Monday, 07 October, 2013: Though alternative procurement methods are available with the government departments, about 99 per cent of the common user items are procured by these departments through the Directorate General of Supplies & Disposals (DGS&D) on rate-contract basis. In an interview with Electronics Bazaar, Satya N Mohanty, director general, DGS&D, speaks about some of the changes that will soon be implemented to improve the procurement process further at DGS&D and the challenges faced.
EB: What is your view on adding more products and vendors under DGS&D portfolio?
We are in favour of adding more products and vendors under DGS&D portfolio as this will lead to a healthy competition and realisation of better value for the government.
EB: Are you seeing an increasing trend in procurement of electronics products through DGS&D?
Yes, procurement of electronic products is going up year on year.
EB: With the dipping of rupee and the dollar getting stronger, what is DGS&D’s strategy to safeguard the vendors?
Like everyone else we are also clueless. May be we will introduce exchange rate variation (ERV) clause but that requires the contract to be for more than 15 months. None of our contracts are for more than 15 months in the IT sector. We also do not have experience of operating ERV clause. In any case, a vendor can close his rate of contract giving 45 days’ notice. Systematic safeguard of this nature is also available.
EB: Is there any price preference for MSMEs?
There is no price preference as such. About 305 items have been reserved for MSMEs and wherever DGS&D finalises rate contracts for these items, it is only the MSMEs who can bid and avail the rate contract.
EB: Have you added any new features to your e-procurement process?
The entire procurement work, be it ad-hoc tender or rate contract, is done on the e-procurement platform. Recently, we have introduced eauction and e-reverse auction in this platform. Most of the purchases at DGS&D go through referral purchase, which were not being captured by the data base. So, recently, we have attempted to capture them by levying a referral purchase fee of 0.25 per cent. Another new feature is that, an applicant can now see the check list and know where he is falling short. Once the complete application comes in, the applicant is deemed to be registered until short falls are pointed out.
EB: Are there any new scheme in the pipeline to bring improvement in the procurement system?
We will soon introduce a catalogue for a large range of items with net dealer price. This will particularly be applicable to products where design, feature, performance, parameters of such products and goods differ significantly among the products of different manufacturers and even between different models of the same manufacturers, and where equitable comparison of prices of such products are not feasible.
Secondly, we will soon convert the rate-contract system to an open system, whereby government departments can do value purchases. The new company that has ventured after our rate contract was finalised or a company which was unable to participate at the time of the rate-contract tender, can now come in post-facto with a reduction in the prices, which is to be 5 per cent lesser than the existing rate-contract prices.
EB: What are the challenges DGS&D faces with reference to vendors and buyers?
Vendors should know that it is a level-playing field and no advantage is there with regard to the existing incumbents. In addition, we have simplified the registration process to enable new vendors to come in. We need to consistently deliver better value for money so that increasing number of indentors get associated with us.
Electronics Bazaar, South Asia’s No.1 Electronics B2B magazine