🛒 May 24, Post 002: GeM Celebrates 8th Incorporation Day

NATIONAL
Post Date: May 24, 2025
Thematic Focus: GS2/Governance, GS3/Economy, GS2/E-Governance

🪶 Opening Whisper

In the silence of bureaucracy, a new rhythm emerged — digital, transparent, and inclusive. GeM is not just a platform; it is a quiet reform changing how a nation buys.

🖥️ Key Highlights

• Occasion: 8th Incorporation Day of Government e-Marketplace (GeM), launched in 2016.
• Purpose: Online procurement portal for Goods and Services for Government Departments, PSUs, and Ministries.
• Ownership: Operated by a 100% government-owned SPV under the Ministry of Commerce and Industry.

📈 Impact & Reach

• User Growth:
  • 1.64 lakh buyers
  • 4.2 lakh active sellers
• Product & Service Categories:
  • Over 10,000 products and 330+ services
• MSME & Inclusion:
  • 10 lakh+ MSEs, 1.84 lakh women entrepreneurs, 1.3 lakh artisans, and 31,000 startups
• Big Transactions:
  • ₹5,000 crore for Akash Missile system
  • ₹5,085 crore in vaccine procurement
  • Complex services like drone-as-a-service, wet leasing, CT scans, insurance etc.

🧭 Nationwide Adoption

• Implemented across 36 States and UTs
• Mandatory in 8 states including Maharashtra, Gujarat, Manipur, Himachal Pradesh, Assam, Uttarakhand, Chhattisgarh
• Uttar Pradesh leads in adoption and transaction value

🔍 Challenges Faced

• Low Awareness: Especially in rural India and MSME sectors
• Payment Delays: Despite a digital system, practical lags exist
• Quality Control: Standardization across sellers remains a challenge
• Technical Glitches: Platform speed, crashes, and bugs persist
• Policy Gaps: Department-wise inconsistencies in procurement

🛠️ Government Initiatives for Strengthening GeM

• SWAYATT: Boosting participation of Startups, Women & Youth
• Startup Runway 2.0: Listing opportunity regardless of DPIIT status
• Womaniya: Promotes products made by women SHGs
• SARAS Collection: Handcrafted SHG-based marketplace section
• SC/ST Inclusion: Dedicated onboarding support for entrepreneurs

📚 GS Paper Mapping

• GS Paper 2: Governance, E-Governance Initiatives, Role of Civil Services
• GS Paper 3: Economic Development – Role of MSMEs and Startups

🌌 A Thought Spark — by IAS Monk

When a marketplace becomes a movement, the country doesn’t just spend — it uplifts, includes, and digitizes its soul.

High Quality Mains Essay For Practice :

Word Limit 1000-1200

Reforming Public Procurement: GeM’s Digital Revolution at Eight

Introduction

Public procurement is the lifeblood of government operations, directly influencing infrastructure, welfare delivery, and administrative functioning. Yet, for decades, India’s procurement ecosystem was marred by opacity, inefficiency, and corruption. In 2016, India took a historic leap by launching the Government e-Marketplace (GeM) — a fully digital platform for transparent and efficient public procurement. As GeM completes its 8th year, it has evolved into a symbol of e-governance success, transforming how the government buys goods and services, while empowering micro-enterprises, women, artisans, and startups.

Genesis and Objective of GeM

The conceptual foundation of GeM lies in addressing the challenges of traditional procurement — delayed tenders, restricted vendor access, non-standard specifications, and inflated prices. Envisioned by the Ministry of Commerce and Industry, and launched in August 2016, GeM is operated by a 100% government-owned Special Purpose Vehicle (SPV).

The core objective is simple yet revolutionary:

“To enhance transparency, efficiency, and speed in public procurement while promoting inclusivity and digital governance.”

In 2017, the Ministry of Finance mandated that all central ministries, departments, and PSUs procure through GeM, making it India’s national procurement backbone.

Structural Features and Functional Model

GeM is a one-stop online platform offering:

• End-to-end digital procurement – from registration to payment
• A vast product catalog with 10,000+ categories and 330+ services
• Real-time price comparison, product specification matching, and seller verification
• Tools for audit trails, performance tracking, and data security

Buyers include central ministries, state departments, public sector undertakings, autonomous bodies, and even gram panchayats.

Vendors range from small artisans and SHGs to MNCs and national technology providers. With minimal registration hurdles and digital access, GeM democratizes access to the government procurement market.

Milestones at Year Eight: Scale and Impact

As of 2025, GeM’s expansion has been exponential:

1. Widening Base

• Over 1.64 lakh buyers (Government entities)
• 4.2 lakh+ sellers and service providers
• 10 lakh+ MSEs, 1.3 lakh artisans, 1.84 lakh women entrepreneurs, and 31,000 startups on board

2. Strategic Transactions

• ₹5,000 crore for Akash Missile System components
• ₹5,085 crore in vaccine procurement
• Complex services like drone-as-a-service, wet leasing of chartered flights, and GIS-based insurance schemes

3. Nationwide Adoption

• Implemented across all 36 States and Union Territories
• Eight states (e.g., Maharashtra, Gujarat, Assam, Chhattisgarh) have made GeM mandatory
• Uttar Pradesh leads in volume and value of transactions

4. Ease of Doing Business

The platform has become a direct route for grassroots producers and service providers to access public contracts — without intermediaries.

