Govt raises authorised capital of FCI from Rs 10,000 cr to Rs 21,000 cr

With this infusion of capital, the FCI should embark upon modernising its storage facilities, improving transportation networks, and adopting advanced technologies

Published - February 17, 2024 10:47 pm IST - New Delhi

File photo

File photo | Photo Credit: SRINATH M

The government has increased the authorised capital of state-run Food Corporation of India (FCI) from ₹10,000 crore to ₹21,000 crore to enhance the operational capabilities and fulfill its mandate effectively, the Food Ministry said on February 17.

FCI is the central government's nodal agency that undertakes the procurement of foodgrains at a minimum support price (MSP) to protect the interest of farmers. It also maintains strategic stocks and distributes the grains under different welfare schemes.

"The increase in authorised capital is a significant step towards enhancing the operational capabilities of FCI in fulfilling its mandate effectively," the Ministry said in a statement. FCI resorts to cash credit, short-term loan, ways and means etc. to match the gap in the fund requirement. The increase in the authorised capital will reduce the interest burden, decrease the economic cost and ultimately affecting the government subsidy positively, it said.

With this infusion of capital, the FCI should also embark upon modernising its storage facilities, improving transportation networks, and adopting advanced technologies.

These measures are essential not only for reducing post-harvest losses but also for ensuring efficient distribution of food grains to consumers, it added.

Creating capital assets

The Centre provides equity to the FCI for working capital requirements and the creation of capital assets. The FCI is undertaking a comprehensive initiative to create an integrated IT system, leveraging existing internal and external systems.

Through the e-office implementation, FCI is making efforts towards a paperless office culture. These initiatives of integrated IT solutions serving as the core operational software for FCI, should provide a single source of information and streamline functions with a common digital backbone.

According to the Ministry, the FCI has taken several steps to enhance its efficiency including construction of cement roads, roof maintenance, illumination, and weighbridge upgradation.

Besides, it has also purchased lab equipment and developed a software platform for quality checking.

The government's dual commitment to MSP-based procurement and investment in FCI's operational capabilities signifies a collaborative effort towards empowering farmers, fortifying the agricultural sector, and ensuring food security for the nation, it said.

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