Key Takeaways: - Objectives and Structure of FCI - Roles of FCI - Functions of Various Divisions under FCI - Measures taken by FCI amidst COVID-19

1. Understanding Food Corporation of India
CA Divakar Vijayasarathy

2. Research Credits
Sundar Rajan S
CA Jugal Gala

3. Legends used in the Presentation
CG Central Government
CWC Central Warehousing Corporation
DCP Decentralised Procurement
FCI Food Corporation of India
GOI Government of India
IAS Indian Administrative Service
IRS Indian Revenue Service
OMSS Open Market Sales Scheme
MSP Minimum Support Price
PEG Scheme Private Entrepreneurs Guarantee Scheme
PDS Public Distribution System
SG/ SGA State Government / State Government Agencies
SWC State Warehousing Corporation

4. Presentation Schema
Overview Roles of FCI Procurement Storage
Movement Import and Export
Other Divisions of
FCI
Measures Taken by
FCI amidst COVID-19
Financials of FCI Conclusion

5. Overview

6. Introduction
Food Corporation of India is a statutory body established in 1965 under the Ministry of Consumer Affairs,
Food and Public Distribution, Government of India
It is governed under the Food Corporation Act 1964
FCI was established against the backdrop of major shortage of grains, especially wheat
The head of the FCI is designated as the Chairman
Shri D.V. Prasad, IAS is the incumbent Chairman & Managing Director of FCI
Initial headquarters of FCI was setup in Chennai but later shifted to New Delhi

7. Objective
Effective price support operations for safeguarding the interests of the farmers
Distribution of food grains throughout the country for public distribution system
Maintaining satisfactory level of operational and buffer stocks of food grains to ensure
national food security
Regulate market price to provide food grains to consumers at a reliable price

8. Organisational Structure
FCI has been broadly divided into 5 zones viz. North, South, East, West & North-
East with a Zonal Office in each zone controlled by the Headquarters
Each zone is headed by an Executive Director who is generally from IAS/IRS
Each zone is further divided into regions with a regional office in one region
headed by a General Manager (generally IAS/IRS)
Regional offices are further divided into divisional offices which are headed by
Divisional Managers
Divisional offices are further divided into various depots headed by a Manager
(Depot)

9. Contd.
Headquarters
(New Delhi)
North Zone,
Noida
Regional Offices
(8)
Divisional Offices
Depots
South Zone,
Chennai
Regional Offices
(5)
Divisional Offices
Depots
East Zone,
Kolkata
Regional Offices
(4)
Divisional Offices
Depots
West Zone,
Mumbai
Regional Offices
(4)
Divisional Offices
Depots
North-East Zone,
Guwahati
Regional Offices
(5)
Divisional Offices
Depots
Chairman and Managing Director
Executive
Director
General
Manager
Divisional
Manager
Manager

10. Roles of FCI

11. Procurement

12. Price Support Scheme
FCI along with other State Agencies undertakes procurement of wheat and paddy under price support scheme
Coarse grains (cereals other than rice and wheat) are procured by State Government Agencies for Central
Pool** as per the direction issued by Government of India from time to time
The procurement under Price Support is taken up mainly to ensure remunerative prices to the farmers for
their produce which works as an incentive for achieving better production
Before the harvest during each Rabi (July to October) / Kharif (November to March) Crop season, GOI
announces the minimum support prices* (MSP) for procurement on the basis of the recommendation of the
Commission of Agricultural Costs and Prices (CACP) which, along with other factors, takes into consideration
the cost of various agricultural inputs and the reasonable margin for the farmers for their produce
* Minimum support price is the assured price announced by CG at which food grains are procured from
farmers by CG and SG/SGAs, for the Central Pool. MSP helps to incentivize the farmers and thus ensures
adequate food grains production in the country
**Central Pool refers to the total stock of food grains available for distribution to the consumers through
PDS and Other Welfare Schemes*** and kept as reserves for buffer stock
***Other Welfare Schemes are such Government schemes, in addition to the Targeted PDS, under which
food-grains or meals are supplied as part of the schemes. For e.g. Mid-Day Meal Scheme, Wheat Based
Nutrition Programme, etc.

