Lok Sabha Question No. 3124 (UNSTARRED), answered on 2017-03-21
Subject: Feature of PEG Scheme
Ministry: CONSUMER AFFAIRS, FOOD AND PUBLIC DISTRIBUTION
Asked by: HEMANT TUKARAM GODSE

## GOVERNMENT OF INDIA

## MINISTRY OF CONSUMER AFFAIRS, FOOD & PUBLIC DISTRIBUTION DEPARTMENT OF FOOD AND PUBLIC DISTRIBUTION

LOK SABHA UNSTARRED QUESTION NO. 3124

TO BE ANSWERED ON 21 ST   MARCH, 2017

## FEATURE OF PEG SCHEME

## 3124.   SHRI GODSE HEMANT TUKARAM:

Will the Minister of CONSUMER AFFAIRS, FOOD AND PUBLIC DISTRIBUTION miHkksDrk ekeys] [kk| vkSj lkoZtfud forj.k ea=h be pleased to state:

- (a) the  salient  features  of  the  Private  Entrepreneurs  Guarantee  (PEG) Scheme implemented by the Government;
- (b) whether the Government has allocated adequate funds for construction of godowns under the said Scheme during each of the last three years and the current year, if so, the details thereof, State-wise;
- (c) whether the Government proposes to cover each State under the said Scheme so as to increase the capacity of godowns for storage of  food grains in the country, if so, the details thereof and by when; and
- (d) the other steps taken by Government to ensure safe storage of food grains across the country?

## A N S W E R

MINISTER OF STATE FOR  CONSUMER AFFAIRS, FOOD & PUBLIC DISTRIBUTION (SHRI C. R. CHAUDHARY)

- (a):   The Private Entrepreneurs Guarantee (PEG) scheme was introduced in the year 2008 & 2009 for construction of storage capacity in Public Private Partnership (PPP) mode.  Under this scheme, godowns are constructed by private entrepreneurs, CWC and SWCs with their own funds and land.  Food Corporation of India (FCI) gives guarantee of hiring for 10 years in case of Pvt. Investors and 9 years in case of CWC, SWCs and other State agencies. The salient features of PEG scheme are at Annexure-I.
- (b):  As already stated above, under PEG scheme, godowns are constructed by private parties, CWC, SWCs and other State agencies by arranging their own  funds  and  land.  No  funds  are  allocated  by  the  Government  for construction of godowns.

(c): All the states are already covered under this scheme, except Delhi and North Eastern States. There is no proposal to cover each State.  State-wise details  of  capacity  sanctioned  and  completed  under  PEG  Scheme  as  on 31.01.2017 is at Annexure-II.

(d):  Capacity augmentation is also being done under Plan Scheme. Govt. of India has approved augmentation of 2,92,730 MT capacity in North-Eastern States and 76,220 MT in other States during 12th  Five Year Plan (2012-17). Out of this, a capacity of 1,17,680 MT in North-East and 20,000 MT in other States has been constructed.

Moreover, FCI is modernizing its existing storage capacity by construction of steel silos on PPP mode. Government has approved action plan for construction of steel silos in the country for a capacity of 100 LMT in 3 phases as per details below:

| year    | Selection of Silo Operator   | Silo completion   |
|---------|------------------------------|-------------------|
| 2016-17 | 36.25 LMT (Phase - 1)        | 5 LMT             |
| 2017-18 | 29.00 LMT (Phase - 2)        | 15 LMT            |
| 2018-19 | 34.75 LMT (Phase - 3)        | 30 LMT            |
| 2019-20 |                              | 50 LMT            |
| Total   | 100 LMT                      | 100 LMT           |

Against the above plan, as on 28.02.2017, silo operators for 38 LMT have been selected and 4.5 LMT of silo capacity has been completed.

In addition to capacity augmentation, normal measures taken by FCI to ensure safe storage of foodgrains are at Annexure-III.

****

## ANNEXURE-I

## ANNEXURE  REFERRED  TO  IN  REPLY  TO  PART  (a)  OF  UNSTARRED QUESTION NO  3124  TO BE ANSWERED ON 21 ST   MARCH, 2017 IN LOK SABHA.

The salient features of Private Entrepreneur Guarantee (PEG) Scheme are as under:-

- This scheme is implemented through private investors as well as Central Warehousing Corporation  (CWC)/  State  Warehousing  Corporations  (SWCs)/other  State  agencies  in PPP mode.
- Investment and construction is done by the PPP partner.  As return for investment FCI guarantees  hiring  of  the  godown  constructed  by  a  private  party  for  10  years.    The guarantee period for CWC/SWCs is 9 years.
- The  location  and  capacity  for  godowns  are  identified  as  per  storage  requirements  by State  Level  Committees  and  finally  approved  by  the  High  Level  Committee  (HLC) headed by Chairman & Managing Director, FCI.
- Minimum capacity for a godown is 5,000 MT in plain areas and 1,670 MT in hilly areas. Godowns of 5,000 MT and above capacity should be preferably within 8 KMs of full rake capacity railway goods shed/procuring mandi.  Godowns of 25,000 MT and above capacity  should  be  preferably  with  Railway  sidings.    All  godowns  should  be  near National/State highways.
- The godown must be constructed as per the specifications stipulated by FCI. In addition to  construction, the partner may also provide services like security and preservation if required by FCI.
- The period of construction normally allowed in one year for godowns without railway siding and two years for godowns with railway siding. Delay in construction upto one may  be  allowed  with  similar  reduction  in  the  guarantee  period  and  in  case  of  delay beyond one year the agreement may be cancelled.
- Selection  of  the  private  party  is  done  through  open  advertisement  and  two  stage tendering  process.    The  private  party  may  be  an  individual  or  partnership  firm  or  a company  or  trust,  having  ownership  of  land  in  the  location  where  godown  is  to  be constructed.
- A person holding land under Registered Lease for a minimum period of 13 years with permission to construct godown can also apply.
- A party, who does not own land, but intends to acquire the same within 120 days from the date of acceptance letter, can apply by furnishing an additional amount of Earnest Money Deposit (EMD) and a Supplementary Bank Guarantee @ Rs. 100.00 per MT.

