Stakeholders

Consultation

Development of Steel Silo’s on DBFOT Basis under PPP mode

Ministry of Consumer Affairs, Food &

Public Distribution

FOOD CORPORATION OF INDIA

OUTLINE

Project Proposal

Bidding Structure

Q&A / Open Forum Discussion

Proposed Projects

FCI is the nodal agency for creation of modern storage capacity through

construction of Silos for foodgrains

The FCI is envisaging, development of the Wheat Steel Silos at 93

Locations across India

Implementation mode: Design Built Finance Operate Transfer (DBFOT)

basis under PPP

FCI has appointed ‘Srei Infrastructure Finance Limited’ as

Consultant’ to assess the technical feasibility and commercial

appraisal of the sub-projects including ‘Bid Process Management’

In the PPP model FCI will provide land to the private developer on

licence to create the project facility

The private developer shall be responsible for designing, financing,

construction, operation and maintenance of the project for the

concession period and handover the project facility to the Authority after

efflux of concession period.

Backdrop …

State Proposed Silo

Locations

Andhra Pradesh

/Telangana 15

Assam 1

Bihar 8

Chhattisgarh 4

Delhi 3

Gujarat 3

Haryana 4

Karnataka 5

Kerala 8

Madhya Pradesh 2

Maharashtra 7

Odisha (Orissa) 1

Punjab 6

Rajasthan 5

Tamil Nadu 4

Uttar Pradesh 11

West Bengal 6

Project Locations

Pilot Project Locations

11 locations have already

been appraised across six

States

Assessment of 2 more

locations has commenced

Initial Assessment of 80

more location shall start

shortly

State No. of

Locations Punjab 4

Karnataka 2 Bihar 2

Maharashtra 1 Assam 1

Delhi 1

Total 11

Changsari

Kilaraipur

Kotkapura Patiala

Sahnewal

Baramati

Bellary

Whitefield

Katihar

Buxar

Narela

Silo Configurations

Two Types of Silo Proposed

Producing Area Silo Complex – being planned in wheat “Producing Area”

Receiving Area Silo Complex – planned in wheat “Consuming Area”

Producing Area

Silo

• Food grain in bulk and

bagged form by road

• Food grain in bulk form

by rail (Primary)

• Bagged dispatch by Rail

or Road & bulk dispatch

by Road/Rail

Receiving Area

Silo

• Food grain in bulk form

by rail

• Food grain in bagged

form by road (Primary)

