Government E-Marketplace (GeM), the ‘sarkari’ online procurement platform, was launched on the 9th of August 2016 by the Commerce and Industry Ministry. Currently, the GeM aims at digitising the procurement of goods and services by various government bodies, public sector undertaking, and other autonomous bodies.
Recently, the Commerce Ministry Cabinet has proposed to extend the marketplace for business-to-consumer (B2C) businesses also. If the plan goes well, the consumers and non-government businesses will be able to buy products listed on GeM, similar to that of the private online marketplaces such as Flipkart and Amazon.
The roadmap to such transition will be done in three phases. The first phase would allow private companies/contractors working on government projects to buy products from GeM rather than the government buying products and transferring it to them.
The second phase would allow the purchase of products by private companies for their personal use. For example, any private company planning to set up a new office will be able to buy furniture and electrical appliances from the GeM.
Also Read: Impact of FinTech Companies in Tier II and Tier III Cities of India
Final and the third phase will open the GeM portal for the individual buyers. Any individual will be able to buy laptops, refrigerators, washing machines and many other products for his personal use, once the third phase will be launched.
This approach of the GeM to open the portal for consumers and private players will definitely help the domestic market in India and will be a tough fight for the foreign players.
Till date, more than 1 million products are listed on the portal for around 37,933 buyer organisations. With the roadmap to launch the marketplace in three phases, the government is all set to conquer the e-commerce market and compete for the deep discounting model prevailing there.
The government is also planning to introduce an e-commerce policy, which will set a maximum limit on the discount that can be offered on a product. Keeping this planning in mind, the FDI in e-commerce guidelines which have forbidden online marketplace from holding more than 25% share in an online seller.
Once the e-marketplace is open for consumers in India, e-commerce players such as Flipkart and Amazon will have to compete with the government promoted marketplace. This competition would bring down the prices of the products and eliminate fraudulent pricing from the e-commerce industry.
I am an aspiring Chartered Accountant. I spend most of my free time dredging through the various Indian finance subreddits. I am a semi-professional bowler with a high strike rate every time there is a new tax reform!
