Introduction
The government marketplace is an innovative platform at the forefront of India's digital public procurement and is utilizing new generative artificial intelligence technologies, automated systems, and many different types of inclusive growth strategies to transform government tendering. In the past two years, the government marketplace has aggressively expanded its commitment to providing technological transparency and has made significant progress toward building its seller, service provider, and technology capabilities on its digital platform.
GeM’s Growth, Reach and Commitment to Inclusion
GeM recently completed eight years of operation, reporting a network of 1.64 lakh primary buyers and 4.2 lakh active sellers, supporting over 10,000 product categories and 330+ services.
As part of its inclusive expansion, the platform has onboarded over 10 lakh micro and small enterprises (MSEs), 1.3 lakh artisans and weavers, 1.84 lakh women entrepreneurs, and over 31,000 startups.
According to recent reports, the platform’s Gross Merchandise Value (GMV) continues to grow rapidly, reinforcing GeM’s position as India’s flagship public-procurement portal.
AI & Innovation: Launch of GeMAI and Technology Tools
A major development this year is the launch of GeMAI, India’s first generative-AI powered chatbot for public procurement, introduced on GeM’s 8th Incorporation Day:
“GeM celebrated its 8th Incorporation Day by spotlighting its transformative journey in digital governance. GeM launched GeMAI, India’s first generative AI-powered chatbot in the public sector, capable of voice and text interaction in 10 Indian languages.”
The rollout is a demonstration of the GeM’s support for "Innovation for Inclusion," allowing the micro and small enterprises (MSEs), startups, Artisan’s, Women-run Businesses and more to successfully navigate the GeM portal.
The GeM portal features advanced analytics, newly reformed back-end operations and policies providing more transparency while lowering transaction or assessment fee costs to vendors. In addition, it provides a secure procurement environment.
Key Policy & Structural Reforms
GeM has rolled out reforms targeting simplification, cost reduction, and inclusivity for vendors:
The platform has slashed transaction charges: for orders between ₹5 lakh and ₹10 crore, the transaction charge is reduced (a flat 0.3 % of order value), and orders above ₹10 crore have a capped transaction fee to ensure affordability.
Vendor-assessment process rationalization: reduction of chargeable fees for manufacturers and traders, lowering caution money deposits for new sellers/tiny turnover segments, and easier onboarding for small sellers.
Nearly 97 % of transactions are now fee-free, and fee structures have been revised significantly for large orders, benefiting small suppliers and reducing barriers.
What This Means for Vendors, MSMEs & Suppliers
Lower entry barriers & cost of participation — with reduced charges, simplified assessments, and inclusive onboarding, small sellers and MSMEs can participate more confidently.
Wider access & new opportunities — with 10,000+ product categories and 330+ services, vendors across sectors (goods, services, manpower) can engage in procurement suited to their capabilities.
Tech-driven user experience — with GeMAI chatbot supporting multilingual voice/text assistance, onboarding becomes easier for vendors from tier-2/3 cities and non-English regions.
Transparent tendering ecosystem — GeM’s data-driven procurement, real-time dashboards, verification processes help ensure fairness and clarity.
Use-Case Highlights & Examples
GeM’s manpower outsourcing service has facilitated over one million resource hires in FY25 across government organisations, leveraging the portal for diverse staffing needs via service providers.
High-value strategic procurements: GeM has supported procurement in defence (equipment for missile systems), vaccine procurement, drone-as-a-service, GIS & large-scale services across states.
Challenges & What to Watch
While the transformation is significant, stakeholders should note:
Vendors must ensure they meet compliance and documentation requirements to leverage the platform fully.
With increased participation, competition in certain categories may rise and quality, timely delivery, and performance history will matter.
Smaller suppliers should stay updated on category changes and align with new product/service scopes.
Though GeMAI and tech tools simplify support, some processes still require careful registration and document clarity.
Conclusion
India's government will be taking a radical approach to the procurement process, utilizing a combination of artificial intelligence tools, a new inclusive policy approach, and a scalable e-commerce platform (GeM). To further enhance the use of AI in e-Commerce by creating generative artificial intelligence (AI) chatbots; enact per fee structural reform with larger category listings available; rapidly grow the GeM platform from small dealer/vendee-like launch size to national scale for entrepreneurs, MSMEs (micro, small and medium enterprises), start-ups and government service providers in the coming year (2025) can provide significant opportunity for suppliers/vendors across India to use the digital transformation to expand, compete and meet large-scale demand from the Government.
