Govt to GeM sellers: Declare local content share in products or lose out on business, participation in bids

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Updated: June 17, 2021 8:20 PM

Technology for MSMEs: GeM is working with the Indian Software Product Industry Round Table (iSPIRT) for a new loan app GeM SAHAY to allow sellers apply for a loan at the point of acceptance of an order.

GeMEven for made-in-India products, the government said buyers can identify products with higher local content to make buying decision accordingly.

Technology for MSMEs: Nearly a year after the Commerce Ministry said it enabled a provision for sellers on Government eMarketplace (GeM) to indicate the percentage of local content in products, the government has now warned of business losses for those who don’t declare the same while uploading their product and creating catalogue on GeM. “Sellers who do not declare local content percentage while uploading product and creating catalogue on GeM will lose out on business and will not be able to participate in bids in which buyer has chosen to procure only MII compliant products,” the ministry said.

Even for made-in-India products, the government said buyers can identify products with higher local content to make buying decision accordingly. Also, buyers have been provided with a filter in the marketplace to identify and select products from amongst Make in India (MII) complaint sellers and products only.

“It is a gimmick as some companies are taking advantage by showing Make in India certificate in comparison to those enterprises which have MSME certificate and hence are original manufacturers. Through MII compliance, other enterprises are being benefitted. Nobody checks how much local content they have in their products if they have MII certificate. They are given a 25 per cent price preference while MSMEs are offered only 20 per cent. If you are an MSME, you cannot have an MII certificate,” Janak Bhatia, Managing Director, Janak Positioning & Surveying Systems – manufacturer and distributor of survey instruments told Financial Express Online. Bhatia is also the Uttar Pradesh state President for Laghu Udyog Bharati.

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The government also announced that a loan app called GeM SAHAY is being rolled out for GeM sellers. The sellers would be able to apply for a loan at the point of acceptance of an order once the app is launched and would help in catering to the working capital needs of sellers. “GeM is collaborating with the Indian Software Product Industry Round Table (iSPIRT) for the implementation of the GeM- SAHAY project, which has been tailored to meet the specific needs of MSMEs on the GeM platform,” the ministry added. It said that loan disbursement will be instantaneous through the app instead of the conventional in-principle approval of a loan that may very often not culminate in an actual disbursal. The loans would be facilitated through public sector banks, private banks, and NBFCs.

GeM has over 6,90,000 MSE sellers contributing more than 56 per cent of the total order value on GeM, Commerce Secretary Anup Wadhawan told reporters on Wednesday. The number of MSEs registered on the GeM platform had jumped over 62 per cent since FY20. Since its inception in August 2017, GeM has facilitated 67.27 lakh orders worth 111,113 crores from 18.85 lakh sellers for 52,275 government buyers. Moreover, 6,95,432 MSEs have fulfilled 56.13 percent of the total order value on GeM.

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