Increasing food storage capacity in UP: Private companies to set up modern silos

The Yogi Adityanath government is planning to create an additional food storage capacity of up to 5 lakh metric tonnes (MT) by asking private companies to set up modern silos against an assured business guarantee.

Apart from business guarantee, the state government will also make land available on lease to the private entrepreneurs who agree to set up silos.

A policy in this regard is expected to get Cabinet’s nod after the investors’ summit.

It will be followed by invitation for bids from interested private firms.

“The government has decided to enhance our food storage capacity by additional 5 lakh MT by asking the private entrepreneurs to set up silos for which we will give certain incentives to them,” principal secretary, food and civil supply, Nivedita Shukla Verma said.

“We have adopted the central government’s private entrepreneurs guarantee scheme to augment storage capacity in the state,” she added. The UP state Warehouse Corporation, she said, had been nominated as the nodal agency for the execution of the scheme.

Under the scheme, according to sources, the government will make land available on a 30-year lease to an entrepreneur who sets up a silo at an appointed place.

The Food Corporation of India (FCI) will give such silos a guarantee for business for 10 years. The company will charge a rent to be determined by the FCI for allowing the silos to be used for storing the food grain like wheat and paddy.

The government’s move comes in view of its policy of increasing the food procurement target.

Currently, the state’s existing total storage capacity is only around 56 lakh MT against the peak demand of 70 lakh MT.

“There is a critical gap of around 15 lakh MT due to which wheat procured from farmers has to be often kept in open, which often ends up getting drenched.

The state had fixed the wheat procurement target at 80 lakh MT last year. Though the target achievement was only half-way through, the procurement was one of the highest in recent years. And this had sent the government on a hunt desperately looking for additional storage on air strip, in closed sugar mills, in flour mills, cold storages, mandi yards or any other suitable place to meet the challenge.

“The government is expected to keep the target around the same next month for the current year,” sources said.