Punjab may invoke ESMA for smooth procurement

Saturday, 31/03/2018

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TRANSPORTERS USED TO CHARGING ‘EXCESSIVE RATES’ BOYCOTT FOODGRAINS TRANSPORTATION TENDERS IN MANY DISTRICTS AFTER THE GOVT PUT A PRICE CAP.

CHANDIGARH: The Punjab government is contemplating to invoke the Essential Services Maintenance Act (ESMA) against transporters to ensure smooth procurement of food in the state.

The move to enforce the provisions of ESMA was considered at a meeting held on Friday under the chairmanship of the chief secretary to review the difficult situation created by the boycott of the tendering process by transporters in most districts, said an official privy to the development. The Act will empower the authorities to proceed against any transporter or contractor refusing to provide wheat transportation from grain markets.

Of the 395 clusters, tenders for transportation of foodgrains in 2018-19 have been finalised for only 100 so far even as the wheat procurement is scheduled to commence on April 1. In Jalandhar, Barnala, Sangrur, Ferozepur and Patiala districts, no tenders were received from truck operators who stayed away due to the rate cap imposed by the state government in its foodgrains transportation policy for 2018-19. The authorities have opted for fresh tenders, which will be opened in first three working days of next week.

“If the situation persists, the government will clampdown hard but not allow fleecing to continue,” said the official.

Six government procurement agencies, including the Food Corporation of India (FCI), have a wheat procurement target of 130 lakh metric tonnes this time. Transporters, mainly truckers, are used to carry wheat from mandis to storage depots. The nub of the problem is the “excessively high rates”, dubbed as “fleecing” in official circles, which transporters have been charging for carrying foodgrains for the past 8-10 years.

The FCI reimburses the government at a fixed schedule of rates (SOR) – about ₹35 per tonne for this Rabi season. It does allow a premium, but there has been a huge disparity in rates charged by truck operators, primarily unions, across districts for the same distance despite hardly any difference in their operating costs. These rates varied from cluster to cluster.

In Amritsar, the lowest rate over and above SOR was 43% quoted by a contractor last year whereas a truck union bid 187% in the same district. In Barnala, the bids ranged from 283% and 341% over and above SOR, according to official figures. There was a massive variation in rates in Fatehgarh Sahib. Officials blame cartelisation for the discrepancy.

The food and civil supplies department has decided to cap the premium at 120% over and above SOR this time. While the FCI paid the state about ₹350 crore for transportation last year, the fund-starved government had to bear the loss of about ₹175 crore on account of “overcharging” by transport operators.