Green Public Procurement in India

The use of public procurement as an instrument to influence the market trends in favour of environmentally and socially responsible products and services is relatively a new concept in India. However, different elements of environmental sustainability feature in and influence the procurement choices across governments and suppliers. The setting is conducive for adopting sustainable purchasing as an environmental policy instrument in a more structured way. Regulatory and Policy Frameworks Public procurement in India has been estimated to constitute about 30 per cent of GDP.There is no procurement law to date and public procurement in India is governed through government policies. General Financial Rules (GFR) lays down basic principles of efficiency, economy, transparency, fairness and equitability and promotion of competition in procurement to be followed by central government departments/agencies. There is provision of judicial review of executives decision to reduce arbitrariness. Recent Developments on Green Public Procurement In 2011, The Ministry of Environment and Forest, Government of India nominated a committee to formulate guidelines on Green Public Procurement. The committee has recommended legislation to establish the necessary provisions and institutional arrangement for encouraging central government to procure greener products and services. Recently, the Government of India has introduced Draft Public Procurement Bill-2012, which states evaluation criteria shall relate to the subject matter of procurement and may include - (a) the price; (b) the cost of operating, maintaining and repairing goods or works, the characteristics of the subject matter of procurement, such as the functional characteristics of goods or works and the environmental characteristics of the subject matter. This law, once enacted, would provide legitimacy to a procurers decisions of integrating environmental concerns in public buying. Ecolabels and Environmental Standards Since its release in 1996, ISO 14001 has emerged as the leading voluntary system for certifying a firms commitment to environmental management. However, the use of ecolabel and environmental standards in procurement of products, works and services is not very common. Ecomark, the Indian ecolabel for products, was introduced in 1991 but the label has so far had a low uptake from both manufacturers and buyers. Challenges and Looking Ahead The critical issues facing greater uptake of GPP in India include: limited political motivation; the absence of a clear legal framework and guidelines; a lack of knowledge to avoid legal and technical problems during the procurement process (inclusion, evaluation and monitoring); limited knowledge of and experience in using tools such as LCC and LCA; a dependency on experts to define specifications; and the perceived higher costs of greener products. Vendors advocate for SPP/GPP to be implemented in a transparent way with sufficient time to react; that Intellectual Property Rights are respected and that product quality is guaranteed by third party certification. Implementation of SPP/GPP in practice would require not only laws and guidelines, but also a change in attitude amongst producers and consumers. A shift towards understanding that spending public money is an opportunity to directly foster sustainable development and innovation is needed. This calls for capacity building of all stakeholders. Equipping public buyers with the know-how on how to include sustainability requirements into their purchasing processes would be a key to successful implementation of SPP/GPP.

CHANDAN KUMAR Indian railways