GeM vs open tender under GFR 2017: thresholds, custom bids and system integration projects

What is the difference between GeM and an open tender?

GeM is a marketplace: registered sellers list products and services, and government buyers purchase from them by direct purchase, by choosing the lowest price, or by running a bid or reverse auction on the portal. An open tender is a published invitation to bid on a scope the buyer has written, open to any bidder that meets the stated criteria. GFR 2017 calls it an advertised tender enquiry.

GeM was launched in August 2016, according to a Press Information Bureau (PIB) backgrounder, and the Department of Expenditure's Manual for Procurement of Goods 2024 describes it as the National Public Procurement Portal. Open tenders are published on GeM-CPPP, which is designed, hosted and maintained by the National Informatics Centre (NIC) with the Procurement Policy Division of the Department of Expenditure. Bids are received through e-procurement portals, such as NIC's GePNIC.

The two systems are now linked. PIB reported that the integration of the Central Public Procurement Portal with GeM is complete, and Rule 159 of GFR 2017 requires central ministries, departments and their offices and bodies to publish tender enquiries, corrigenda and bid awards on GeM-CPPP. Rule 160 makes it mandatory to receive all bids through e-procurement portals.

When is GeM mandatory?

GeM is mandatory for goods and services that are available on GeM. Rule 149 of GFR 2017 says procurement of goods and services by ministries or departments will be mandatory for goods or services available on GeM, and that the procuring authorities will certify the reasonability of rates. The Manual for Procurement of Goods 2024 says the mandate covers ministries and departments, including attached and subordinate offices, central public sector enterprises (CPSEs), autonomous bodies and local bodies.

Before buying outside GeM, central government buyers are required to obtain a GeM Availability Report and Past Transaction Summary (GeMARPTS), which shows whether the item is available on GeM and what it has sold for. PIB's GeM backgrounder describes this requirement.

Rule 149 also forbids dividing a demand into small quantities to avoid L1 buying, bidding or reverse auction on GeM, or to avoid the sanction of a higher authority. GFR 2017 are rules of the Government of India. State governments and state public sector undertakings follow their own procurement rules and orders, so a bidder should check the rules that apply to the buyer concerned.

What are the current GeM purchase limits?

The limits were set by the Department of Expenditure's office memorandum No. F.1/3/2024-PPD of 10 July 2024, which amended Rule 149. They are unchanged in the Department of Expenditure's compilation of GFR 2017 updated to 31 January 2026, the latest compilation on its website as of September 2026.

The limits apply only to purchases made through GeM; purchases outside GeM follow the other GFR rules. Scientific ministries and organisations listed by the Department of Expenditure, such as the Department of Science and Technology, the Department of Atomic Energy and the Defence Research and Development Organisation, have higher limits under an office memorandum of 18 July 2024: direct purchase up to Rs 1 lakh, and L1 purchase above Rs 1 lakh up to Rs 10 lakh.

How does an open tender work outside GeM?

Outside GeM, GFR 2017 sets the method by the estimated value of the goods. After the July 2024 amendment, goods up to Rs 50,000 may be bought without quotation; a local purchase committee may buy items not on GeM above Rs 50,000 and up to Rs 5 lakh; a limited tender enquiry may be used up to Rs 50 lakh; and an advertised tender enquiry, the open tender, should be used for Rs 50 lakh and above.

Under Rule 161, an open tender should ordinarily allow at least three weeks for bids from publication, or four weeks where bids from abroad are sought. No fee should be charged for tender documents downloaded by bidders. A global tender enquiry is not invited for tenders up to Rs 200 crore, unless the competent authority approves a relaxation.

What is a custom bid on GeM?

A custom bid lets a buyer float a bid on GeM even when the product or service category it needs is not available on GeM, according to PIB's GeM backgrounder. It sits between a catalogue purchase and a full open tender: the buyer writes the requirement, but the bid runs on GeM.

Custom bids matter to integrators because an integrated scope, such as a control room or a campus network with design, installation and maintenance, is rarely a single catalogue item. GeM sets its own rules for custom bids, including minimum values and bid durations, and these change. Check GeM's current buyer guidance before relying on any figure.

How is a system integration project classified for procurement?

By its primary purpose. The Manual for Procurement of Goods 2024 divides procurement into goods, services (consultancy and non-consultancy) and works. It says the main difference between goods and works is where the output is made: goods are manufactured on the supplier's premises, apart from installation and commissioning, while works are executed on the procuring entity's premises.

Where the category is unclear, the manual says the simpler procedure should be followed: in a doubt between goods and works or services, the case should generally be processed as goods. It adds that installation, commissioning and annual maintenance of mechanical, electrical or ICT assets may be handled as procurement of goods. For composite contracts, the buyer should look at the primary intention, irrespective of relative values. If goods are primary and services or works incidental, it is a goods procurement; if the reverse, it is works or services.

The manual also says IT projects should usually be procured as consultancy services, because outcomes vary from one provider to another. It names composite IT system integration services as one such type, covering design, development, deployment and commissioning, including hardware supply, software development, bandwidth and operation and maintenance after go-live. It notes that separate but linked contracts for goods, works and services are possible, but implementation may become challenging.

What does this mean for a command centre, network or building systems project?

It means the procurement route follows the scope, so the scope should be settled first. Individual products, such as cameras or network switches, may be available as GeM catalogue items. A scope that combines design, supply from several manufacturers, installation, integration and years of operation is closer to the composite IT system integration that the Manual for Procurement of Goods 2024 describes. What bidders must prove at the first stage is covered in our guide to command centre tender pre-qualification.

The items below are worth settling, and recording, before the route is chosen.

• Whether the primary intention is goods, works or services, with the reasons on file
• A GeMARPTS report for any part bought outside GeM
• Whether the scope is one contract or separate linked contracts, and who carries the integration risk between them
• The estimated value for the whole demand, which sets the method and the approvals, without splitting it
• The preferences that apply, such as the Public Procurement Policy for Micro and Small Enterprises and the Make in India preference order
• The operation and maintenance period, what it covers, and how it is priced

How Ahuva approaches public-sector contracting

Ahuva was empanelled with BSNL, KELTRON and RailTel as an authorised business partner in 2025, and in the same year committed exclusively to public infrastructure. KELTRON is its contracting route into Project Sarthi for the Greater Visakhapatnam Municipal Corporation, which covers adaptive traffic control, violation enforcement and an integrated command and control centre, and is in delivery.