Government e-Marketplace Records Transaction Decline in FY26
State-run public procurement platform Government e-Marketplace (GeM) experienced a notable decrease in its transaction volume during the financial year 2026. Officials confirmed on Monday that the platform saw a 7.4% decline in transactions, with the gross merchandise value (GMV) settling at Rs 5 lakh crore. This figure marks a drop from the previous financial year's GMV of Rs 5.4 lakh crore, highlighting a shift in procurement patterns across government departments.
Coal Ministry's Reduced Procurement Drives the Downturn
GeM CEO Mihir Kumar provided insights into the factors behind this decline, pointing to a significant reduction in procurement by the coal ministry. "Last year, the ministry of coal contributed close to 39% of the total GMV. This year, it has come down to about 20%," Kumar explained. He attributed this sharp fall primarily to unique procurement related to mine development and operations services, which saw substantially lower activity in FY26 compared to the previous period.
Despite this downturn, the coal ministry retained its position as the top procurement ministry on the GeM platform. The reduction in its share, however, had a pronounced impact on the overall transaction metrics, underscoring the ministry's influential role in the platform's economic performance.
Analysis of GeM's Performance and Future Outlook
The decline in GMV raises questions about the fluctuating dynamics of government procurement through digital channels. While GeM continues to serve as a critical tool for streamlining public purchases, the variability in contributions from key ministries like coal suggests that external factors, such as project cycles and operational needs, can significantly influence transaction volumes.
Officials emphasized that despite the drop, GeM remains a pivotal platform for enhancing transparency and efficiency in government spending. The focus now shifts to understanding how other ministries might adjust their procurement strategies and whether initiatives to diversify procurement sources could stabilize future GMV figures.
This development highlights the importance of monitoring sector-specific trends within public procurement, as shifts in major contributors like the coal ministry can have ripple effects on overall platform performance. Stakeholders will be watching closely to see how GeM adapts to these changes in the coming financial years.