13. MSP of Food Grains
Marketing
Year
Paddy
Wheat
Jowar
(Maldandi)
Jowar
(Hybrid)
Bajra Ragi Maize Barley
Common Grade 'A'
2010-11 1000 1030 1100 900 880 880 965 880 750
2011-12 1080 1110
Rs.1120/-
(+Rs.50/-
as bonus)
1000 980 980 1050 980 780
2012-13 1250 1280 1285 1520 1500 1175 1500 1175 980
2013-14 1310 1345 1350 1520 1500 1250 1500 1310 980
2014-15 1360 1400 1400 1550 1530 1250 1550 1310 1100
2015-16 1410 1450 1450 1590 1570 1275 1650 1325 1150
2016-17 1470 1510 1525 1650 1625 1330 1725 1365 1225
2017-18 1550 1590 1625 1725 1700 1425 1900 1425 1325
2018-19 1750 1770 1735 2450 2430 1950 2987 1700 1410
2019-20 1815 1835 1840 2570 2550 2000 3150 1760 1440
2020-21 1868 1888 1925 2640 2620 2150 3295 1850 1525
[Rs. Per Quintal (100 Kgs)]
Source: FCI portal

14. System of Procurement
• FCI undertakes procurement directly and jointly with SGAs in non-DCP states
• In the major procuring states like Punjab, MP and Haryana, wheat is mainly
procured by state agencies and they preserve the stocks under their custody for
which carry–over charges are paid to them
• FCI takes over the stocks for dispatching to other consuming states as per
requirement /movement plan
• Payments are made to SGAs as per provisional cost sheets issued by GOI after
taking over the stocks
• In the states like Uttar Pradesh and Rajasthan, the wheat procured by state
agencies is immediately taken over by FCI
• In DCP States like Madhya Pradesh, SGAs procure, store and distribute wheat
within the State
• The excess stocks (wheat) procured by the State /its agencies are handed over
to FCI in Central Pool for distribution/movement to deficit States
Wheat
DCP and non-DCP are types of procurement of food grains by FCI and SGAs (explained subsequently)

15. Contd.
• Custom Milled Rice is manufactured by milling paddy (processing paddy into rice)
procured by SGAs and FCI
• In the states like Andhra Pradesh, Telangana, Punjab, Haryana, Chhattisgarh,
Odisha, Madhya Pradesh, Tamil Nadu, Maharashtra, Uttar Pradesh & Bihar, paddy
is mainly procured by SGAs and the resultant rice is delivered to SG and FCI by
getting the paddy milled from rice millers
Rice
• Coarse grains (cereals other than wheat and rice. E.g. maize, ragi, etc.) are
procured by the SG based on their plan of procurement with prior approval of GOI
& subject to distribution of procured coarse grain under Targeted PDS* in the
procuring state itself
Coarse grains
*Targeted PDS means the system for distribution of essential commodities to the ration card holders through fair
price shops

16. DCP and Non-DCP Procurement
DCP Procurement
• SGAs procure, store and distribute rice /wheat/coarse grains within the State
• The excess stocks (Rice & wheat) procured by the State /its agencies are handed over to FCI
in Central Pool
• The expenditure incurred by SG on procurement, storage and distribution of DCP stocks are
reimbursed by GOI on the laid down principles
• The expenses such as MSP, society commission, administrative charges, mandi labour
charges, transportation charges, custody & maintenance charges, interest charges, gunny
cost, milling charges and statutory taxes are reimbursed on actual basis
• The cost of excess stocks handed over to FCI is reimbursed by FCI to the State
Government/agencies as per GOI costs sheet
Non-DCP
Procurement
(Centralized)
• Under centralized procurement system, the procurement of food grains in Central Pool is
undertaken either by FCI directly or by SGA
• Quantity procured by SGAs is handed over to FCI for storage and subsequent issue against
GOI allocations in the same State or movement of surplus stocks to other States
• The cost of the food grains procured by SGAs is reimbursed by FCI as per Provisional per
cost-sheet issued by GOI as soon as the stocks are delivered to FCI

