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‘Make in India’ and e-Procurement

Government of India has launched the initiative ‘Make in India’ to facilitate investment and build manufacturing infrastructure in India. The various sectors being targeted are – automobiles, automobile components, aviation, biotechnology, chemicals, construction, defence manufacturing, electrical machinery, electronic systems, food processing, IT, leather, media and entertainment, mining, oil & gas, pharmaceuticals, ports, railways, renewable energy, roads & highways, space, textile and garments, thermal power, tourism & hospitality and wellness.

Government of India has come out with a very clear agenda – it wants the companies across the globe to come here and manufacture in India. These are very interesting times, for companies operating globally to come here and make in India. Though there are many reasons to invest in various industry sectors mentioned above, however, each sector has its own statistics, growth drivers, FDI policy, sector policy, and financial support extent by government and investment opportunity.

Consider automobile sector for instance, India is supposed to be the fourth biggest auto market in the world. Global car manufacturers are queuing up to launch vehicles here in India.  This industry alone accounts for around 7% of India’s GDP! And, that’s not all that is to it. Passenger vehicles segment is slated to grow at over 15% CAGR between 2013-20. In such a growing setup, companies need a purchase mechanism that is quick, smart, efficient and effective. Since India has infrastructural issues, which are oblivious to none, it is imperative that procurement system is streamlined, automated & transparent and offers better competition and pricing amongst Indian vendors. E-Procurement not only helps in automating the entire manual process of purchase but it also significantly reduces the turn around time through online negotiations.

Even sectors such as construction can benefit from e-Procurement and especially from e-Auctions. Industry such as food processing has been working out ways to innovate and break the cartel in food packaging and transport through order allotment via Reverse e-Auctions. IT and BPO industry has started using e-Procurement for facility management and maintenance services. It helps in breaking the cartel and getting a good deal. Tourism and hospitality industry is looking at e-Auctions to increase the occupancy rates of hotels through bidding and online negotiations.

Pharmaceutical sector, which depends heavily on movement of drugs under a controlled environment, has started looking at e-Procurement and reverse e-Auctions to get better pricing for transportation and reduce the time wasted in offline tender management and negotiation. You may like to see one of our interesting case studies here.

Unequivocally, ‘Make in India’ campaign is being given a major push by Government of India and in such a case, e-Procurement will help facilitate the companies to procure and build value for the entire world efficiently, from here in India.

 

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