scorecardresearch

Govt gets 38 bids to set up wheat silos

Hubs have a dedicated railway siding and container depot facility, while the transportation from spoke to hub is undertaken through road, and from hub to hub via rail.

Govt gets 38 bids to set up wheat silos
The FCI had floated a tender in April for the construction of 14 locations under the DBFOT mode, with combined capacity of 1 mt.

The food ministry on Tuesday said it has received 38 technical bids for setting up of state-of-the-art wheat silos under the private public partnership (PPP) model across 14 locations in Uttar Pradesh, Bihar, Rajasthan, Punjab, Maharashtra and Madhya Pradesh.

This is part of a broader Rs 9,200-crore project to build wheat silos with 11 million tonne (mt) of capacity during the next four-five years under the PPP mode. These silos will be spread over 249 locations across 12 states, under a new ‘hub and spoke’ mode. These silos will be used for storing wheat for the Food Corporation of India (FCI).

Also read: Geo-political tensions are delaying a new global tax regime that may affect where MNCs are taxed

According to a food ministry statement, 15 parties have shown their interest and submitted their bids, and technical evaluation is expected to be completed in 3-4 weeks.

Hubs have a dedicated railway siding and container depot facility, while the transportation from spoke to hub is undertaken through road, and from hub to hub via rail.

The silos are being built under the design, build, fund, own and transfer (DBFOT) mode where the land is owned by the FCI and via the design, build, fund, own and operate (DBFOO) model where land belongs to private entities.

The FCI had floated a tender in April for the construction of 14 locations under the DBFOT mode, with combined capacity of 1 mt. In the second phase, a tender for construction of 66 silos with 2.47-mt capacity was floated under DBFOO in June.

The FCI will use the silos for storage of wheat through a lease of 30 years with private entities. Fixed storage charges to be paid by the FCI to private entities, based on a per-tonne, per-year basis, are the bidding parameters. This fixed charge escalates by 70% of the wholesale price index and 30% of the consumer price index.

Silos are declared as sub-mandi yards, which bring ease of procurement for farmers and lead to reduction in logistics costs.

Also read: Food ministry calls meet on Aug 30 to fix rice purchase target

As part of a pilot initiative, two rice silos with a combined storage capacity of 25,000 tonne are currently being built at Buxar and Kaimur in Bihar by private entities for the FCI.

Food ministry officials say that if food grains are stored in silos and transported in bulk, losses due to theft, pilferage and transportation would be negligible compared to the food grains stored in warehouses.

The FCI stores around 50-60 mt of rice and wheat at any given point of time. Silos ensure better preservation of food grains and enhance shelf life.

Get live Share Market updates and latest India News and business news on Financial Express. Download Financial Express App for latest business news.