Wheat procurement: After CM intervenes, Mandi, transport, labour contractors join registration process

After the intervention of Chief Minister Nayab Singh Saini, a standoff between mandi transport contractors (MTC), mandi labour contractors (MLC) and the government was resolved over the MTC-MLC tender policy for 2025-26 for handling and lifting wheat. The contractors opposed the policy and refused to register for handling and lifting wheat. The Food, Civil Supplies and Consumer Affairs Department has amended some of the conditions. Now, the contractors have joined the registration process for the handling and lifting of wheat, the procurement of which will start on April 1. Here is what you need to know about the MTC-MLC tender policy’s previous provisions and amendments made by the department.

Why did transport and labour contractors refuse to join the registration process for several days?

Transport and labour contractors were infuriated over the tender policy for 2025-26 and initially refused to participate in the registration process. Their hesitation was due to some changes made by the state government in the policy in February, which were opposed by the transport contractors. Despite raising concerns, the contractors found the initial amendments insufficient. When no solution emerged from officials, they approached the Chief Minister Nayab Singh Saini at his Chandigarh residence last week, demanding further modifications. The CM directed authorities to address their concerns, after which the Food, Civil Supplies and Consumer Affairs Department accepted the majority of their demands.

What are the new vehicle requirements and changes in the security deposit?

Under the policy, every contractor is required to own at least 30 per cent of the trucks required for wheat lifting in each grain market. If they fail to meet this requirement, they must submit a security deposit per missing vehicle. As per the 2024-25 policy, a security deposit was fully refundable at Rs 50,000 per truck. In the new policy drafted in February 2025, security deposit was raised to Rs 1.25 lakh per short vehicle, with Rs 75,000 refundable and Rs 50,000 non-refundable. After their opposition, an amendment was made and security deposit was reduced to Rs 1 lakh per truck, with Rs 85,000 refundable and Rs 15,000 non-refundable. The contractors further demanded the abolition of this additional security deposit, arguing that they already deposited 10 per cent of the contract value as security, making the extra charge an unnecessary financial burden. On their demand, the government further reduced the security deposit fully refundable to Rs 60,000 per short truck.

What was the issue with lifting timelines and penalties?

Under the previous year’s policy 2024-25, the contractors were required to lift the procured wheat within 48 hours, failing which a penalty of Rs 500 per day was imposed but it was mandatory. In February 2025, the penalty was increased to Rs 5,000 per day, which the contractors said was excessive. After protest, the penalty was lowered to Rs 1,000 per day and now further reduced back to Rs 500 per day. The lifting deadline was also changed to 72 hours from 48 hours proposed earlier

.Why did contractors call the negotiation process unfair?

The contractors objected to the new requirement of negotiating with all bidders, arguing that it effectively turned the process into a competitive bidding exercise. They demanded that negotiations should be limited only to the L-1 (lowest bidder) contractor, as was the previous practice. However, no change has been made in it.

Why do contractors blame commission agents for disrupting the system?

The contractors accused arhtiyas (commission agents) in certain mandis of manipulating the system by luring the truck drivers for lifting of foodgrains. Despite the contractors providing sufficient vehicles, delays occur due to the manipulation by the arhtiyas. However, the department did not do anything as it is not a policy matter.

What other amendments have been made to the policy?

Another major concern raised by the contractors was the shortage of foodgrains due to moisture. The new amendment said the shortage of foodgrains, if any would be borne by the arhtiyas if found after first weighment at mandi or weighbridge assigned to Mandi concerned, If the shortage is found after second weighment at the storage point it would be borne by the transporter.