• Bulk dispatch by Road

Receipt Dispatch

• Weigh Bridges

• Unloading Station

• Conveying System

• Receiving Silos

Grain Receiving Infrastructure

• Cleaning Station

• Online Weighing

• Conveying System

• Long Term Storage Silo

Grain Storage

• Shipping Silo for Bulk Wagon Loading

• Shipping Silo for Bulk Truck Loading

• Bagging Station

Grain Dispatch Infrastructure

Producing Area Silo Complex

Railway Siding, Truck Parking, Grain Testing Laboratory, Administrative Block,

Bag Storage, Power Infrastructure, Water Infrastructure, Drainage

Infrastructure, Fire Detection & Fighting, Gates & Boundary,

Modern Silo Complex

Site Infrastructure : Producing Area

Consuming Area Silo Complex

• In-motion Weighing

• Wagon Unloading Station

• Conveying System

• Receiving Silos

Grain Receiving Infrastructure

• Cleaning Station

• Online Weighing

• Conveying System

• Long Term Storage Silo

Grain Storage

• Shipping Silo for Bulk Truck Loading

• Bagging Station

• Weigh Bridges

Grain Dispatch Infrastructure

Railway Siding, Truck Parking, Grain Testing Laboratory, Administrative Block,

Bag Storage, Power Infrastructure, Water Infrastructure, Drainage

Infrastructure, Fire Detection & Fighting, Gates & Boundary,

Modern Silo Complex

Site Infrastructure : Consuming Area

Silo Complex: Capacity Planning

Silo Complex

Conversion of old storage

Availability of Land

Regulatory

Frame work

Railway

Siding

Feasibility

Location Analysis

Gap Analysis

Silo Complex

Capacity Planning

Bidding Framework

If land is made available by FCI, CWC, SWC,

State Government or Central Government /State

Government Agency, the VGF route may be

adopted

Niti Ayog has outlined and appended the RFQ,

RFP and Model Concession Agreement for VGF

model structure

The FCI is envisaging, Development of the

Wheat Steel Silos initially at about 11 Locations

on Pilot basis under VGF Model

VGF Model …

• FCI to provide land to Investor

• FCI to provide Statutory Clearances

• Investor to construct and operate facility

Project Development

• Timely Delivery

• Optimal Capital Cost

• Efficient operations

• Minimal Involvement of FCI

Benefits • VGF by GoI

• Fixed Storage Charges

• Variable Storage Charges

• Handling Charges

Funding and Revenue

Salient Features of DBFOT Model

Proposed Project Implementation Structure

Equity Debt

Develop and maintain the project till

the end of concession period and

collect user charges fixed by FCI

Bid Parameter: VGF/Upfront

Concession Premium

Concession rights on

land for creation of the

project facility

Food Corporation of India

Private Investor / SPV

THE PROJECT

Development of Wheat Silos at 11 Locations

Concessionaire Bank

PPP Implementation Structure

Bidding Framework

Two Stage Bid Process

Shortlisting Criteria

1. Threshold Eligibility: 200% revenue/expenditure of project cost during last 5 year

2. Net worth of previous financial year equal to 100% of project cost

Bid Parameter

Viability Gap Fund (VGF) to be quoted by the shortlisted bidder

RFQ & RFP

The Model RFQ and RFP outlined and appended by Niti Ayog to be used as base for

conducting the Bid Process after suitable customisation to suit the project requirements

Concession Agreement

Model Concession Agreement developed by Niti Ayog to be used with required

customisation

RFQ to be issued for shortlisting of eligible bidders

Short Listed Eligible Bidders to be invited to submit Price Bid through RFP stage

Concession Agreement

PARTIES TO CONCESSION AGREEMENT

Concessioning Authority: FCI/State Government Agency

Concessionaire : Special Purpose Company incorporated under Companies Act by the ‘Selected Developer’

PRECONDITIONS TO CONCESSION AGREEMENT

Formation of the SPV by the selected developer for signing of the

concession agreement

Constitutional documents and Board Resolutions of selected partner

The scope of the Project (the “Scope of the

Project”) shall mean and include, during the

Concession Period:

construction and procurement of the Storage Facility

including a Railway siding on the Site

operation and maintenance of the Storage Facility in

accordance with the provisions set forth in agreements

storage and preservation of foodgrains

performance and fulfilment of all other obligations

Transfer of the silo complex after the afflux of concession

Scope of Concessionaire

Conditions Precedents

Authority procure for the Concessionaire the ‘Right of Way’ of the Licensed Premises

procured ‘Applicable Permits’

obtain required permissions from ‘Indian Railways’ for ‘Railway Siding’

execute and procure ‘Default Escrow Agreement’

Concessionaire provide ‘Performance Security’ to the Authority

execute and procure execution of the ‘Substitution Agreement’

execute and procure execution of the ‘Escrow Agreement’

procure all ‘Applicable Permits’

execute ‘Financing Agreements’

confirm the correctness of their representations and warranties

a legal opinion from the legal counsel of the Concessionaire’

(COMPLIANCE PERIOD: 120 DAYS FOR BOTH THE PARTIES)

Penalties: 0.2% for Authority and 0.3% for Concessionaire of the Performance Security for

each day’s delay until the fulfilment of such Conditions Precedent

Payment of storage charges i.e. Fixed Charge and

Variable Charge

Fixed Charge is to be paid for the storage capacity made

available by the Concessionaire.

The Silos with Railway siding bulk handling facility Base Fixed Charges

per MT per month

Prices to be Revised annually to reflect the variation in Price Index

Variable Charge is payable for the actual quantity of food

grains stored in the facility

The MCA also provides for charges to be paid for other

services such as unloading, bagging, stacking and loading

of food grains

Storage Charges

Construction

Construction Completion within 12 months from

appointed Date

Design risk will be with ‘Concessionaire’

Liquidated damages for delay in construction

completion

Construction Performance Security

Operations and Monitoring

Mechanism

Operate, maintain and manage the Project Facility can subcontract operation and maintenance, etc.

Storage Capacity shall not be less than the ‘Normative Availability’

Liquidated damages for non-performance

Deviation from O&M standards

Downtime of Project Facility

Non compliance with Engineer instruction

Monitoring Mechanism

• Independent Expert

Grant /Premium

GRANT

• FCI to provide Grant, if quoted by preferred bidder

• Grant shall be released as per the mentioned mechanism in the

concession agreement

PREMIUM

• Applicable in case Concessionaire is not seeking Grant and instead

offers to pay Premium as per the conditions of the model concession

agreement

Snapshot of projects to be bid

SN Project Site Nature of

Site

Type of

Facility

Planned

Existing

Capacity

(MT)

Planned

Capcity

(MT)

Future

expansion

(MT)

1 Kotakapura Brown Field Producing 41699 25000 -

2 Sanewhal Brown Field Producing 89000 50000 -

3 Katihar Green Field Consuming

10800

(Separate

Facility)

50000 50000

4 Nerala Brown Field Consuming 50000 50000 50000

5 Changsari Green Field Consuming

50000

(Depot

under

const.)

50000 -

Thank You

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