Government targets 100% procurement by ministries, CPSEs through GeM portal by end of FY23

Source: Financial Express, 24 July 2022

Ease of Doing Business for MSMEs: The government has now set a target of procuring all of its goods and services through the public procurement portal Government e-Marketplace (GeM). It aims to make 100 per cent procurement through GeM by the end of the current financial year and 75 per cent by August 15, according to a statement by Commerce Ministry. 

Chairing a review meeting of GeM on Friday, Commerce Minister Piyush Goyal “emphasized that Prime Minister has set a target of 75 per cent procurement to be made through GeM by the 15th of August and 100 per cent by the end of the current financial year,” the statement said. Over 50 central government ministries and 50 central public sector enterprises (CPSEs) were invited to share their feedback on buying from GeM which was launched in August 2016.

While the current share of the government’s procurement from GeM could not be ascertained but Commerce Secretary BVR Subrahmanyam in August last year noted that the portal tapped only 5 per cent of the total government purchases of around Rs 20 lakh crore a year even as it has helped save 10 per cent in cost — around Rs 10,000 crore in a cumulative procurement of Rs 1 lakh crore in five years. The secretary was speaking at the CII’s National Public Procurement Conclave.

Goyal further noted that procurement data generated on GeM will help the government in improving transparency and efficiency in public procurement. Moreover, the aggregation of demand via the procurement model through a single portal will also help in reducing the cost of procurement for the buyers. “With collective wisdom and collective efforts of all stakeholders, GeM can well become the largest marketplace for public procurement in the world,” he added.

The gross merchandise value (GMV) of GeM has jumped 178 per cent from Rs 38,280 crore in FY21 to Rs 1,06,760 crore in FY22. The portal is aiming to double its turnover to Rs 2 lakh crore in FY23. “This growth of Rs 1.06 lakh crore is 17 times more than the first year when GeM came into being and almost 55 per cent of the cumulative (turnover) in the previous financial (year). This shows excellent growth from MSMEs, PSUs, and states,” GeM Chief Executive Officer Prashant Kumar Singh had said at MSME Business Conclave organised by Financial Express Digital in June this year.

GeM has around 61,440 government buyer organizations and about 47.99 Lakh sellers and service providers with a listing of more than 41.44 lakh products and 1.9 lakh services.

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