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PM Modi wants Amazon like online marketplace for all govt purchases

Prime Minister Narendra Modi has decided to move all government purchases, from paper clips to power plant turbines, to an Amazon-like online marketplace.
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Prime Minister Narendra Modi has decided to move all government purchases, from paper clips to power plant turbines, to an Amazon-like online marketplace.

The online marketplace could eventually be worth a fifth of the country’s $2 trillion economy. Modi government has been riding on the new online market, which has already traded Rs390 million since it began in August.

“This provides India an opportunity for transformation. The transparency and competitiveness it has brought is very encouraging and so far we’ve seen that the government’s savings are at least 10% on every transaction,” Rita Teaotia, the top bureaucrat in India’s commerce ministry told Bloomberg.

Currently, the government uses a tender system to buy everything which then restricts buyers to local suppliers and may even result in price manipulation. The new system would allow vendors across India to bid for any government purchase.

The portal is expected to support trades worth 20% of India’s GDP once all state governments, state-owned companies, utilities, defence and railways come online.

However, since only 20% Indian have access to internet, the government will inevitably face the challenge of training staff across the country to use the digital marketplace.

Departments as diverse as finance, municipal corporations, police, hospitals and post offices, some located in villages where regular power failures make internet access difficult, are expected to be involved.

The portal would be similar to Amazon and Snapdeal in look and design by allowing  users to choose from products listed alongside photos and detailed specifications. It even allows users to compare prices offered on the marketplace with those on rival websites, reported Bloomberg.

According to the report, everyone using the portal is required to register their personal mobile phone numbers and Aadhaar biometric cards. The market’s user base is expected to rise to about 200,000 buyers.

The World Bank’s 2014 Enterprise survey, had cited bureaucratic delays and corruption as among the biggest obstacles to business in India.

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