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Role of fci in food security

The Role Food Corporation of India to handle a large and delicate nation.

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Role of fci in food security

  1. 1. Made by – Shivam Mishra
  2. 2. Food Corporation of India (Hindi: भारतीय खाद्य निगम) was set up on 14 January 1965 having its first District Office at Thanjavur - rice bowl of Tamil Nadu - and headquarters at Chennai under the Food Corporations Act 1964 to implement the following objectives of the National Food Policy : 1)Effective price support operations for safeguarding the interests of the farmers 2)Distribution of food grains throughout the country for Public Distribution System 3)Maintaining satisfactory level of operational and buffer stocks of food grains to ensure National Food Security 4)Regulate market price to provide food grains to consumers at a reliable price
  3. 3. It is the duty of FCI India to create various warehouses for the storage of the food grains. Food corporation of India is providing food grains in a wider range covering all the sections of the society at an affordable price. FCI India is running the following functions:- It entirely focuses on supporting the farmers in providing the food grains to large number of public in a more well and efficient way for today and tomorrow. Food is the basic need which constitutes the requirement of the human being. It comes under the Food corporation of India Functions to preserve and store the large quantity of food grains and spreading it over the large and vast areas. To arrange the transport facilities to produce agricultural seeds, manures and fertilizers from warehouses.
  4. 4.  It is the function of FCI India to distribute and supply food grains through rations shops which comes under Food corporation of India act.  Food corporation of India Functions for the betterment of the society considering large masses.  Food corporation of India Functions the sale of food grains and its movement mainly depends on the rail being a deficit country.  It again comes under the Food corporation of India functions to enhance the crop production.  The FCI pays the farmers at a price that is already fixed by the government which is called Minimum Support Price(MSP). MSP is announced by the government every year before the sowing season. Therefore, the announcement of the price helps farmers to plan their agricultural activity and increase production.
  5. 5.  As explained above, buffer stocks are required to ensure food security during the periods when production is short of normal demand during bad agricultural years and stabilize prices during period of production shortfall through open market sales.  FCI stores its purchases in granaries which belong to the government.  The excess stock held by FCI is called buffer stock.  The buffer stock is distributed to poor people where there is shortage of food.  A very reasonable price is fixed as the selling price. This price is known as the issue price.  There are about 4.6 lakh ration shops all over the country. These shops sell essential items like food grains, sugar and Kerosene oil for cooking. The price of these items is much lower than the market price.
  6. 6.  It is one of the largest corporations in India and probably the largest supply chain management in Asia (Second in world ). Each year, the FCI purchases roughly 15 to 20 per cent of India's wheat output and 12 to 15 per cent of its rice output. The purchases are made from the farmers at the rates declared by the Govt. of India. There is no limit for procurement in terms of volume, any quantity can be procured by FCI provided the stock satisfies FAQ (Fair Average Quality) specifications with respect to FCI.
  7. 7. The stocks are transported throughout India and issued to the State Government nominees at the rates declared by the Govt of India for further distribution under the Public Distribution System (PDS) for the consumption of the ration card holders. (FCI itself does not directly distribute any stock under PDS and its operations end at the exit of the stock from its depots).
  8. 8. FCI by itself is not a Decision making authority, it does not decide anything about the MSP, Imports or Exports. It just implements the decisions made by the Ministry of Food and Ministry of Agriculture