Government e-marketplace for Public procurement saves Rs 40,000 crore annually

New Delhi, Jan 24 (KNN) The average prices on Government e-marketplace (GeM) for Public procurement are lower by atleast 15-20%, and in some cases even upto 56% and would also result in savings of Rs 40,000 crore annually for the exchequer.

GeM aims to transform the way in which procurement of goods and services is done by the Government Ministries/Departments, PSUs, autonomous bodies etc.

FM Jaitley in his Budget speech for FY 2016-17, announced setting up of a technology driven platform to facilitate procurement of goods and services by various Ministries and agencies of the Government.

DGS&D with technical support of NeGD (MeitY) has developed GeM portal for procurement of both Products & Services. The portal was launched on 9th August 2016 by the Commerce & Industry Minister.

Procurement on GeM has been authorized by GFR by adding Rule 141A (DoE OM dated 3rd May 2016). Presently more than 7400 products in about 150 product categories and hiring of transport service are available on GeM POC portal.

Transactions for more than Rs 140 Crore have already been processed through GeM.

GeM is a completely paperless, cashless and system driven e-market place that enables procurement of common use goods and services with minimal human interface.

Being an open platform, GeM offers no entry barriers to bonafide suppliers who wish to do business with the Government. At every step, SMS and e-Mail notifications are sent to both buyer, his/her head of organization, paying authorities as well as sellers.

Online, cashless and time bound payment on GeM is facilitated through integration with PFMS and State Bank Multi Option System (SBMOPS); web-services integration is being extended to payment systems of Railways, Defence, major PSUs and State Governments.

Direct purchase on GeM can be done in a matter of minutes and the entire process in online, end to end integrated and with online tools for assessing price reasonability.

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

The average prices on GeM are lower by atleast 15-20%, and in some cases even upto 56%.

Demand aggregation for most of the common use goods and services is estimated to result in annual savings to the tune of Rs 40,000 Crore per annum.

If pursued to its logical conclusion, GeM would eventually emerge as the National Public Procurement Portal, keeping in tune with the Global best practices; most of the OECD countries, like USA, South Korea, UK, Singapore etc, have a single NPPP and as a result annual savings of billions of dollars are made in public procurement, besides giving a fillip to the domestic industry.