17. States Procuring Rice/Wheat under DCP System
DCP for Rice
S. No. State With Effect From
1 Uttrakhand 2002-03
2 Chhattisgarh 2001-02
3 Odisha 2003-04
4 Tamilnadu 2002-03
5 West Bengal 1997-98
6 Kerala 2004-05
7 Karnataka 2009-10
8 Madhya Pradesh 2007-08
9 Andhra Pradesh Fully DCP for KMS 2015-16
10 Bihar 2013-14
11. Telangana Fully DCP from KMS 2014-15
12. Maharashtra 2016-17
13. Jharkhand 2016-17(only for 1 district), 2017-18 (only
for 5 Districts), 2018-19 (only for 6 Districts)
14. Gujarat 2017-18
15 Andaman Nicobar 2003-04
16. Tripura KMS 2018-19 and KMS 2019-20 (Rabi Crop)
DCP for Wheat
S. No. State With Effect From
1 Madhya Pradesh 1999-2000
2 Uttrakhand 2003-04
3 Chattisgarh 2001-02
4 Gujarat 2004-05
5 West Bengal 2010-11
6 Bihar 2014-15
7 Maharashtra 2020-21
KMS stands for Kharif Market Season (1st October to 30th September)
Source: FCI portal

18. Storage

19. Functioning of Storage
The storage function assumes paramount importance in FCI because of its requirement to hold
huge inventory of food grains over a significant period of time
Storage plan of FCI is primarily to meet the storage requirement for holding stocks and to meet the
requirements of PDS and Other Welfare Schemes undertaken by GOI
Also, buffer stock is to be maintained for ensuring food security of the nation
Adequate scientific storage is pre-requisite to fulfil the policy objectives assigned to FCI for which it
has a network of strategically located storage depots including silos (a large structure, usually
cylindrical, used for storing grain) all over India
Besides having own storage capacity, FCI has hired storage capacities from Central Warehousing
Corporation, State Warehousing Corporations, State Agencies and Private Parties for short term as
well as for guaranteed period under Private Entrepreneurs Guarantee Scheme
New godowns are being constructed by FCI mainly through Private Participation under Private
Entrepreneurs Guarantee Scheme

20. Private Entrepreneurs Guarantee (PEG) Scheme
PEG Scheme was formulated in 2008, for construction of storage godowns in Public Private Partnership (PPP) mode
through private entrepreneurs, CWC and SWCs to overcome storage constraints and ensure safe stocking of food
grains across the country
Assessment of additional storage capacities required under the scheme is based on the overall procurement/
consumption pattern and storage space already available
Under PEG scheme, no funds are allocated by Government for construction of godowns and full investment is done
by the private parties/CWC/State Agencies by arranging their own funds and also the land
After a godown is constructed and taken over, FCI gives a guarantee of rent for 10 years in the case of private
investors and for 9 years in case of CWC/SWCs/State Agencies, irrespective of quantum of food grains stored
Out of a sanctioned capacity of 152.30 Lakh Tonnes under the PEG scheme, a storage capacity of 143.83 Lakh
Tonnes has been completed as on 31st May 2020

21. Total Stocks of Food Grains in Central Pool
Zone Stock with FCI Stock with SGAs Total Central Stock Pool
Rice Wheat Total Rice Wheat Total Rice Wheat Total
East 9.87 10.63 20.50 10.21 0.04 10.25 20.08 10.67 30.75
North-East 3.52 0.14 3.66 0 0 0 3.52 0.14 3.66
North 151.74 101.65 253.39 0.45 233.44 233.89 152.19 355.09 487.28
South 36.82 2.29 39.11 28.50 0 28.50 65.32 2.29 67.61
West 13.35 19.75 33.10 12.10 161.83 173.93 25.45 181.58 207.03
Total 215.30 134.46 349.76 51.26 395.31 446.57 266.56 529.77 796.33
(Fig. in Lakh Tonnes)
AS ON 31.05.2020
Source: Department of Food and Public Distribution (DFDP) portal

