• The defence ministry said it achieved a significant milestone by becoming the only ministry to cross the figure of Rs 1 lakh crore Gross Merchandise Value (GMV) of procurement through Government e-Marketplace since its inception.

• In the current fiscal year, the defence ministry has placed orders worth Rs 46,000 crore approximately on the GeM as on February 13.

• The order value of the ministry in 2022-23 was worth Rs 28,732 crore while it amounted to Rs 15,091 crore in 2021-22.

• Over 19,800 defence buyers from across the country have placed over 5.47 lakh orders on the GeM. 

• About 50 per cent of these orders were awarded to the Micro and Small Enterprises (MSEs), aligning with the core value of maximising social inclusion in public procurement market and bolstering India’s economic growth towards ‘Aatmanirbharta’.

Government e-Marketplace (GeM)

• Government e-Marketplace is a government-owned Section 8 company set up under the aegis of department of commerce for procurement of goods and services by central and state government organisations.

• Public procurement involves purchase of goods and services by governments with an aim to not only carry day-to-day tasks but to also create social and economic infrastructure.

• In India, public procurement accounts for roughly 20 per cent of the GDP and therefore, an efficiently run public procurement process is critical to the  economy.

• In order to improve transparency of decision-making in the public procurement process and to reduce malpractices, the Union government decided to set up an online marketplace for public procurement.

• GeM is the national public procurement portal offering end to end solutions for all procurement needs of central and state government departments, PSUs, autonomous institutions and local bodies. 

• A special purpose vehicle (SPV) by the name of Government e-Marketplace (GeM SPV) was set up as the national public procurement portal.

• Since its commencement on August 9, 2016, GeM has transformed public procurement in the country by leveraging technology and making procurement contactless, paperless, and cashless.

• The platform reduces manual process inefficiencies and human interventions in procurement and enables increased coverage, access, and efficiency of faceless, standardised public procurement.

• It provides the tools of e-bidding, reverse e-auction and demand aggregation to facilitate the government users, achieve the best value for their money.

• The purchases through GeM by government users have been authorised and made mandatory by the ministry of finance by adding a new Rule No.149 in the General Financial Rules, 2017.

• The portal provides a wide range of products from office stationery to vehicles. Automobiles, computers and office furniture are some of the major product categories. Services, including transportation, logistics, waste management, web casting and analytical, are listed on the portal.

• GeM has crossed a staggering value of Rs 3 lakh crore in Gross Merchandise Value (GMV) in the current financial year.

• GeM has over 67,000 government buyer organisations and over 60 lakh sellers and service providers and they have listed more than 32 lakh products in over 11,000 product categories and 320 service categories.

Functioning of GeM:

• GeM helps governments achieve the best value for the taxpayers’ money by carrying out efficient public procurement using tools such as e-bidding, reverse e-auction and demand aggregation.

• GeM has provided the government procurement agencies an option to select MSME vendors for procurement which has helped MSMEs to significantly increase their sales.

• Any procurement up to Rs 25,000 can be directly purchased from available vendors on the GeM if it meets the required quality, specification and delivery period.

• For procurement above Rs 25,000, purchases have to be made following procedures such as price comparison, bidding or reverse auction, where the criterion of the lowest price among available suppliers on the GeM has to be followed to ensure price efficiency.

• A chat-bot called GeMmy has been launched to assist the vendors and buyers.

Impact of GeM

• The transparency, efficiency and ease of use of the GeM portal has resulted in a substantial reduction in prices, in comparison to the tender, rate contract and direct purchase rates.

• GeM has drastically brought down waiting time for buyers and ensured timely payments to the sellers. 

• It has facilitated efficient transmission of policy intent by implementing the ‘Make in India’ policy and the MSE policy on its portal and providing impetus to the vision of ‘Aatmanirbhar Bharat’ and also promoting local products through the ‘Vocal for Local’ initiative.

• GeM has enabled various modes of procurement and made available various analytical tools to facilitate buyers to make informed decisions while making procurement. 

• A public procurement system which is completely transparent not only improves the government functioning but also encourages greater participation from private firms in the bidding process.

• The portal provides an opportunity to MSMEs to scale up business and increase sales.

• GeM has created a Unified Procurement System for the country by bringing the functionalities of the Defence Public Procurement Portal, the Central Public Procurement Portal and its sub-portals onto GeM to provide a single user experience.

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