Exercised

103

Comparison of the Public Procurement Bill,
2012 with the WTO GPA 2011

105

Machinery for Ensuring Transparency and Fair
Competition in Public Procurement: A Comparison of
the Public Procurement Bill (PPB) with the WTO GPA

134

The Probity Aspects of the Public Procurement Bill

173

Overall Comparison of the PPB with the WTO GPA

178

Overall Assessment of the Public Procurement Bill, 2012:
Whether the Bill Lives up to its Expectations?

180

4. An Overview of Government Procurement in
Health Sector of India

203

Introduction

203

Market Size, Landscape and Competitiveness of
the IndianHealth Sector

205

A Brief Overview of the Indian Health Sector

208

FDI Policy in Healthcare

209

Opportunities for Foreign Suppliers in the Domestic
Government Procurement

212

Market Emerging Trends and Future Requirements

213

Analysis of the Pharmaceutical Industry

217

Legal Framework for Government Procurement

218

Existing Procurement System

218

Current Government Procurement System

220

Purchase Preference Policy

233

Market Access Opportunities for Indian Suppliers in
Foreign Government Procurement Markets

236

Possible Penetration in the Government
Procurement Health Sector

241

Suggestions for Improving Opportunities in
Government Procurement

244

Conclusion

246

5. Government Procurement Scenario in Indian
Information Technology and Information
Technology-Enabled Services
Introduction

265
265

Competitiveness and Market Size of the IT/ITeS
Government Procurement Sector

268

Suggestions for Improvement

292

Market Access Opportunities in Foreign
Procurement Markets

295

Conclusion and the Way Forward

301

6. Government Procurement: The Case of Indian Railways

309

Introduction

309

Competitiveness and Market Size of the Indian
Railway Public Procurement Sector

311

The Public Procurement System for Railways in India

321

Market Access Opportunities in Foreign
Government Procurement Markets

334

Conclusion

339

7. Prospects for India in Joining the Government
Procurement Agreement: An Assessment

351

Advocacy by the WTO Secretariat

352

Way Forward

359

Short term vs Long term...
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