22. Storage Capacity for Central Pool Stocks
As on Capacity with FCI Storage Capacity Other Agencies Total
01-04-2011 316.10 291.32 607.42
01-04-2012 336.04 341.35 677.39
01-04-2013 377.35 354.28 731.63
01-04-2014 368.90 379.18 748.08
01-04-2015 356.63 352.59 709.22
01-04-2016 357.89 456.95 814.84
01-04-2017 352.71 420.22 772.93
01-04-2018 362.50 480.53 843.03
01-04-2019 388.65 467.03 855.68
30-04-2020 412.31 344.22 756.53
(in Lakh Tonnes)
Source: FCI portal

23. Storage Capacity Created under PEG Scheme
State-wise and year-wise details of the storage capacity created under PEG scheme
(Fig. in Lakh Tonnes)
Sl.
No
State 2010
-11
2011
-12
2012-
13
2013-
14
2014-1
5
2015-
16
2016-1
7
2017
-18
2018-
19
2019-
20
2020-21
(up to 31.
05.2020)
Total
1 2 3 4 5 6 7 8 9 10 11 12 13 14
1 Andhra Pradesh 0.72 0 0.16 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.88
2 Bihar 0.1 0.12 0.58 0.50 0.48 1.07 0.45 0.10 0.15 0.00 3.55
3 Chhattisgarh 0.05 0.7 1.73 1.78 0.24 0.76 0.12 0.00 0.00 0.00 0.00 5.37
4 Gujarat 0.05 0.45 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.50
5 Haryana 0.28 5.31 8.77 15.48 3.98 0.55 0.00 0.00 0.00 0.33 0.00 34.69
6 H.P. 0.025 0.22 0.00 0.00 0.00 0.00 0.00 0.22 0.00 0.46
7 J & K 0.1 0.3 0.53 0.26 0.09 0.08 0.20 0.07 0.10 0.00 1.72
8 Jharkhand 0.1 0.70 0.20 0.13 0.15 0.65 0.40 0.15 0.20 2.68
9 Karnataka 0.53 0.69 0.67 0.15 0.37 0.00 0.00 0.00 0.00 0.00 2.41
10 Kerala 0.05 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.05

24. Contd.
Sl.
No
State 2010-
11
2011-
12
2012-
13
2013-1
4
2014-
15
2015
-16
2016-
17
2017-
18
2018-
19
2019-
20
2020-21
(up to
31.05.2020)
Total
11 M.P. 0.33 1.59 8.84 0.00 0.96 0.95 0.21 0.15 0.00 0.00 13.03
12 Maharashtra 0.17 0.38 1.38 3.15 0.30 0.25 0.00 0.00 0.00 0.00 0.00 5.63
13 Odisha 0.3 1.02 0.72 0.45 0.00 0.45 0.10 0.20 0.28 0.00 0.00 3.53
14 Punjab 1.04 14.05 18.28 8.44 1.08 1.39 0.40 0.00 0.00 0.00 0.00 44.69
15 Rajasthan 0.2 1.43 0.57 0.00 0.00 0.00 0.15 0.00 0.00 0.00 2.35
16 Tamil Nadu 0.6 0.2 0.75 0.00 0.05 0.40 0.55 0.00 0.00 0.00 2.55
17 Telangana 0.75 0.53 1.41 0.00 0.00 0.00 0.00 0.00 0.30 0.00 2.99
18 Uttar Pradesh 0.07 4.53 6.06 1.46 0.45 0.46 1.25 0.36 0.22 0.00 0.10
19 Uttarakhand 0 0.00 0.00 0.00 0.10 0.00 0.00 0.00 14.86
20 West Bengal 0.21 0.39 0.22 0.45 0.17 0.05 0.05 0.00 0.00 1.54
21 Assam 0.25 0.00 0.00 0.00 0.25
22 Meghalaya - - - - - - - - - - - -
Total 1.84 24.86 40.71 50.63 8.39 6.38 3.90 4.06 1.40 1.47 0.20 143.83
(Fig. in Lakh Tonnes)
Source: Department of Food and Public Distribution (DFDP) portal

