Government e-marketplace service procurement touches Rs 1.82 lakh crore so far in FY24

The procurement of services through Government e-Marketplace (GeM) has jumped by as much as 176 per cent to Rs 1,82,000 crore during the current financial year as on February 22 from the corresponding of Rs 66,000 crore for 2022-23, according to data released by the Commerce Ministry on Friday.

The ministry said that the total value of procurement of services now exceeds the total value of products procurement in a Financial Year which is an important milestone that indicates the faster acceptability of services by various buyers.

“In February 2024, services procurement has been phenomenal, contributing to nearly 80 per cent of the total order value transacted on GeM. The share of procurement of services in overall procurement has exceeded the 50 per cent mark in the current financial year. Two bids placed by South Eastern Coalfield Limited, a subsidiary of COAL India Limited, worth nearly Rs 40,000 crore, have catapulted the share of service procurement in this month,” the ministry said.

Commenting on this significant achievement, PK Singh, CEO, GeM, said that the GeM has harnessed digital capabilities and has emerged as a one-stop-shop for procurement of all possible services that may be required by government buyers at various levels of administration.

He said that the expansion of the service offerings on GeM has been the brightest chapter in the platform's success story, witnessing exponential growth in a short span of time.

The expanded bouquet of services on GeM has given a tremendous boost to the GeM Gross Merchandise Value (GMV). In this year alone, nearly 457 orders, worth Rs 4,036 crore, have been placed for procuring nine types of insurance services such as Group Mediclaim Insurance Service, Asset Insurance Service, and Group Term Insurance Service. The government of Gujarat has procured Group Mediclaim Insurance Services worth Rs 2,302 crore under Pradhan Mantri Jan Arogya Yojana to extend insurance cover to nearly 62 lakh families.

Innovative and unique service offerings like Local Chemist Empanelment have resulted in an average discount of 30-32 per cent on supply of medicines through GeM's e-bidding process.

This has prompted the Central government health scheme, employees and state insurance corporations, and multiple state Health & Family Welfare Departments to actively procure these services through GeM.

The procurement of services, like hiring of consultants and PR agencies, outdoor advertisement services and exhibition/event/seminar management services, has enabled government bodies to make informed policy-making decisions and effectively disseminate information.

Services procurement on GeM has also given huge impetus to key social welfare initiatives like Jal Jeevan Mission, POSHAN 2.0 etc. To further the vision of a Swachh Bharat, GeM has created separate categories for hiring of sanitation services, including collection, disposal, and management of waste.

This service is being regularly procured by Urban Development & Housing Department, Bihar, which placed 35 orders across various urban local bodies for collection, lifting, transportation and disposal of waste.

Similar contracts have also been placed by Urban & Local bodies in various states like Jammu and Kashmir, Andaman and Nicobar Islands, Uttarakhand and Delhi.

This remarkable trend underscores the increasing recognition of services as a strategic asset and highlights the importance of robust procurement infrastructure in streamlining public procurement processes. This unprecedented growth attests GeM's scalability and adaptability and the pivotal role it plays in driving India's economic growth.

GeM was established in 2016 to provide government buyers an end-to-end digital platform to carry out public procurement of goods at cost-effective rates. In FY19-20, the platform diversified its portfolio to include services as a separate segment.