After getting a nod from the finance ministry for viability gap funding (VGF), the Food Corporation of India (FCI) is set to call bids from the 21 shortlisted private players for creating three state-of-the-art food grain storage facilities — silos with a combined capacity of 1 lakh tonne.
Sources told FE shortlisted private players such as Adani Agri Logistics, LT Overseas and OM Metals would be soon asked to submit proposal for creating three silos at Whitefield Bangalore (25,000 tonne), Katihar, Bihar (50,000 tonne) and Kotkapura, Punjab (25,000 tonne). The construction of silos is expected to be completed during next one year, a senior official said. Meanwhile, the food ministry has forwarded the proposal to create silos of 25,000-tonne capacity each at Changsari (Assam), Sahnewal (Punjab) and Narela (Delhi) to finance ministry for the VGF nod.
The cost of creating a 50,000-tonne capacity silos estimated at R40 crore. Under the plan, FCI would provide guarantee of rentals for 30 years for silo operation for the private sector to recover capital investment and maintenance charges. Besides, there is a provision for 20% VGF from the government as per infrastructure projects norms.
All the silos will be have the facility of ‘railway siding’ for easier transportation of grain. Under the design-build-finance-operate-transfer (DBFOT) norms, private developer is responsible for development of the project while FCI and the state government will provide land for building the silos. “Silos take much lesser area than the conventional storage facilities,” the official said, adding that benefits expected from the creation of silos through private sector participation include timely delivery, optimum capital cost and efficient operations of project with minimal risk and involvement of implementing agency. Earlier this year FCI had conducted feasibility studies for creation of silos across 11 locations — Changsari (Assam), Pune (Maharashtra), Whitefield and Bellary (Karnataka), Narela (Delhi), Kila Raipur, Kotkapura, Sahnewal and Patiala (Punjab), and Buxar and Katihar (Bihar). Of these, eight were shortlisted for final bidding while two sites — Kila Raipur (Punjab) and Pune (Maharashtra) — were given to state government agencies.
The high-level committee chaired by former food minister Shanta Kumar earlier this year had recommended that FCI should outsource its stocking operations to various agencies such as Central Warehousing Corporation, state warehousing corporations and private companies under the Private Entrepreneur Guarantee Scheme. State governments were also urged to build silos with help from private firms. The committee report had noted that the creation of silos should be done on a competitive-bidding basis, inviting various stakeholders and creating competition to bring down costs of storage.
In 2008, the FCI had entered into a build-own-operate (BOO) agreement for 20 years with AAL, for setting up two silos with a capacity of more than 5,00,000 tonne each at Moga (Punjab) and Kaithal (Haryana).Besides, five field silos with 25,000-tonne capacity each were also built by the firm at Chennai, Coimbatore, Bangalore, Navi Mumbai and Bandel (Hooghly).