Narendra Modi: India To Move Govt. Buys Online

India’s government is gearing up to move all of the purchases the government makes online to a marketplace that, Bloomberg reported, could be worth one-fifth of its economy.

According to the Bloomberg report, Prime Minister Narendra Modi’s government, which early last month decided to replace most of India’s cash to clamp down on corruption, is placing a big emphasis on the Amazon-like marketplace, which has traded $5.7 million since launching in August.

"This provides India an opportunity for transformation,” said Rita Teaotia, the top bureaucrat in India’s commerce ministry, in the Bloomberg report. "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 percent on every transaction."

The report noted the marketplace is forecast to support trades valued at 20 percent of the GDP in India as soon as all the government agencies, state-owned companies, utilities, railways and defense agencies join the marketplace, according to Vishal Singh, additional director at the national e-governance division, in the report. There is one roadblock to the marketplace: India’s lack of internet access. Bloomberg noted that roughly 20 percent of all Indians can access the internet, which means the Indian government will have to spend time and resources training staff to use the online marketplace.

In addition to streamlining government purchases, the marketplace is expected to bring more transparency since it is designed to leave a digital trail, which is unprecedented in terms of openness, given India hasn’t been known for being that transparent, landing seventy-sixth on Transparency International’s 167-nation corruption index. Bloomberg noted the marketplace is similar to Amazon and Flipkart in terms of how it looks and is designed. Government users choose products that are listed on the website that are accompanied by photos and details on the products. Government shoppers can even compare prices.



The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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