The Government e-Marketplace (GeM) is an online platform for public procurement in India. It aims to increase transparency, efficiency, and speed in the purchasing process for various government departments, organizations, and Public Sector Units (PSUs). It provides tools for e-bidding, reverse e-auction, and demand aggregation. GeM has replaced the Directorate General of Supplies and Disposals (DGS&D) and is a contactless, paperless, and cashless online marketplace.
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- Public Works: GeM is in the early stages of exploring the inclusion of public works contracts, which are agreements for the construction, renovation, or maintenance of public infrastructure like roads and buildings. These contracts, awarded by central, state, and local governments, are valued at lakhs of crores of rupees annually.
- Global Tenders: GeM is set to launch a global tender feature by the end of the current fiscal year. This will allow government ministries and departments to procure goods and services from international vendors, aligning with India’s free trade agreements (FTAs). This initiative is expected to increase competition in the bidding process.
- “Make in India” Preference: The Public Procurement (Preference to Make in India) Order, 2017, gives preferential treatment to domestic suppliers in government procurement based on their domestic value addition (DVA).
- Class-I Suppliers: Have over 50% DVA and receive the highest preference.
- Class-II Suppliers: Have 20-50% DVA and can bid for domestic tenders.
- Non-local Suppliers: Are excluded from state and local-level procurement.
Market Impact
India’s government procurement market is estimated to be nearly $600 billion annually, which is approximately 15% of the country’s GDP. By leveraging FTAs, GeM is expanding access for international firms to this market. The UK, for example, is the second country after the UAE to gain access, allowing its firms to participate in tenders above ₹200 crore.
