FCI seeks `50,000 crore for foodgrain operations

FCI plans massive short-term borrowing amid rising wheat procurement and expanding nationwide foodgrain distribution operations

The Food Corporation of India (FCI) plans to raise short-term loans worth ₹50,000 crore from scheduled banks to manage cash flow requirements linked to procurement and distribution of foodgrains, a senior government official said on Monday.

The borrowing will have a tenure of three months and includes a green shoe option allowing the agency to raise an additional ₹25,000 crore if required. 

However, total borrowings under the tender will not exceed ₹75,000 crore at any point of time. According to the official, the funds are being mobilised mainly to bridge temporary cash flow mismatches arising during procurement operations and foodgrain distribution under welfare schemes. Tenders for the proposed borrowing are scheduled to open on May 22. The loans will be unsecured in nature, and the existing Government of India guarantee of ₹6,000 crore available for food credit to FCI will not cover these borrowings. The tender conditions specify that offers submitted by banks must remain valid till August 31. 

Loan disbursals will also be made in phases depending on FCI’s operational requirements. The development comes at a time when FCI is actively procuring wheat for the 2026-27 marketing season. Along with state agencies, the corporation has procured 22.97 million tonnes of wheat from farmers so far at the minimum support price.

 Punjab has emerged as the largest contributor with procurement of 10.51 million tonnes, followed by Madhya Pradesh at 6.72 million tonnes, Haryana at 2.58 million tonnes, and Rajasthan at 1.77 million tonnes. The government has fixed a wheat procurement target of 34.49 mn tonnes for the current marketing season. 

 FCI plays a critical role in maintaining food security by procuring grains from farmers and supplying foodgrains through ration shops and welfare programmes across the country. 

 The corporation’s borrowing plan also reflects the government’s continued focus on strengthening food security and maintaining buffer stocks.

—Informist