FY20 official procurement through national portal may touch Rs 50,000 crore

NEW DELHI: Led by higher purchases of goods and services by public sector units through the Government e-Marketplace (GeM), the government expects total official procurement to jump to Rs 50,000 crore this financial year from Rs 17,325 crore in FY19.

Among states, Uttar Pradesh, Madhya Pradesh and Maharashtra are the biggest users of GeM, which is India’s national public procurement portal for completely online purchase of goods and services by government organisations.

"PSUs are coming on GeM for big ticket items. We expect the total procurement this financial year at Rs 50,000 crore," said an official in the know of the development, adding that the government had directed all such units in November last year to procure all their official supplies from the portal.


GeM has made over 8.8 lakh products available on its platform through a network of over 2 lakh sellers and service providers. These products and services are being bought by over 34,000 government organisations (Central, State Governments and PSUs) registered on the platform.

“Government wants to move away from capex to opex model of hiring rather than buying. We feel transactions worth Rs 5-6 lakh crore can come to GeM in 5-6 years,” the official added.

As per the official, the rejection rate of vendors on the platform is less than 1%.

The commerce and industry ministry launched the GeM on August 9, 2016 in place of Directorate General of Supplies and Disposal (DGS&D) with the objective of creating an open and transparent procurement platform for government departments, ministries and agencies.

"MoUs have been signed with 12 banks for payment integration to facilitate a cashless and paperless payment system on the platform," the ministry said in a statement on Monday.

Procurement by the central and state governments put together is estimated at Rs 5-7 lakh crore each year.