What a Make in India procurement actually asks of a server vendor

A Make in India server procurement asks the bidder to establish the measured local content of the exact configuration offered, declare its PPP-MII supplier class, identify where Indian value addition takes place and retain evidence that can withstand verification. Assembly in India, an Indian invoice or an Indian-owned brand does not by itself settle the classification. There is no general Make in India certificate issued by the Government of India. For procurement below the applicable Rs 10 crore threshold, the process begins with bidder self-certification. Above that threshold, certification by the prescribed auditor, cost accountant or chartered accountant is required. The tender conditions and applicable product notification must be read together. PPP-MII classification applies to the offered item PPP-MII classification belongs to the goods, services or works offered in a particular procurement. It is not a permanent status granted to a company, brand, registered office or factory. An Indian server manufacturer may therefore offer one configuration as a Class-I local supplier and another as Class-II. A change from one motherboard, GPU, drive or power-supply arrangement to another can alter the imported-content value and, consequently, the classification. Class-I local supplier A Class-I local supplier meets the local-content threshold the applicable order sets for the offered item. A nodal Ministry may prescribe a different minimum for a particular product, so the relevant notification decides the threshold for your tender rather than the general figure. Class-II local supplier A Class-II local supplier has local content above the non-local threshold but below the applicable Class-I threshold. What that means for purchase preference is set by the PPP-MII Order as it stands on the bid date, read together with any sector notification the tender names — so take the class definitions and the preference rules from those documents rather than from a summary. Non-local supplier An offer below the Class-II threshold is treated as an offer from a non-local supplier. Such suppliers are normally eligible only where a Global Tender Enquiry has been issued, subject to the tender conditions and other applicable procurement restrictions. These classifications and their default thresholds are set out in the DPIIT Public Procurement (Preference to Make in India) Order . Local content is a value calculation, not a factory description Under the general DPIIT method, local content is the value of the item excluding net domestic indirect taxes, less the value of imported content including customs duties, expressed as a percentage of the item value. This calculation has several consequences for server bids: An imported component remains imported content when it is purchased from an Indian distributor or reseller. Licence fees, royalties and technical charges paid outside India cannot be counted as local content. Repackaging, refurbishing or rebranding an imported machine does not make it locally manufactured. A reseller is required to obtain OEM evidence of country of origin. For a contract containing multiple items, local content is calculated on a weighted-average basis. A bidder cannot use one favourable line item to classify the complete contract. The commercial invoice is therefore not sufficient evidence of component origin. A CPU, GPU, DIMM or drive supplied through an Indian channel does not become domestic merely because the billing entity and transaction are in India. The declaration must match the quoted server A useful local-content declaration identifies the complete quoted configuration, including the server model, motherboard, processor count, memory population, storage devices, RAID or HBA cards, network adapters, GPUs, power supplies, operating-system licences and other deliverables. For example, a declaration for a 2U dual-socket server with 16 DIMMs, two boot SSDs, eight data drives, a RAID controller and dual power supplies cannot automatically be applied to a 4U GPU system containing eight accelerators, additional NICs and a different motherboard. The imported-content values and qualifying manufacturing stages are materially different. The same discipline applies to bid variants. If a tender permits multiple CPUs, drive capacities or GPU models, the vendor should either calculate each offered configuration separately or establish a controlled method that reconciles the final supplied configuration with the declared percentage. MeitY prescribes a server-specific BOM mechanism For local-content assessment under the server mechanism, MeitY treats a server as including the motherboard, CPU, RAM, HDD or SSD, SMPS, chassis, connecting cables, firmware and operating system. The value of an input enters the domestic BOM only when the applicable manufacturing or value-addition condition is met. The relevant mechanism is contained in the MeitY notification covering electronic products and server BOM treatment , read with the later amendment for add-on controllers. Motherboard, CPU and GPU treatment The server motherboard qualifies under the notified mechanism where PCB assembly and testing are carried out in India. The prescribed treatment can include the value of semiconductors and CPUs or GPUs while excluding the bare PCB value, subject to PCBA through the SMT process being performed in India. This is particularly important for GPU servers. Installing and burn-in testing an imported finished GPU in India does not, by itself, make the GPU domestic. Any claimed treatment of its value must follow the MeitY mechanism and be supported by