The Punjab State Grains Procurement Corporation (Pungrain), a subsidiary of the state’s food and civil supplies department, has asked godown owners, who previously leased their facilities for storing foodgrains under the Private Entrepreneurs Godown (PEG) scheme, to rework their financial terms.
However, godown owners said the deal will not conclude because Pungrain capped the offered rates way back in 2012. As a result, the owners have already requested the corporation to vacate the godowns.
Pungrain has sent a communication to PEG godown owners, asking them to attend a financial negotiation on October 21 regarding the rehiring of their godowns. The state corporation is rehiring a total capacity of 35 lakh tonnes, for which tenders were initially invited in April. These godowns were originally hired back in 2012.
“We are not hopeful of any positive result because Pungrain has fixed a ceiling on the rates offered back in 2012,” said Dapinder Singh Brar, head of the PEG Owners Association.
The godowns were initially hired at a monthly rent of ₹3.75 to ₹4.25 per quintal. Later, in 2023, these state-wide facilities were leased for a three-year term that has now concluded. Offering the same rent 14 years later is completely unjustified, Brar said.
A senior official in the food and civil supplies department said the issue is being handled carefully to satisfy PEG owners while ensuring no storage space is lost.
The PEG association has sent a communication to the managing director of Pungrain, stating that their grain storage agreement expired in April following delays in the tender process. While renewal tenders were invited that same month, godown owners claim the process has stalled due to the department’s “red-tapism”.
As an interim arrangement, the godowns continued to be used on an actual utilisation basis for six months. However, this period expired in September and the godown owners have not agreed in principle to any previous or further extensions on this basis. They have asked Pungrain to vacate the godowns.
The state’s entire warehouse capacity of 180 lakh tonnes is currently full. The government godowns are already storing 155 lakh tonnes of rice accumulated over the past three seasons. An additional 10 lakh tonnes of paddy from the last season are still waiting to be milled, which is expected to add another 6 lakh tonnes of rice to the existing stockpile.
Godowns currently hold 116 lakh tonnes of wheat, while Punjab is holding at least 275 lakh tonnes of foodgrains. A severe space shortage has forced agencies to use rice mills and mandi yards for storage. Although the Centre has set a target to procure 180 lakh tonnes of paddy during the current kharif harvest, there is simply no space available to store the grain.
Pungrain has already lost 10 lakh tonnes of foodgrain storage space to the Centre’s Food Corporation of India (FCI) because the state government has failed to give the godown owners an increase in the storage charges.
“We are also willing to shift to the FCI as they offer a higher rent price of ₹7.40 per quintal per month, which also include preservation charges,” said Brar, adding that even if the additional responsibility of preservation is entrusted on them by the FCI, they were willing to take the offer.
Gurpreet Singh Nibber is an Assistant Editor with the Punjab bureau. He covers politics, agriculture, power sector, environment, Sikh religious affairs and the Punjabi diaspora. His work in agriculture sector has been recoganised by Indian Council of Agricultural Research (ICAR), New Delhi with an award of excellence. He possesses a strong understanding of politics, people and cultural ethos of the land, and believes in fact based ethical journalism. In his career spanning over two decades he continues to write path breaking people centric, investigative and policy driven stories with an indelible impact.Read More