The GeM Maker

As the CEO and President of National e-governance division, Radha Chauhan, a Uttar Pradesh-cadre IAS officer, got a challenging assignment in 2016. She was asked to find out whether an Amazon-like e-marketplace could replace the traditional government procurement systems and operations of the century-old Directorate General of Supplies and Disposals (DGS&D). By March 2016, Chauhan's team delivered a model that retained all checks and balances, including regulatory compliances and lowest bid requirements. In August that year, it was launched by DGS&D as its e-procurement initiative. Later on, DGS&D was wound up and Chauhan was asked to head the Government e-Marketplace (GeM), a new special purpose vehicle that would carry out DGS&D's operations.

GeM started by offering e-procurement of computers, tablets and smartphones and also cab services, but Chauhan soon pushed its growth. "We hit Rs 40 crore-plus in March 2018, and now, it is about Rs 50 crore," she says. From about 400 categories a year ago, GeM now deals in 1,100 categories and over four lakh products.

DGS&D had, in its entire existence, a maximum number of 3,500 vendors while GeM has already brought in 1,00,000 and over 40 per cent of the transactions involve micro and small vendors. Unlike DGS&D, which was primarily a Central government agency fixing tender-based pricing for products, GeM is a common platform for all public sector, state and central government purchases. So far, 24 states and Union Territories have signed MoUs with GeM to align their procurement systems with the e-marketplace.

"Earlier, every department had to float a tender and evaluate offers, which would take five-six months. Now it hardly takes two hours. Also, sellers don't have to recreate their bids whenever departments post their requirements. A one-time registration is enough. While individual identity is verified through Aadhaar, the system is integrated with PAN for financial networth. The linkage extends to corporate filings in the MCA21 database and tax information available with the GSTN network for efficiency," says Chauhan.

She also thinks `3-4 lakh crore out of the `24 lakh crore worth of government's annual purchase of goods and services can be routed through this platform. "On an average, there is a 25 per cent saving in procurement costs. When we hit a transaction target of `1,00,000 crore (in the next three years), the amount we will be able to save can fund a national scheme.