Approval for infusion of equity in Food Corporation of India for working capital

07-Nov-2024 04:00 PM

New Delhi. The Union Cabinet Committee on Economic Affairs (CCEA) has approved the infusion of equity of Rs 10,700 crore in the government agency - Food Corporation of India (FCI) for the current financial year (2024-25) to meet the working capital needs of the corporation.

This equity has been presented by converting Wages and Means Advance into equity. Actually, Wages and Means Advance (WMA) is a temporary loan given by the government to FCI to help the corporation bridge the gap between government receipts and payments.

The Food Corporation has to repay this WMA by March 31 in the same financial year. The interest rate for this loan remains the same as the weighted average interest rate for 364-day treasury bills for the relevant financial year.

An official statement said that now the Government of India has approved a huge amount of equity of Rs 10,700 crore for FCI, which will strengthen the financial position of the Food Corporation and support its efforts and activities.

It is worth mentioning that Food Corporation of India is the main government agency for the purchase and storage-distribution of food grains and every year it has to spend a huge amount on the purchase of paddy (rice) and wheat and other grains.