Shall I understand the matter as follows?
A company has won a contract for the supply of manpower to another organization aided by the government. You have 'employed' an 'expert' as a consultant to work 'exclusively' for you. The government will not grant any leaves or other benefits to any employee who works for the project.
Yes, the government is not the employer (not even the principal employer) because the role of the government is just to provide financial aid to the project management unit. But at the same time, the project management unit is the principal employer who has engaged (your) company to supply manpower.
Now the 'expert' is working for the project management unit, the principal employer, and the salary and perks are given by you, the contractor, right? The project management unit will not give any leave to the 'expert' deployed by you, BUT he is an employee under your rolls and as such, YOU are responsible to grant him leave and other benefits.
Very simple, the term contractor or employment contract is a relative term and can only be used in relation to another organization for which the workers/employees of the contractor will work. If you are supplying your manpower to another unit, then the unit which gets the services of your employees is the principal employer and you are the contractor. A contract worker (worker shall include all designations, including manager, consultants, or experts if they work exclusively for you and spend 8 hours with you like any other worker of your organization) is an employee of any organization, i.e., a contractor in relation to the principal employer, and as such, he should get the leaves as per that organization. If the contractor is registered as a commercial establishment, all the employees, whether they work for the contractor in the contractor's office or on-site of others, principal employers, should get leaves as per the Shops and Commercial Establishments Act of the state. As such, extend it to the 'experts' also.
Please remember that a consultant is one who is contacted for certain technical, legal, financial, or other advice, and he will never work like other employees following the office timings, leave rules, and other HR protocols. If your consultant is expected to work like others, then the term to describe him is not a consultant but an EMPLOYEE only.