New Delhi

The Government has announced an increase in the authorized capital of the Food Corporation of India (FCI) from Rs 10,000 crore to Rs 21,000 crore in a major step to bolster the agricultural sector and benefit farmers.

The FCI plays a key role in the country’s food security system, including the procurement of food grains at Minimum Support Price (MSP), maintenance of strategic food grain stocks, distribution to state governments and Union Territories (UTs), and stabilization of food grain prices in the market.

The more than two-time increase in the authorized capital is a significant step towards enhancing the operational capabilities of FCI in fulfilling its mandate effectively, the Ministry of Consumer Affairs, Food and Public Distribution said on Saturday.

To match the gap of fund requirement, FCI resorts to cash credit, short term loans, ways & means advances, an increase of authorized capital and further infusion will reduce the interest burden, reducing the economic cost and ultimately bring down the subsidy of the government as well.

With this infusion of capital, FCI will also embark upon modernizing 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, the ministry said.

The Government provides equity to FCI for working capital requirement and for creation of capital assets. FCI is undertaking a comprehensive initiative to create an Integrated IT system, leveraging existing internal systems (FAP, HRMS) and external systems (State procurement portals, CWC/SWC).