The Cabinet Committee on Economic Affairs (CCEA), led by Prime Minister Narendra Modi, has approved an equity infusion of Rs 10,700 crore for the Food Corporation of India (FCI) for the fiscal year 2024-25. This capital support, converted from the Ways and Means Advance (WMA), is intended to reinforce FCI’s operational capacity and to bolster India’s agricultural sector by ensuring sustainable support to farmers and strengthening food security.
FCI, which commenced its operations in 1964 with an initial authorised capital of Rs 100 crore, has seen significant expansion over the years. Recently, in February 2024, its authorised capital was increased from Rs 11,000 crore to Rs 21,000 crore, while its equity grew from Rs 4,496 crore in 2019-20 to Rs 10,157 crore by 2023-24. The latest equity infusion of Rs 10,700 crore is expected to enhance FCI’s financial stability and support its transformation initiatives.
The FCI plays a key role in India’s food security by procuring food grains at the Minimum Support Price (MSP), managing strategic food stocks, and distributing grains for welfare programmes and price stabilisation. By boosting FCI’s working capital, this equity infusion will reduce its reliance on short-term borrowings, lowering the interest burden and eventually reducing the government’s subsidy costs.
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The decision underscores the government’s dual commitment to MSP-based procurement and to strengthening FCI’s ability to carry out its core functions. Through strategic investment in FCI, the government aims to empower farmers, reinforce the agricultural sector, and ensure consistent food security across the nation.
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