******

ANNEXURE-II ANNEXURE  REFERRED  TO  IN  REPLY  TO  PART  (C)  OF UNSTARRED QUESTION NO 3124 TO BE ANSWERED ON 21 ST

## MARCH, 2017 IN LOK SABHA.

## STATEWISE CAPACITY COMPLETED  UNDER PEG SCHEME AS ON 31.01.2017

(Capacity in MT)

| Sl. No.          | State      | Capacity sanctioned/ allotted   | Completed capacity   |
|------------------|------------|---------------------------------|----------------------|
| Andhra Pradesh   | 112,800    | 87,800                          | 1                    |
| Bihar            | 432,000    | 213,000                         | 2                    |
| Chhattisgarh     | 542,230    | 537,230                         | 3                    |
| Gujarat          | 49,800     | 49,800                          | 4                    |
| Haryana          | 3,499,489  | 3,449,959                       | 5                    |
| Himachal Pradesh | 124,200    | 24,170                          | 6                    |
| Jammu & Kashmir  | 256,350    | 135,520                         | 7                    |
| Jharkhand        | 358,000    | 123,000                         | 8                    |
| Karnataka        | 241,440    | 241,440                         | 9                    |
| Kerala           | 5,000      | 5,000                           | 10                   |
| Madhya Pradesh   | 1,414,180  | 1,267,720                       | 11                   |
| Maharashtra      | 564,527    | 564,527                         | 12                   |
| Odisha           | 365,000    | 304,500                         | 13                   |
| Punjab           | 4,508,858  | 4,493,365                       | 14                   |
| Rajasthan        | 235,000    | 220,000                         | 15                   |
| Tamilnadu        | 255,000    | 175,000                         | 16                   |
| Telengana        | 319,000    | 269,000                         | 17                   |
| Uttar Pradesh    | 1,526,127  | 1,278,127                       | 18                   |
| Uttarakhand      | 10,000     | 0                               | 19                   |
| West Bengal      | 285,180    | 164,090                         | 20                   |
| Total            | 15,104,181 | 13,603,248                      |                      |

***

## ANNEXURE III

## ANNEXURE  REFERRED  TO  IN  REPLY  TO  PART  (d)  OF  UNSTARRED QUESTION NO  3124   TO BE ANSWERED ON 21 ST   MARCH, 2017 IN LOK SABHA.

## STEPS TAKEN BY FCI FOR SAFE STORAGE OF  FOODGRAINS

Before  the  commencement  of  Rabi  and  Kharif  Marketing  Seasons,  Ministry  of  Consumer Affairs, Food & Public Distribution, Department of Food & Public Distribution, Govt. of India issues uniform specifications for procurement of foodgrains for the Central Pool. These uniform specifications are circulated to F.C.I. and all State Govts./Agencies with instructions to ensure that foodgrains are procured strictly in accordance with the uniform specifications.

2. Foodgrains procured by F.C.I. and State Govts/Agencies are stored in covered godowns as well as in CAP (cover and plinth).
3. During storage, the following steps are taken for safe storage and preservations of foodgrains:
3. (i) All godowns are  constructed as per specifications.
4. (ii) Foodgrains are stored by adopting proper scientific code of storage practices.
5. (iii) Adequate dunnage materials such as wooden crates, bamboo mats, polythene sheets are used to check migration of moisture from the floor to the foodgrains.
6. (iv) Fumigation covers, nylon ropes, nets and insecticides for control of stored grain insect pests are  provided in all the godowns.
7. (v) Prophylactic  (spraying  of  insecticides)  and  curative  treatments  (fumigation)  are  carried  out regularly and timely in godowns for the control of stored grain insect pests.
8. (vi) Effective rat control measures, both in covered godowns as well as in CAP storage are used.
9. (vii) Foodgrains in 'Cover and Plinth' (CAP) storage are stored on elevated plinths and wooden crates are used as dunnage material. Stacks are  properly covered with specifically fabricated low-density black polythene water -proof covers and tied with nylon ropes/nets.
10. (viii) Regular periodic inspections of the stocks/godowns are  undertaken by qualified and trained staff and all senior officers.The health of the foodgrains is monitored at regular intervals by a system of checks and super checks at different levels. Following Checks and Super checks are conducted in the godowns by FCI to ensure proper preservation of foodgrains in the storage.
- a) Fortnightly inspection of stocks on 100% basis by Technical Assistant.
- b) Monthly inspection by Manager(QC)
- c) Quaterly inspection by AGM(QC)
- d) Super Checks by Regional, Zonal and FCI Hqrs Squads.
15. (ix) The principle of 'First in First Out' (FIFO) is followed to the extent possible so as to avoid longer storage of foodgrains in godowns.
16. (x) Only covered rail wagons are  used for movement of foodgrains so as to avoid damage during transit.
17. (xi) Damage  Monitoring  Cells  have  been  set  up  at  District,  Regional  and  Zonal  levels  to regularly monitor quality of stocks and reduce damages.