Questions/Answers

GeM, a pure marketplace based, National Procurement Portal of India, was launched by the Government, to address the need for higher transparency, removal of inefficiencies owing to a complex policy landscape, manual inconsistent processes and long lead times. GeM is an online, paperless and contactless end-to-end marketplace that provides an open, efficient, inclusive, standardized, reliable & transparent solution for all public procurement needs, for both goods and services, across the country. The platform was launched on 9 Aug 2016 and has achieved significant scales in operations with strides towards optimizing public procurement. With a cumulative Gross Merchandise Value (GMV) of approximately $ 2 Billion in 2 years of its operations, being offered by 161,597 plus sellers through a kitty of 627,760+ products and services to more than 30,350 public procurement offices; while delivering an average saving of 25%. Out of the $ 2 Billion GMV, 46% of the order value have been fulfilled by micro, small and medium enterprises and enterprises led by women & self help groups. Over the next 5-7 years GeM is expected to achieve a GMV of approximate $ 75 Billion equivalent to 4-5% of India’s GDP. All states and UT are transacting on GeM.

Prior to GeM, India’s public procurement landscape was marred with limitations & inefficiencies related to coverage, price, time consuming & heavily manual processes, complex policy landscape etc. GeM in its short period of existence has innovated, transformed and streamlined the public procurement in India. It has provided an open, inclusive, transparent, integrated, cashless, contactless and paperless portal to public offices and sellers across the country, to transact 24 X 365 days a year. GeM has provided the policy makers, industry and other stakeholders real time visibility into the process and procurement data for decision making; something which was missing earlier.

GeM is enhancing the value society by facilitating productivity, driving economic growth, job creation, fostering integration into value chains and markets, reducing corruption thereby providing equal opportunity and ease of doing business in the public procurement space for both goods and services to all. Leveraging ICT, GeM brings about the required policy changes and establishes co-operation across multiple stakeholders, to build an enabling environment. GeM provides a fair and equal opportunity to the smaller sellers and service providers ranging from SME, Start-ups, women entrepreneur and Self Help Groups. Paperless aspects of the initiative significantly contributes to “Green” goal of SDG.

Prior to GeM, the public procurement space in India was mostly dominated by a limited number of sellers having location and size advantages. The system was opaque, from participation and information availability perspective. For smaller players, getting a foot in into public procurement was near impossible. Long term rate contracts further ensured a close grouping of buyers and sellers deterring new participation. As against 3500 odd sellers registered on rate contract, GeM has more than 1,63,000 sellers. With the advent of GeM, sellers from SME, Start-ups and Self Help Groups(SHG) got fair and equal opportunity to participate in public procurement. Most of these SHGs are run by the women from semi rural and rural areas. By virtue of being an online platform, GeM demolished the barriers of location and size. The equalizing and positive impact of GeM is evident from the fact that, more than 26% of the sellers on GeM are MSMEs, which contribute to 46% of the total value of transactions of which 19% were awarded to sellers having turnover of less $72,000 . GeM has helped standardize not only the policy and practices of public procurement, but also the specifications and feature sought in public purchase.

GeM brings together multiple first-in-class innovations in Indian e-governance scenario: a. First in class, market based procurement platform for both goods and services. b. Advanced analytics enabled across user levels. c. Process innovation across streams- standardized catalogue management system to payment assurance mechanism (pool account) d. Embedded compliance across the marketplace and buyer levels- ranging from local schools to defence agencies and banks. e. Objective and automated rating for not only sellers but also for the buyers, which is a first of its type feature. f. Multi-domain integrated, contactless and end to end system. g. Market-based dynamic price reasonability tool.

GeM marketplace is a novel and replicable concept and perhaps the only platform among its peers which offers both goods and services. The innovation reflects in the design and technology framework, wherein a standard catalogue driven marketplace leverages an open-source based, inter-operable and API driven microservices architecture. GeM has deployed cutting edge and emerging technologies, including analytical tools for decision support and has also synergized it for establishing competitiveness by way of cost incurred by the government. By mapping legacy data to open market data, the AI tools provide for convenient to use, price reasonability data to its buyers.

