Government e-Marketplace (GeM) can facilitate procurement of work for ministries, departments and government organizations, adding a lucrative business to the goods and services already procured, two government officials apprised of the development.
India’s work purchase accounted for approx. 10 trillion. The move is aimed at improving transparency, reducing costs and cutting down the time required for public procurement in GeM.
As per the draft Cabinet Note for Extension of Special Purpose Vehicle (SPV) of GeM operated by the Ministry of Commerce and Industry, procurement of works contracts through GeM can be kept optional for at least one year, after which it can be may be made mandatory.
“It is proposed that procurement of works contracts through GeM may be kept optional for at least one year after the portal goes live, till the platform stabilizes. The decision to make procurement of works through GeM mandatory will be taken in due course in consultation with the Department of Expenditure,” said the note reviewed by Mint. The cabinet is set to consider the proposal soon.
“Whether centralized procurement through GeM (for procurement of works) should be made mandatory is being studied and a policy decision will be taken,” a senior government official, requesting anonymity, said.
The GeM portal has plans for templates for bid documents in work contract categories, automated pre-qualification assessment, automated commercial evaluation, supplier ratings and past performance statistics, price discovery and benchmarking, and post-contract management. The proposal also requires the addition of 80 new posts besides 66 permanent posts in GeM and a Project Management Unit (PMU) for GeM Works. It gives importance to the fact that India’s total purchases of goods, services and works are estimated to be around 15% to 20% of the country’s GDP. Out of this, procurement of work – which pertains to infrastructure projects such as roads and highway construction – accounts for the least 10 trillion.
The Gross Merchandise Value (GMV) of GeM is expected to cross Rs 1 trillion in the current fiscal, which will help in substantial savings for the government.
The plan is to improve efficiency by bringing in parallel task procurement portals powered by the Central Public Procurement Portal (CPPP), which is also used by ministries like road transport and highways, defence, Uttar Pradesh, Maharashtra and state governments- Indian Oil Corp and Companies like Bharat Heavy Electricals Ltd. Independent portals run by ministries such as Railways, Housing and Urban Affairs and Home Affairs, state governments of Gujarat and Karnataka and CPSEs such as Oil and Natural Gas Corp. will also be tapped. and Hindustan Petroleum Corporation Limited (HPCL). All these will be put under a unified procurement system for all government procurement. Emailed queries to a spokesperson for the Ministry of Commerce and Industry on Saturday afternoon had not been answered until this story was published.
The second government official cited above said the transition to works would be easier than consignment, which saw a move from a manual system of tenders. “CPPP is traditional, and GeM is modern. Tender portal under GeM is optional at present. It is a question of changing the system to a more standardized system,” the official said.
Economic Survey 2021-22 noted that anecdotal evidence has suggested that e-marketplaces have resulted in substantial reduction in government procurement costs, with average prices falling by at least 15-20%, up to 56% .
dilasha.seth@livemint.com
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