Trade Deal Gives UK Greater Access to Public Procurement

Chennai: India has given unprecedented access to the UK into the public procurement market, opening up around 40,000 high-value contracts in government departments and PSUs, says GTRI.

UK bidders can participate in contracts of central ministries and departments including transport, green energy, and infrastructure. According to GTRI, the UK has received greater access to the government procurement process compared to the UAE under its deal with India. British firms will be allowed to participate through India’s Central Public Procurement Portal (CPPP) and the GeM platform.

UK-origin goods with just 20 per cent domestic content will be treated as “Class II” local suppliers under India’s Public Procurement Order (PPO), a classification previously reserved for Indian suppliers with 20–50 per cent local content.

“The 20 per cent local content rule allows UK firms to use up to 80 per cent inputs from third countries—such as China or the EU—while still receiving preferential treatment, effectively diluting the benefits that programs like ‘Make in India’ and Atmanirbhar Bharat were designed to protect,” said Ajay Srivastava, founder, GTRI.

India has, however, retained the right to exclude sensitive areas like health, agriculture, MSME procurement, and low-value contracts.

Currently, MSMEs have a quota in government procurement. The trade deal says that if preferential treatment is provided for SMEs, the government should ensure that the measure, including the criteria for eligibility, is transparent.

The access given to the UK could also set a precedent for future FTAs with larger economies like the EU or US, potentially eroding India's ability to use public procurement as a lever for policy goals such as import substitution, domestic capacity-building, and employment generation.