A push for FCI modernisation - Hindustan Times
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A push for FCI modernisation

ByHT Editorial
Apr 22, 2024 10:59 PM IST

Injection of funds can improve the efficiency of food procurement and distribution system

India’s farm output has increased from a mere 50 million tonnes in 1950-51 to over 300 million tonnes in 2022-23, helping to avoid a scary Malthusian world of food production not keeping pace with population growth. In 2009, when the country saw its worst drought in three decades, it still managed to produce a million more tonnes of food grains than it did in 2007, a normal year. In the British period, drought was synonymous with famines, which would kill hundreds of thousands. Therefore, it would not be an exaggeration to say that one of the greatest successes of food policy anywhere is India’s Green Revolution of the 1960s-70s. It not only brought together the right mix of incentives and subsidies to increase food production but also came up with ways to store grain safely in state-owned granaries and distribute them across the country. Agencies, such as the United Nations’ Food and Agricultural Organization, have hailed India’s ability to sustain its food mission even during the Covid-19 pandemic, preventing death and hunger.

FCI, a state-owned corporation through which 70% of federal food subsidies are routed, is critical for the country’s food security as it procures millions of tonnes of farm produce at federally fixed minimum support prices (HT File) PREMIUM
FCI, a state-owned corporation through which 70% of federal food subsidies are routed, is critical for the country’s food security as it procures millions of tonnes of farm produce at federally fixed minimum support prices (HT File)

The lynchpin of the country’s behemoth food distribution network, which reaches 800 million poor Indians, is the Food Corporation of India (FCI). An organisation central to India’s food security, FCI has rightly embarked upon a mission to modernise all aspects of its operations and become a corporate entity, rather than merely being another sarkari institution marked by large inefficiencies. Through a recent notification, the Centre has raised the authorised working capital of FCI to 21,000 crore from 10,000 crore, the biggest hike ever, which in official circles is being described as a “strategic step towards enhancing the operational capabilities of the FCI in fulfilling its mandate effectively”.

FCI, a state-owned corporation through which 70% of federal food subsidies are routed, is critical for the country’s food security as it procures millions of tonnes of farm produce at federally fixed minimum support prices (MSP). Capital injection of 21,000 crore will streamline its finances by reducing the need for debt and funding a digitisation drive. On the cards is an integrated countrywide digital platform that will plug gaps in inventory management. The agency is already working on harnessing artificial intelligence to detect fraud by stakeholders in grain handling. In concrete terms, FCI’s modernisation bid is a quest to bring efficiency to its operations, a goal every state-owned enterprise should chase.

 

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