Ministry of Railways (GODL-India)
Cabinet Approves ₹10,700 Crore Equity Infusion for FCI’s FY25 Operations
The Union Cabinet has approved a substantial equity infusion of ₹10,700 crore into the Food Corporation of India (FCI) for the financial year 2024-25.
The decision, taken at a meeting of the Cabinet Committee on Economic Affairs (CCEA) chaired by Prime Minister Narendra Modi, aims to strengthen FCI’s financial base and operational efficiency.
Boost to FCI’s Operational Capacity
Union Minister Ashwini Vaishnaw announced the decision, stating, “Cabinet approves infusion of equity of Rs 10,700 crore for working capital in financial year 2024-25 in Food Corporation of India (FCI).” He added that over the last decade, FCI’s operations have expanded due to increased Minimum Support Price (MSP) rates and greater procurement of food grains.
This equity injection will reduce FCI’s dependency on short-term borrowings, lowering its interest costs and subsequently reducing the government’s subsidy burden. By supporting FCI’s operational capabilities, the government aims to enhance the organisation’s ability to procure, store, and distribute food grains efficiently.
The Role and Expansion of FCI
Established in 1964 with an initial authorised capital of ₹100 crore, FCI has significantly grown over the years, with its capital now raised to ₹21,000 crore as of February 2023. FCI is central to India’s food security mission, procuring food grains at MSP, managing strategic stock reserves, and ensuring distribution to meet the objectives of the National Food Security Act. With this additional ₹10,700 crore equity infusion, FCI’s total equity will reach a new high, enhancing its capacity for national food distribution and stabilisation efforts.
FCI currently procures around 60% of its grain stocks from surplus regions and transfers them to deficit areas, bridging regional food supply gaps. This financial boost will enable FCI to continue supporting food security in a sustainable way, fulfilling its role as a cornerstone of India’s welfare and price stabilisation programs.
