New Delhi: The Cabinet Committee on Economic Affairs (CCEA) on Wednesday approved the proposal to increase the authorised capital of Food Corporation of India (FCI) to Rs.10,000 crore.
The current authorised capital of FCI is Rs 3,500 crore.
"The Cabinet Committee on Economic Affairs has approved to increase the authorised capital of Food Corporation of India (FCI) from existing Rs 3,500 crore to Rs 10,000 crore," an official statement said.
"With the increase of authorised capital, additional equity capital can be infused in FCI through the Union Budget to fund the foodgrains stock perpetually held by FCI. This will reduce the borrowings of the FCI, save its interest cost and reduce food subsidy in consequence," it said.
FCI operations require maintaining perpetual stock of foodgrains which needs to be funded by the Centre through equity or long term loans.
The government is providing equity to the FCI for maintaining stocks. The present authorised equity capital of the FCI is Rs 3,500 crore and paid-up equity capital as on March 31, 2019, is Rs 3,447.58 crore, the statement added.