the corresponding motherboard or PCBA manufacturing records. Memory modules Memory enters the domestic mechanism through PCB assembly and testing using the prescribed treatment for chips, other components and the bare PCB. Fitting finished imported DIMMs into a server is system integration, not domestic manufacture of the memory module. HDDs and SSDs The stated qualifying stage for HDDs and SSDs is assembly and testing in India from parts and components. Installation of a finished imported drive in a chassis should not be treated as the same manufacturing stage without records establishing compliance with the notified condition. Cabinet and SMPS The cabinet must be manufactured domestically. For the SMPS, domestic assembly and testing are required, and a minimum share of the value of its parts and components must itself be domestically manufactured — the applicable MeitY notification sets that share, and it is the figure a certificate has to be written against. A declaration that only says the chassis and power supply were sourced in India does not establish these conditions. The buyer should seek the manufacturing location for the cabinet and a cost build-up or supplier certification for the SMPS condition. Add-on controllers The MeitY amendment dated 12 October 2023 brought add-on controllers into the server BOM mechanism. Their qualifying treatment is based on domestic PCB assembly and testing, and their combined contribution to the domestic BOM is capped — the amendment states the cap, and a claim above it will not survive scrutiny. The amendment is available through the MeitY server BOM notification . RAID cards, HBAs and network controllers should therefore be identified separately. Their value cannot be used without limit to increase the declared local-content percentage. Final assembly, testing and Indian intellectual property Final server assembly and testing in India are recognised activities. Indian-resident intellectual property may also receive the treatment prescribed in the notification. Neither provision removes the need to test each principal input against its applicable manufacturing condition. Domestic integration, firmware loading, system testing and burn-in are genuine Indian value addition. They should be declared accurately, without converting the full value of imported finished inputs into domestic value. What the bidder must submit with the bid A Class-I or Class-II bidder must state the local-content percentage, certify that the offered item meets the claimed class and provide the location or locations at which local value addition occurs. The bid-stage declaration should contain enough detail to connect it to the commercial and technical offer. At minimum, the buyer should expect: Bid and tender reference: the bid number, schedule, lot and relevant line item. Product identity: the make, model, form factor and exact offered configuration. Supplier class: Class-I or Class-II, as applicable. Measured percentage: the calculated local-content percentage rather than only a statement that the threshold is met. Value-addition locations: the names and addresses of the facilities performing the claimed activities. Authorised signatory: the signatory required by the tender and the applicable threshold. Procurement above Rs 10 crore For procurement exceeding Rs 10 crore, a company must provide certification from its statutory auditor or cost auditor. Where the supplier is not a company, certification may be issued by a practising cost accountant or practising chartered accountant. The revised Order also provides for certification during execution of contracts above Rs 10 crore. Where certification during execution is not possible, it may be submitted after completion within the period accepted by the procuring entity. Tender writers should reproduce the correct signatory and submission stage because bid-stage and execution-stage requirements are not identical. No central Make in India certificate exists The Government of India does not issue a general certificate giving a vendor permanent Make in India status. This is also stated in the Department of Expenditure Manual for Procurement of Goods . A document titled “Make in India Certificate” is therefore only a declaration. Its value depends on whether it identifies the offered item, states the percentage and class, carries the proper certification, uses the applicable calculation and is backed by records. Verification pack a server buyer should request Not every document below is expressly required in every tender. Together, however, they form a practical verification pack for evaluating a server local-content claim. Configuration and calculation records A configuration-specific declaration carrying the exact make, model and offered BOM. A component-wise local-content worksheet reconciled with the technical and commercial offer. The item value, imported-content value, local-content value and resulting percentage. A weighted-average worksheet for contracts containing servers, storage, switches, racks, software, services or other line items. A separate statement of foreign licence fees, royalties and technical charges. A list of directly imported components and imported components purchased through Indian distributors. Manufacturing evidence Addresses of the motherboard or PCBA facility, system integration facility, cabinet manufacturer, SMPS facility and other value-addition locations. Evidence of domestic SMT, PCB assembly and testing for the motherboard and any other PCB assembly claimed under the domestic BOM. Manufacturing and test records for memory modules, HDDs, SSDs and add-on controllers where their values are claimed. Evidence