Challenges in project procurement

We have a procurement manager who partners with us . The procurement manager also runs the terms and conditions past the legal team to make sure that our interests as a buyer are protected.
As you rightly pointed out Anish, The PM is responsible to ensure that the Project and the Product Scope are well covered in the procurement statement of work.
The PM must understand at a very high level about the contract terms and conditions and the implications and risks of the type of the contract that is being negotiated .

For Example , Fixed Price contracts need an absolute clarity of the Project Statement of Work because there is not much margin of error and the risk to the buyer will increase if there is scope creep because of buyer's Scope not being defined clearly.

The selection of a contract type therefore introduces the element of risk.

Cost Plus type contracts start out as being high risk to the buyer and low risk to the seller. Cost Plus / Time and Materials contracts often require a high degree of auditing on the part of the buyer to make sure that the seller is producing high quality work / filling the time sheets appropriately by justifying the time spent .

PMBOK guide procurement management chapter and the corresponding chapter in Rita Mulcahy's book give a good overview of the procurement management process.