Business

Cabinet approves increase in Food Corporation of India authorised capital

The Union Cabinet has approved to increase the authorised capital of the Food Corporation of India (FCI) to ₹10,000 crore from the current ₹3,500 crore, the government announced on Wednesday.

“With the increase of authorised capital, additional equity capital can be infused in FCI through Union Budget to fund the foodgrains stock perpetually held by FCI,” the government said in a release. “This will reduce the borrowings of FCI, save interest cost of FCI and reduce food subsidy in consequence.”

The Food Corporation of India is required to maintain a perpetual stock of foodgrains, which needs to be funded by the government through an equity or long term loan.

In a separate decision, the Cabinet approved the waiver of repayment of a loan of ₹54 lakh and the interest on that, amounting to ₹370.40 lakh, against the Sikkim Mining Corporation.

“Further accumulation of interest on principal loan will get extinguished and the liquidation process of the Corporation will get completed,” the government said.

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Printable version | Feb 19, 2020 5:55:31 AM | https://www.thehindu.com/business/cabinet-approves-increase-in-food-corporation-of-india-authorised-capital/article30099776.ece

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