'E-portal for govt purchases will save Rs 40k cr annually'

The online portal launched for government purchases of goods and services would result in savings of Rs 40,000 crore annually for the exchequer, the Commerce Ministry said today.
"Demand aggregation for most of the common use goods and services is estimated to result in annual savings to the tune of Rs 40,000 crore per annum," the ministry said in a statement.
The ministry has launched a 'Government e-Marketplace' (GeM) with the aim to transform the way in which procurement of goods and services is done by government ministries/ departments, PSUs and autonomous bodies.
It said that if pursued to its logical conclusion, GeM would eventually emerge as the national public procurement portal, keeping in tune with the global best practices.

Enlisting benefits of GeM for the government, sellers and the industry, the ministry said the portal eliminates human interface in vendor registration, order placement and payment processing to a great extent.
For procurements of higher value, it said the bidding facility on GeM is transparent and efficient, in comparison to e-procurement systems in vogue within the government sector.

"Very soon, GeM will also start getting feeds from various other public procurement portals in order to ensure that the same item has not been procured at a lesser rate by any other government agency, from the same or a different vendor," it added.

The reasonability of price would be further strengthened by way of integration with GSTN and ICEGATE that will enable the buyer to ascertain the price of an item when it exited the factory gate or when it got imported into the country.
Further, the statement said it is a completely secure platform and all the documents on GeM are e-signed at various stages by the buyers and sellers.
"In addition, SEBI empaneled credit rating agencies are also being used for conducting third-party assessment of suppliers. This would further strengthen due diligence about the veracity of suppliers wanting to do business on GeM," it said.

The ministry said GeM has resulted in a substantial reduction in prices on the portal, 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," it added.