NEW DELHI: The Cabinet on Wednesday approved Rs 10,700 crore equity infusion in Food Corporation of India (FCI) for working capital requirement during the current financial year, which will reduce the interest burden by around Rs 800 crore annually and thereby cut down govt's subsidy outgo.
The decision is aimed at bolstering the agricultural sector and ensuring the welfare of farmers nationwide, govt said. "This strategic move shows govt's steadfast commitment to supporting farmers and fortifying India's agrarian economy," it added.
FCI started its journey in 1964 with authorised capital of Rs 100 crore and equity of Rs 4 crore. Its operations increased manifolds resulting in increase of authorised capital from Rs 11,000 crore to Rs 21,000 crore in Feb 2023. "Now, govt has approved a significant amount of equity of Rs 10,700 crore for FCI which will strengthen it financially and will give a big boost to the initiatives taken for its transformation," the official statement said.
The food ministry said infusion of equity is a significant step towards enhancing FCI's operational capabilities in fulfilling its mandate effectively. "FCI resorts to short-term borrowings to match funding gaps. This infusion will help to lower the interest burden and will reduce the subsidy of govt ," govt said.
The decision is aimed at bolstering the agricultural sector and ensuring the welfare of farmers nationwide, govt said. "This strategic move shows govt's steadfast commitment to supporting farmers and fortifying India's agrarian economy," it added.
FCI started its journey in 1964 with authorised capital of Rs 100 crore and equity of Rs 4 crore. Its operations increased manifolds resulting in increase of authorised capital from Rs 11,000 crore to Rs 21,000 crore in Feb 2023. "Now, govt has approved a significant amount of equity of Rs 10,700 crore for FCI which will strengthen it financially and will give a big boost to the initiatives taken for its transformation," the official statement said.
The food ministry said infusion of equity is a significant step towards enhancing FCI's operational capabilities in fulfilling its mandate effectively. "FCI resorts to short-term borrowings to match funding gaps. This infusion will help to lower the interest burden and will reduce the subsidy of govt ," govt said.
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