Contract of intent buy or sell? Contractor as a supplier or customer?

I am newbie to Projects.
We are implemeting oracle apps for One of Govenrment Client, Government of Gujarat(GOG).
Now GOG, Creates a Project P1 with two tasks Task1(Road Construction 5km) and Task2(Road Construction another 5km). This tasks are to be outsourced to two different contractors
should we define contractor as a customer or supplier
should we create contract of type buy or sell.
Please respond asap as same affects our Go live Milestone.
Vimal K

I'm not sure I could understand the business requirement.
Let's assume GOG has contracted contractor AAA for 100,000 USD.
Over time, that contractor will raise invoices, and GOG, the customer, should pay the supplier invoices.
You are saying that GOG require deposit from the contractor, at the begining of the project. I assume this is a method of guaranty. My understanding is that customer will want to keep that deposit and reduce the amount he is paying to supplier, until the project is finished. Only then the customer will release the deposit and pay it back to the supplier.
The method of reducing payments on invoices and delaying it to future date is usually known as retention. However, Oracle does not support retention functionality for suppliers.

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