that the cabinet is manufactured in India rather than only painted, labelled or integrated locally. The SMPS cost build-up or supporting certification required to establish the domestic parts-and-components condition the notification sets. Final assembly, serial-number, quality-control and burn-in records for the supplied systems. Origin and commercial evidence OEM country-of-origin certificates for products supplied in a reseller capacity. Purchase and import records supporting the values used in the calculation. Invoices and supplier declarations that distinguish Indian manufacture from Indian distribution. Auditor or accountant certification where the procurement value and applicable provision require it. Control substitutions after award A compliant bid can become difficult to verify if components are substituted during delivery without recalculating local content. Server tenders should therefore connect substitution control with the PPP-MII declaration. If the vendor changes the motherboard, processor, GPU, memory source, drive model, controller, NIC, SMPS or software licence, the buyer should require confirmation that the revised configuration continues to meet the declared supplier class. Where the change affects imported value or a qualifying manufacturing stage, an updated worksheet and certification should be submitted before acceptance. This requirement is useful even when the substitute component meets or exceeds the technical specification. Technical equivalence and local-content compliance are separate tests. Common declarations that need further evidence “The server is assembled in India” This establishes the location of system integration, not the origin or qualifying treatment of every BOM input. The buyer should ask for the measured percentage and component-wise basis. “All components were purchased in India” Indian procurement does not establish Indian manufacture. Imported items supplied by an Indian distributor remain imported content. “The company is a Class-I manufacturer” Class-I applies to the offered item or contract. The declaration should identify the exact configuration and tender line item. “The product has a Make in India certificate” There is no general government-issued certificate. The buyer should inspect the issuing party, calculation, percentage, signatory, product identity and supporting evidence. “The complete GPU value is local because integration is in India” Installation and testing in India do not automatically convert an imported finished accelerator into domestic content. The vendor must show how the claimed value complies with the MeitY server BOM mechanism. How to write the tender requirement The tender should specify the applicable PPP-MII Order, the relevant MeitY server notification, the minimum supplier class, the certification threshold and the stage at which supporting records may be called for. It should also state whether the local-content calculation applies to each line item, each lot or the complete contract on a weighted-average basis. A practical tender clause should require the bidder to: Declare the local-content percentage and PPP-MII class for the exact offered configuration. Identify every location at which claimed local value addition takes place. Provide self-certification or prescribed professional certification, as applicable. Submit a component-wise worksheet when requested by the procuring entity. Distinguish domestically manufactured inputs from imported inputs purchased through Indian channels. Retain manufacturing, origin and value records for verification. Recalculate and recertify local content after any material BOM substitution. Accept action under the tender and applicable procurement rules if a declaration is found to be false. The clause should not invent a central registration or certificate that the policy does not provide. It should ask for measurable declarations and verifiable records. What buyers should establish before technical evaluation Which PPP-MII revision and product-specific notification apply to the procurement. Whether a nodal Ministry has prescribed a Class-I threshold above the general default. Whether Class-II suppliers are eligible to participate under the bid conditions. Whether the Rs 10 crore certification provision applies to the procurement. How local content will be calculated for lots containing hardware, software and services. Which documents must accompany the bid and which may be requested during verification or execution. How substitutions, partial deliveries and final supplied configurations will be reconciled with the declaration. These points should be settled in the tender rather than left for interpretation after opening the bids. Make in India evidence for NetBytes systems NetBytes servers, GPU and AI systems, storage arrays and related machines are designed, built, burn-in tested and supported in India. For procurement purposes, however, the PPP-MII class still has to be determined for the configuration and contract being offered. An Indian manufacturing operation is relevant evidence, but it does not replace the configuration-specific calculation. Government and enterprise buyers can review our approach to tender documentation at government procurement , examine the available hardware categories under products , or send a bid specification through contact for configuration and documentation review. This is a description of how the mechanism works, not a citation of the numbers in force today. Procuring entities and bidders should take the applicable notification, threshold and certification wording from the tender and from the current published orders on the bid date.