GeM and Indian Railways integration to generate Rs 500 bn opportunity for MSMEs

According to Piyush Goyal, after the integration of Government e-Marketplace (GeM) portal with Railways, there will be Rs 500 billion worth of annual procurement from MSMEs.
GeM and Indian Railways integration to generate Rs 500 bn opportunity for MSMEs
New Delhi

The central government’s MSME-dominated public procurement portal Government eMarketplace (GeM), is currently underway integrating all procurement made by Indian Railways onto its platform. This, according to Piyush Goyal, Commerce and Industry Minister, GOI, may see around Rs 500 billion of annual procurement done online. He also informed that the pilot bidding by Railways’ buyers through GeM is likely to begin by August end and the integration will lead to a lot of savings for the public exchequer and also result in big-ticket procurements by the Petroleum and Steel sectors.

The MSME-dominated Government e-Marketplace (GeM) portal currently has approximately 19 lakh sellers, among which close to 7 lakhs are micro and small sellers with a 56.12 per cent share in order value, as on June 1, 2021.

Sanjiv Layek, Executive Secretary, World Association for Small and Medium Enterprises (WASME) said that, selling to Railways is bound to benefit MSMEs not just in supplying various train manufacturing equipment but also to its PSUs, etc. H added that, with its integration into GeM, Railways will also save significantly and the number of MSMEs serving Railways offline will also be getting onboard the GeM portal post integration and the number of GeM sellers will be increased.

Goyal had said at the National Public Procurement Conclave by GeM and CII in August last year that, Indian Railways currently spend around Rs 700 billion annually on procurement of over 98 per cent of goods for its operations, or its public sector units or production units. Moving this to GeM will help Railways save at least 10-15 per cent which could be almost Rs 100 billion. 

The GeM marketplace has grown 5x so far in seller count from 3.76 lakh sellers listed as of May 2020. GeM was launched by the Modi government on August 9, 2016, to boost efficiency and transparency in the public procurement process and for small businesses to leverage digital selling of goods and services.

Source: Financial Express

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