Separate company needed to operate Govt e-Marketplace: Com Min
The Dollar Business Bureau
The Commerce Ministry plans to form a separate company for the management of government e-Marketplace (GeM), a platform for the Central Government departments to source office supplies from.
In an initiative to make procurement of goods and services by the government transparent, the NDA regime had announced the creation of an online platform for public procurement in Budget 2016-17. Developed jointly by Directorate General of Supplies and Disposal (DGS&D) and National e-Governance Division (NeGD), GeM began full-fledged operations from August 2016.
As of January 2017, the government is reported to source more than 7400 products in 150 different categories from the GeM portal.
The cashless and paperless public procurement mechanism is aimed at making the Rs. 10,000 crore annual government procurement activity more efficient and digitized.
The Ministry is of the opinion that the growing functions and size of the online marketplace, exclusively serving to fulfill the needs of the central government, warrants an autonomous management body for quick decision making in the matters of finance and recruitment. The company formed for this purpose would be owned by the government.
Recently, the government mandated procurement of supplies for all govt departments from GeM. DGS&D is looking at expansion of services to include plumbing, cleaning and digitisation of government records.
In the near future, the practice of e-procurement will also be adopted by the state governments. The public procurement project has revamped the DGS&D and boosted the Indian e-commerce sector, which is expected to grow ten fold in the next 5 years buoyed by increasing smart phone penetration and better rural connectivity.
Through aggregation of demand across different ministries and departments, leading to economies of scale, GeM has brought down operational costs for the Government of India. The online procurement mechanism has made prices more competitive, compared to other traditional methods of tenders or direct purchase.