Correct Answer : Rs.21,000 Crore
The government has raised the authorized capital of the state-run Food Corporation of India (FCI) from ?10,000 crore to ?21,000 crore, marking a significant stride in bolstering its operational capabilities.
This initiative, announced by the Food Ministry, underscores the government’s commitment to strengthening FCI’s role in ensuring food security and safeguarding farmers’ interests.
About Food Corporation of India (FCI)
* Establishment and Objectives : Founded in 1965 under the Food Corporation Act, 1964, FCI serves as a statutory body under the Ministry of Consumer Affairs, Food and Public Distribution, Government of India.
* Core Objectives : FCI is entrusted with the tasks of providing price support to farmers by.
1. Procuring grains at Minimum Support Prices (MSP),
2. Supplying grains to Public Distribution System (PDS), and
3. Maintaining strategic grain reserves.
Initiatives to Enhance FCI’s Efficiency
* Integrated IT Systems : FCI is implementing integrated IT solutions and adopting e-office initiatives to transition towards a paperless work environment and streamline operational functions effectively.
* Infrastructure Development : FCI is investing in infrastructure projects such as cement road construction, roof maintenance, and weighbridge modernization to enhance operational efficiency.
* Quality Assurance : Efforts are underway to procure lab equipment and develop software platforms for quality assessment, ensuring adherence to stringent quality standards.
Significance of Increased Authorized Capital :
* Operational Strengthening : The augmentation of authorized capital aims to bolster FCI’s operational efficiency, reduce interest burdens, and positively impact government subsidies.
* Modernization Imperative : In addition to financial infusion, the government emphasizes the modernization of storage facilities, transportation networks, and adoption of advanced technologies for enhanced performance.
* Empowering Farmers : The government’s commitment to MSP-based procurement and investment in FCI’s operational capabilities reflects a collaborative approach towards empowering farmers, fortifying the agricultural sector, and ensuring nationwide food security.
Relevance of FCI
* Bedrock of National Food Security : FCI plays a pivotal role in implementing the National Food Security Act, ensuring procurement and distribution to far-flung areas for national food security.
* Response to Crisis : During crises such as the Covid pandemic and migrant crises, FCI has effectively tackled challenges of hunger and starvation.
* Fight against Malnutrition and Poverty : FCI’s role in the Public Distribution System (PDS) contributes to combating malnutrition and poverty, promoting inclusive growth.
* Support to Farmers : By purchasing crops at MSP, FCI provides financial security to farmers, making agriculture remunerative.
Challenges Faced by FCI
* Limited Farmer Participation : Less than 10% of farmers can sell their produce to government agencies due to various factors such as lack of awareness or access to the MSP system, benefiting only large farmers in certain states like Punjab.
* Storage Overload : FCI has stored double the grains than the prescribed buffer limits, leading to a shortage in the open market, inflation, and deterioration of grains due to limited storage capacity.
* Leakages in Distribution : According to NSSO 2011, 40-60% of grains distributed through the Public Distribution System (PDS) are siphoned off, highlighting significant challenges in distribution efficiency and governance.