Inclusivity at Core: Empowering the Margins

GeM stands out for inclusive procurement through special initiatives:

• SWAYATT (Startups, Women & Youth Advantage Through e-Transactions)

• Facilitates onboarding of startups, women-led enterprises, youth, and SHGs
• Encourages regional participation and boosts local economies

• Startup Runway 2.0

• Allows listing without mandatory DPIIT certification
• Curated product shelves and demo opportunities for innovation-focused startups

• Womaniya Initiative

• Dedicated space for products made by women entrepreneurs and SHGs
• Encourages gender-responsive procurement

• SARAS Collection

• Features curated handcrafted products from SHGs: textiles, décor, hygiene kits, gifts

• SC/ST Entrepreneur Focus

• Partnership with NSIC and Ministry of Social Justice to onboard marginalized entrepreneurs
• Dedicated help desks and credit linkage

Benefits Delivered: Beyond Digitization

1. Transparency & Anti-Corruption

GeM removes intermediaries, tender manipulation, and backdoor deals. Every purchase is traceable, priced, and documented.

2. Time & Cost Efficiency

Procurement cycles have shortened drastically. Competition has also driven price rationalization, resulting in major cost savings.

3. Small Business Growth

MSEs, women entrepreneurs, and tribal producers find in GeM a reliable, recurring customer — the government.

4. Data-Driven Decision Making

The dashboard allows real-time procurement tracking, enabling policy adjustments and budgetary control.

Challenges: The Platform’s Growing Pains

Despite achievements, GeM faces serious operational and structural challenges:

• Awareness and Capacity Gaps

• Many government officers and potential vendors, especially in rural India, are unaware of how to use GeM
• Lack of training and digital literacy limits onboarding

• Payment Delays

• While the portal is digital, payments are still processed by individual departments
• Manual delays in payment discourage vendors and reduce trust

• Quality Control Issues

• With thousands of vendors, product and service quality is inconsistent
• Standardization and rating mechanisms are underdeveloped

• Logistical Hurdles

• Sellers from remote areas struggle with delivery due to lack of last-mile logistics support

• Platform Stability

• The interface occasionally suffers lags, crashes, and bugs, especially during high traffic (e.g., financial year-end)

• Inconsistent Procurement Rules

• Lack of uniformity in departmental procurement norms leads to confusion and inefficiency

Recent Improvements and Roadmap Ahead

The government has undertaken key steps to overcome these bottlenecks:

• Vendor Rating & Feedback Systems: Being enhanced to improve quality assurance
• Credit Integration: Tie-ups with NBFCs and SIDBI to offer working capital loans
• Logistics Partnerships: Collaborations with India Post and private logistics firms
• Training Programs: Pan-India GeM workshops and digital literacy campaigns
• Payment Reform Proposals: Centralized processing cells being explored

The roadmap ahead includes AI integration, real-time fraud detection, and a mobile-first interface to enhance vendor usability.

Strategic Implications: Public Procurement as Policy Tool

GeM is not just an e-commerce portal. It is increasingly becoming a strategic governance instrument:

• Policy Alignment: Government procurement aligned with Make in India, Digital India, and Startup India
• Emergency Response: Enabled rapid procurement during COVID-19, including masks, ventilators, and vaccines
• Environmental Responsibility: Push for eco-labelled and energy-efficient procurement
• Sustainability Inclusion: Integration with circular economy and SDG-linked product tags

Global Comparisons: India’s Unique Model

Few countries have achieved GeM’s scale and social intent:

• Chile’s ChileCompra and South Korea’s KONEPS are often cited models — but they are largely centralized platforms with lesser small-entrepreneur outreach
• GeM blends e-procurement with affirmative action, enabling marginalized communities to access government markets

India now offers its model to other Global South economies as a blueprint for digital procurement reform.

Conclusion: A Marketplace That Moved a Nation

In just eight years, GeM has redefined how a nation of 1.4 billion conducts its most routine — yet impactful — governance function: public procurement. From empowering a weaver in Odisha to helping a startup in Bengaluru win a government contract, GeM brings together policy, technology, and equity on one platform.

Yet, for it to reach its full potential, India must continue refining its processes, expanding awareness, and prioritizing user trust. As India aims for a $5 trillion economy, GeM is not just a backend utility — it is the digital nerve center of public value creation.

Quote to End:
“A marketplace is where goods meet gold. But a good marketplace is where trust meets transformation — and GeM, at eight, stands as both.”

Target IAS-26: Daily MCQs :

📌 Prelims Practice MCQs

Topic:GeM Celebrates 8th Incorporation Day