More than 30,000 public offices, straddling national agencies to local schools and bodies, across the length and breadth of the country have already been subsumed on GeM. The value proposition of GeM drew 28 of the 36 States and UTs (the administrative units below federal level) into signing MoUs with GeM for their procurement needs, while inching towards expunging their related current modes and methods. All of these 36 States and UTs are transacting on GeM. Multilingual support in helpdesk and content delivery have facilitated easy adoption and high level of localization of GeM.

Management and technical resources were sourced from Government’s internal resources, and the initial two versions were developed completely inhouse. Currently GeM has adopted a Public Private Partnership approach and selected a managed service provider to assist in developing, operating and maintaining the platform and its business activities, on a transaction based model. The overall administration and operations of the platform, is handled by a lean team at the Special Purpose Vehicle of Government of India.

GeM is a major milestone in India’s transition from a Knowledge Economy to an Inclusive Information Society. While the e-mode based, paperless end-to-end procurement reduces the carbon footprint, the open and inclusive marketplace provides equal opportunity to all to participate in the public procurement space in India. GeM’ s capacity building strategy, simple and open contactless processes ensures that even a first time technology user be it a small and medium enterprises or a start-up or self help groups, across rural and semi-rural geographies, are able register and reap the benefits by selling to the government buyers. GeM is driving economic growth and enabling job creation by promoting indigenization through Make in India program. Transactions on platform have resulted in almost 25% savings for the exchequer. In the long run, the saving through GeM is expected to reach around 1% of the country’s GDP, which could be channelized for other development purposes. From a business model perspective, the platform is self-sustainable as it operates on a monetization model.

Yes

The platform has undergone the following external evaluation: 1. South Asia Procurement Innovation Award in 2016 (http://documents.worldbank.org/curated/en/341581491849541878/pdf/114154-WP-71p-PUBLIC-P162102-WB-Award-Book.pdf) http://blogs.worldbank.org/governance/how-government-e-marketplace-revolutionizing-procurement-india 2. Standardisation Testing and Quality Certification (STQC) https://assets-bg.gem.gov.in/resources/pdf/stqc.pdf 3. Dipstick Impact Assessment, Jan 2017– by Pradeep Valsangkar, Wg. Cdr. (retd), Senior Consultant World Bank and reviewed by Prof Surinder Batra (IT & Analytics Area), Institute of Management Technology, India

1. For South Asia Procurement Innovation Award in 2016 – as per award criteria 2. For STQC – As per Ministry of IT followed guidelines 3. Dipstick Impact assessment – survey on impact indicators

1. For South Asia Procurement Innovation Award in 2016 – GeM was a winner in its category 2. For STQC – GeM cleared the functionality and vulnerability assessment 3. Dipstick Impact assessment - Buyers and sellers found the GeM portal very easy to use and agreed that the portal helped bring in transparency, increase competition, reduce cycle time in the Government procurement process. GeM has led to Digital Governance through streamlining Government Procurement. GeM has a potential to standardize service procurement

The DNA of GeM revolves around participation, collaborative and empowerment. Multiple Government organizations, Industry associations, Banks, SME vendors and other stakeholders have partnered together to contribute and enrich the offerings on the platform. Inclusion of product and services on marketplace involves harmony between demand and supply side entities through a consultative approach, achieved though focus group discussions, consultative forums etc. OEMs for the first time are active stakeholders in the public procurement space and help maintain the sanity of the marketplace through oversight on prices, specification and the genuineness of resellers at the entry point itself. The system has simplified the processes of registration, transaction, contracting and payments through easy to use and integrated realtime interface. To achieve this seamless interface, GeM has collaborated with multiple domain and government agencies. GeM organises special events for stakeholders’ engagement, including state and local government, innovators etc on a continuous basis. One such initiative, ‘The National Mission on GeM’ was organized in the month of September-October 2018 to leverage the ideas across the stakeholder landscape ( Government, sellers, Industry forums, international organizations like WB & ADB, academia, women entrepreneurs) for defining its future roadmap.

1. Enhanced adoption cannot be sustained without massive and continuous capacity building. 2. Standardization of buyer requirement and achievement of market maturity is imperative in long run. 3. Use of AI to bring in more automation, greatly improves customer experience and helps in compliance management. 4. Stakeholders needs to disrupt and transform their business models and processes appropriately, in the spirit of openness and trust to bringing in synergy. 5. Full transparency also needs to be safeguarded against potential cartelization as also provide space for commercial privacy.