Page 110 - Procurement guidelines for smart sustainable cities - A U4SSC deliverable

On GeM, the filters for selecting goods which are Preferential Market Access (PMA) compliant and
those manufactured by Small Scale Industries (SSI), enables the government buyers to procure
“Make in India” and SSI goods very easily. Easily accessible MIS also enables the administrators
and policy makers to easily and effectively enforce the government regulations on PMA and SSI
sourcing.

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 at least 15-20 per cent, and in some cases even up to 56 per cent.
Demand aggregation for most of the common-use goods and services procured by various Central/
State Government Departments is estimated to result in annual savings to the tune of INR 40 000
Crore (approx. USD 4.8 billion) per annum.

Presently, more than 4 million products and 2 million service providers are available on GeM portal.
Transactions for more than 110 000 Crore have already been processed through GeM. The GeM
Portal has won the BusinessLine Changemaker Award for Digital Transformation in March 2020.

Challenges

The GeM team concedes that some challenges remain. Although efforts are being made to make
GeM a Unified Procurement System for goods and services procurement, there are multiple portals
in central government departments such as the defence procurement portal, the Indian Railways
e-Procurement System, which could limit GeM’s effort to achieve its mandate as the National Public
Procurement Portal and provide the benefit of economies of scale and efficiency.

GeM also faces a bit of a challenge in getting all central organizations to comply with Rule 149 of
the General Financial Rules (GFR) 2017, which mandates that all common-use goods and services
that are available on the GeM portal should necessarily be procured on the platform.

Sellers noted that on-boarding onto the portal requires significant computer knowledge, and this
is sometimes a challenge. However, GeM personnel are very proactive in offering help to onboard.

Figure 34: Promotional image outlining the benefits of GeM

96 Procurement guidelines for smart sustainable cities | May 2023