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OEM Chinese cartridges controlling GeM portal

Department for Promotion of Industry and Internal Trade (DPIIT) and Department of Expenditure has issued directives for all government entities to give preference to Make in India goods

By Newsd
Updated on :
Printer Consumables OEMs manipulating GeM portal to extract unjustified prices

The Coronavirus pandemic situation across the globe and souring relationship with border sharing countries has given us an apt opportunity to move towards making the country self-reliant by promoting “Make in India” goods in the public procurement process and in line with the Prime Minister’s Narendra Modi’s call to make the country “Aatmanirbhar”.

Department for Promotion of Industry and Internal Trade (DPIIT) and Department of Expenditure has issued directives for all government entities to give preference to Make in India goods and services and have also restricted all Ministries/ Departments to procure goods from manufacturers whose products are manufactured in the countries which share a land border with India on the grounds of defense of India or matters directly or indirectly related to security.

No doubt it is a much-awaited and most welcomed initiative of our Prime Minister to free the economy from the clutches of countries like China who have been gradually destroying our economy like a termite for years now.

However, despite the clear guidelines of the government, the government’s own procurement platform i.e. Government-e-Marketplace (GeM) which is an ambitious initiative under the ‘Digital India’ drive is tearing it into shreds and is continuing to sell Printer Toners of Chinese origin.

It is a known fact that printer consumables such as Toners of all major brands like HP, Samsung, Canon, Lexmark, Brother, Xerox, Epson, Nine Star (Pantum), etc. are mainly manufactured in China and since these companies have large printers base in the government sector, they have been taking advantage of the special category of ‘OEM Cartridges/Consumables’ on GeM which allows only OEMs or their selected authorised dealers/resellers to sell printer consumables.

These OEMs are manipulating the GeM platform to sell their Made-in-China toners to extract unrealistic and unjustified prices from the government which is resulting in draining out of substantial foreign exchange which a great loss to the Government Exchequer and also defeats the very purpose of creating the GeM.

The alarming factor is that toners of all major OEMs are easily available at 40-50%  lower prices than the prices offered by them on GeM portal and the  GeM authorities are well aware of this fact but have not taken any step to prevent these companies either from selling Chinese products or stop/ control the exorbitant prices these companies are charging which is totally in contravention to the Govt Orders and announcement made by PM Modi.

Further, it is clear from the government directives that for any procurement less than Rs 200 Cr, only Class 1 Local supplier ( with local content of 50% or more) or Class 2 local suppliers(  with local content of 20to 50%) are eligible to bid and non-local suppliers sharing the land border are not eligible to bid.

There is no extra value addition in the toners manufactured outside the country in comparison with the toners manufactured by  Class-I & Class-II local suppliers as the toners being manufactured indigenously are at par in terms of quality and performance with the imported toners. But due to the casual approach of GeM authorities hundreds of Make in India genuine ‘Class-I and Class-II local suppliers’ are struggling to get benefits of “purchase preference” guidelines laid down by DPIIT.

With the new policy and guidelines, the exclusive category for OEMs on GeM portal has now become irrelevant and  redundant, hence it is the right time for GeM authorities to take  concrete steps to ensure that :

  • OEM Category for printer consumables is withdrawn with immediate effect as no bid is more than Rs 200 Crore. All the bids are in the range of a few lakhs to 3-4 Crores maximum.
  • Only one category of Make-in-India suppliers is created in line with the directions of the above order issued by DPIIT and Deptt of Expenditure.
  • New guidelines issued by DPIIT and Deptt of Expenditure are immediately implemented in GeM as mandatory conditions to allow only Class-I and Class-II local suppliers in the procurement process by the procuring entities less than Rs 200 Crores.

These guidelines should also be implemented in respect of all other product categories as well without any delay to prevent the draining out of the substantial foreign exchange to which is a great loss to the Government Exchequer.