25. Movement

26. Movement of Food Grains
FCI’s Sales division looks after the distribution of food grains under Targeted PDS and Other Welfare Schemes.
FCI undertakes movement of food grains in order to:
• Evacuate stocks from surplus regions
• Meet the requirements of deficit regions for Targeted PDS and Other Schemes
• Create buffer stocks in deficit regions
Punjab, Haryana and Madhya Pradesh are the surplus States in terms of wheat procurement vis-a-vis their own
consumption
Punjab, Haryana, Andhra Pradesh/ Telangana, Chhattisgarh and Odisha are surplus States in terms of rice
procurement vis-à-vis their own consumption
Surplus stocks of wheat and rice available in these States are moved to deficit States to meet the requirements
under Targeted PDS and other schemes as well as to create buffer stocks
On an average 40 to 42 million tonnes of food grains are transported by FCI across the country in a year
FCI undertakes massive movement operation of food grains all over the country encompassing around 1906 FCI
owned & hired depots/Silos, 557 rail-heads (owned by Indian Railways and others) and 98 FCI own sidings

27. Mode of Transportation
Movement of food grains is undertaken by Rail, Road and Waterways
Around 85% of stocks are moved by rail to different parts of the country
Inter-State movement by road is mainly undertaken in those parts of the country which are not connected by rail
A small quantity is also moved by ocean vessels to Lakshadweep and Andaman & Nicobar Islands as well as
through coastal shipping and riverine movement to Kerala/Agartala (Tripura)
FCI has 98 own Rail sidings, where food grain rakes (railway carriages) are placed directly at FCI depots. Other than
that, food grain stocks are transported ‘to and fro’ from the nearest rail-heads of Indian Railways
FCI has been able to ensure availability of sufficient food grain in all States by proper planning. About a decade
back, nearly 90% of stocks were moved Ex-North mainly from Punjab & Haryana, which has now come down to
72% due to increase in procurement of rice in Andhra Pradesh, Chhattisgarh, Odisha & West Bengal and wheat in
Madhya Pradesh, Uttar Pradesh and Rajasthan

28. Import and Export

29. Functions of Import and Export Division
Import and Export Division undertakes the work of Export and Import of food grains as per the guidelines,
policy and instructions of GOI
The various functions of Import Export Division, inter alia, include the following:
1. Import and Export of food grains (mainly Wheat and Rice) and issue of stocks under various schemes
of World Food Program/ Government aid on donation basis to other countries
2. Assisting the Ministry of Consumer Affairs & Public Distribution in formulation of policies regarding
import and export of wheat and rice
3. Formulating guidelines/procedures to be followed in import/export of food grains in accordance
with policy decision of GOI and forwarding the same to all concerned field offices for necessary
compliance
4. Preparation of agenda/Information/data for meeting of High level Committee for day to day
monitoring and resolving of operational issues during import/export of food grains
5. Keeping watch on International demand and supply situation as well as price, in relation to Wheat
and Rice

30. Export of Food Grains (Including Donation)
Year Wheat Rice
2015-16 - 100.16
2016-17 - 19,980
2017-18 1,10,000 2,100
2018-19 - -
2019-20 1584.117 -
(Fig. in Tonnes)
• There was no import of food grains from the year 2008-09 onwards
Source: FCI portal

