By shifting all government' procurement to its own online marketplace GeM, India is expected to have the potential to save nearly $10 billion.
India has saved $1 billion so far after shifting part of its $400 billion public procurement to Government e-Marketplace (GeM), the Centre's online marketplace.
"Every penny saved is a penny added to the topline. It's an addition to the government's kitty," Talleen Kumar, GeM's chief executive officer, told Bloomberg.
"If GeM is able to bring about savings in procurement, that money can be utilised by the government for other important purposes and priorities," Kumar added.
Moneycontrol could not independently verify the story.
GeM, which helps ministries and state companies connect with sellers, was launched in August 2016.
The savings from the GeM portal come at a time when the government is trying to keep a check on fiscal deficit.
According to Kumar, only around $3.5 billion of the annual procurement is currently conducted through the GeM portal, and this figure could reach $100 billion in three to five years.
The move from the legacy procurement system could generate annual savings of $10 billion, Kumar told Bloomberg.In June 2020, the Centre made it mandatory for sellers to specify "Country of Origin" for products offered on the online marketplace.
In a written reply to a question in the Rajya Sabha, Union Minister Piyush Goyal said 50,346 contracts were awarded between June 4, 2020, and September 15 to various sellers for the products that complied with the new guideline.