Make in India: Challenges & Prospects

‘Country of Origin’ on GeM Portal

Note4Students

From UPSC perspective, the following things are important :

Prelims level : GeM

Mains level : India-China trade deficit

The government has made it mandatory for sellers on the Government e-Marketplace (GeM) portal to clarify the country of origin of their goods when registering new products.

Practice question for mains:

Q. India’s quest for self-reliance is still a distant dream. Critically comment in light of the popular sentiment against the Chinese imports in India.

What is Government e-Marketplace?

  • The GeM is a one-stop National Public Procurement Portal to facilitate online procurement of common use Goods & Services required by various Government Departments / Organizations / PSUs.
  • It was launched in 2016 to bring transparency and efficiency in the government buying process.
  • GEM aims to enhance transparency, efficiency and speed in public procurement.
  • It is a completely paperless, cashless and system driven e-marketplace that enables procurement of common use goods and services with minimal human interface.
  • It provides the tools of e-bidding, reverses e-auction and demand aggregation to facilitate the government users to achieve the best value for their money.
  • The purchases through GeM by Government users have been authorized and made mandatory by the Ministry of Finance by adding a new Rule No. 149 in the General Financial Rules, 2017.
  • It has been developed by Directorate General of Supplies and Disposals (Ministry of Commerce and Industry) with technical support of National e-governance Division (MEITy).

What is the new move?

  • Sellers on the GeM portal will now have to disclose the origins of their products.
  • The portal also has a ‘Make in India’ filter, and government offices will be able to ascertain which products have a higher content of indigenously produced raw materials.

Why need ‘Country of Origin’ tag?

  • The tag would help bidders choose products that meet the ‘minimum 50 per cent local content’.
  • This is the new procurement norm amended by the government earlier this month categorise suppliers based on the level of local content in their goods.
  • The GeM portal now allows buyers to reserve a bid for Class I local suppliers, or suppliers of those goods with more than 50 per cent local content.
  • For bids below Rs 200 crore, only Class I and Class II (those with more than 20 per cent local content) are eligible.

Why is all of this happening?

  • The decision comes in the backdrop of the government’s push for self-sufficiency which intends to promote self-reliance by boosting the use of locally produced goods.
  • At $ 70.32 billion in 2018-19 and $ 62.38 billion between April 2019 and February 2020, China accounts for the highest proportion of goods imported into India (around 14 per cent in 2019-2020 so far).
  • It also follows the deadly clashes between Indian and Chinese troops in Galwan Valley which have prompted several government departments to launch an offensive against imports from China.

How will ordinary consumers in India be impacted?

  • The announcement may over time filter out imported goods from use in government offices and facilities.
  • This might provide an opportunity to Indian manufacturers across industries to push their products in government facilities.
  • A more direct impact may be seen if the proposal to mandate the country of origin for products on private platforms is implemented.
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