31. Functions of Other Divisions of FCI

32. Other Divisions of FCI
Quality Control Division Engineering Division Vigilance Division
Sales Division Information Technology Division
The various other divisions under FCI include the following:

33. Quality Control Division
Quality Control
• It is entrusted with enormous task of procurement & preservation of food grains
• The food grains are procured as per laid down Specifications of GOI and inspected
regularly during storage to monitor the quality
• FCI's testing laboratories are spread across the country for effective monitoring of
quality of food grains providing quality assurance as per Food Safety and Standards
Act, 2006, leading to improved satisfaction level to the consumers
• Laboratories across the country are being upgraded with latest equipment
• The Institute of Food Security (IFS) Lab, Gurgaon is in process of upgradation to a
State of Art Lab
Financial Year No of Depot Labs
2015-16 07
2016-17 02
2017-18 02
2018-19 06
Laboratories that have been established by the FCI

34. Engineering Division
Functions of Engineering Division of FCI, inter alia, include the following:
1. Construction and maintenance of covered godowns
2. Up-gradation & maintenance of own railway sidings
3. Construction and maintenance of Internal & External Electrical Installation in godowns
4. Upgradation of existing weighbridges to fully electronic, enhancement of capacity of
weighbridges as well as installation of new additional weighbridges as per the requirement

35. Vigilance Division
Vigilance Division of FCI is headed by Chief Vigilance Officer who is assisted by a team of officers of various ranks
The offices of FCI at Zonal and Regional level too have vigilance set up headed by officers of suitable rank which
assists the Zonal Executive Directors and General Managers, as the case may be
Functions performed by the Vigilance Officer, inter alia, include the following:
• Collecting intelligence about the corrupt practices committed, or likely to be committed by the employees of
his organisation
• Investigating or causing an investigation to be made into verifiable allegations reported
• Processing investigation reports for further consideration of the disciplinary authority concerned
• Referring the matters to FCI for advice wherever necessary
• Taking steps to prevent commission of improper practices/misconducts, etc.

36. Measures taken by FCI amidst Covid-19
• During the lockdown, NGOs and social institutions running relief camps are allowed to
purchase wheat and rice directly from FCI Depots at Open Market Sales Scheme* (OMSS) rate
• The State Governments can also purchase food grains directly from FCI
• Under the OMSS, the rates of Rice is fixed at Rs.22/kg and Wheat- Rs.21/kg
• Meanwhile, FCI has sold 4.68 Lakh Tonnes wheat and 6.58 Lakh Tonnes rice through OMSS
during the lockdown period
Open
Market Sales
Scheme
• This Scheme aims at ensuring sufficient food with the poor and needy during the COVID crisis
• The food grains were to be distributed to all the beneficiaries under the Targeted PDS for
Antyodaya Anna Yojana (AAY) and priority household (PHH) ration cardholders
• The eligible individuals were to receive 5 kgs of food grains and 1 kg of pulses per month for a
period of three months between April and June, 2020
• This benefit has now been extended by GOI for 5 more months i.e. till November 2020
• FCI assumes significant role in implementation of this Scheme
Pradhan
Mantri Garib
Kalyan Anna
Yojana
*OMSS refers to selling of food grains by Government / Government agencies at predetermined prices in the open
market from time to time to enhance the supply of grains especially during the lean season (period between
planting and harvesting) and thereby to moderate the general open market prices especially in the deficit regions

37. Financials of FCI

38. Balance Sheet of FCI as at 31-03-2018

39. Contd.

40. Statement of P&L for the year ended 31-03-2018

41. Capital Structure

42. Turnover

43. Conclusion
FCI plays a significant role in protecting and improving the welfare of the farmers in the country
It also takes responsibility in delivering food grains at subsidised prices to the needy people
Going forward, FCI should adopt effective systems to optimize the utilization of storage capacities
Additionally, it should adopt strong controls to ensure that the food grains are distributed to the
intended consumers without any gaps or irregularities

44. Thank You!
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