The Indian government is gearing up to leverage its Government e-Marketplace (GeM) platform to facilitate global tenders, a move significantly influenced by the recently finalized Free Trade Agreement (FTA) with the United Kingdom. This initiative aims to broaden the participation of foreign suppliers in government procurement processes, aligning with commitments made under the FTA and unlocking new opportunities for both Indian and UK businesses.

The GeM, a public procurement portal, is planning to introduce global tendering functionalities within the next month or so, marking a significant shift in India's procurement landscape. This feature will enable overseas firms to directly participate in government tenders, streamlining the process for British companies and others to engage with the Indian public sector.

Under the India-UK FTA, New Delhi has committed to allowing British firms to participate in government procurements. The integration of global tendering capabilities into the GeM portal is designed to ease the participation of British firms in Indian government procurement, offering them access to a substantial market. The FTA grants UK businesses access to India's public procurement market, which includes goods, services, and construction, presenting approximately 40,000 tenders annually, valued at around £38 billion (approximately Rs 4.3 lakh crore).

Currently, foreign suppliers face restrictions in participating in government contracts below Rs 200 crore. However, for contracts exceeding this value, foreign participation is permitted. The FTA further refines this landscape, with UK firms now eligible to bid for Indian tenders and those incorporating a minimum of 20% UK content being recognized as 'Class 2 Local Suppliers' under India's "Make in India" policy.

This development is expected to intensify competition for Indian suppliers, potentially without reciprocal access to the UK market. The government anticipates that by opening up the GeM platform to global participants, it can enhance efficiency, transparency, and competitiveness in public procurement.

Mihir Kumar, CEO of GeM, emphasized that the global tender feature was in development and would have been launched regardless of the UK FTA. Kumar highlighted that in the last 8 years, GeM has become a transformative force in public procurement, achieving unprecedented growth in both volume and value. The platform boasts over 1.64 lakh primary buyers and 4.2 lakh active sellers, offering more than 10,000 product categories and over 330 services.

The GeM platform has already made substantial strides in streamlining public procurement in India. In the financial year ending March 2025, government procurement through the GeM portal reached Rs 5.43 lakh crore. Projections for the current financial year estimate this figure to rise to Rs 7 lakh crore. Since its inception in 2016, the GeM portal has facilitated over 2.8 crore orders, totaling Rs 13.4 lakh crore by the end of March 2025.

In addition to global tendering, GeM is also set to introduce rate contract functionalities, which will allow for the procurement of goods and services at pre-negotiated prices over a specified period. This feature aims to reduce complexities and ensure price stability, benefiting both buyers and sellers.

The FTA finalized on May 6, 2025, after three years of negotiations, is poised to significantly boost bilateral trade between India and the UK. The agreement aims to reduce tariffs on 90% of traded goods, fostering stronger economic ties. The UK government projects that the FTA will increase annual bilateral trade by £25.5 billion.

Under the FTA, approximately 99% of Indian exports will enjoy zero-duty access to the UK market, enhancing their competitiveness. Simultaneously, India will reduce import duties on 90% of tariff lines, with 85% becoming completely tariff-free over the next ten years. This move is expected to offer substantial savings for Indian consumers and businesses.

CareEdge, a credit rating and research agency, forecasts that the FTA will spur annual bilateral trade growth of around 15% until 2030. Sectors such as textiles, marine products, leather, gems and jewellery, and engineering goods are expected to benefit significantly from improved market access and reduced trade barriers.

However, some concerns remain. Experts have pointed out that the UK's Carbon Border Adjustment Mechanism (CBAM), set to launch in 2027, could pose challenges for Indian exports. Additionally, the slow progress of the Bilateral Investment Treaty (BIT) between the two countries raises concerns regarding dispute resolution and investment protection.

Despite these challenges, the India-UK FTA and the GeM's push for global tenders represent a significant step towards enhancing economic cooperation and streamlining public procurement processes in India. By leveraging technology and fostering greater participation from both domestic and international players, India aims to create a more efficient, transparent, and competitive marketplace for government procurement.