FCI to invite suggestions on its restructuring

On Aug 20, the Centre had set up a high-level committee to suggest various models to restructure the FCI

The high level committee, set up to recommend ways to restructure state-run FCI, today decided to invite suggestions from public and stakeholders, including private sector firms, on management of foodgrains.

Food Corporation of India (FCI) is the nodal agency for procurement and distribution of foodgrains. On August 20, the Centre had set up a high-level committee to suggest various models to restructure the FCI, which plays a key role in strengthening public distribution system (PDS).

"This was our first meeting and we discussed a number of issues at length," said former food minister Shanta Kumar, who is Chairman of the committee.

In the meeting it was decided to invite suggestions from the public and stakeholders on restructuring its key functions with a view to further strengthening and integrating the supply chain of foodgrains, according to an official statement.

The meeting also decided to invite private sector firms to make a presentation on 'International Best Practices in Storage and Handling of Foodgrains' before the committee in its next meeting on September 15.

The stake-holders from whom FCI would elicit responses, include NGOs, farmer associations, rice and flour millers, handling and transport contractors, government bodies associated to food management, agriculture, storage and logistics.

Meanwhile, sources said economists and academicians, who are members of the committee, are of the view of that more private participation in areas of storage and distribution of grains need to be explored to avoid wastage and bring in cost efficiency.

Sources also added during the deliberations a point was also raised that there is a need to explore the option of paying subsidy directly to the beneficiaries and involve private parties in distribution of foodgrains.

The meeting was attended by all the members including FCI Chairman and Managing Director C Viswanath, Secretary Electronics & IT Ram Sewak Sharma, former CACP Chairman Ashok Gulati and Dean IIM Ahmedabad G Raghuram.

Dean, School of Economics, University of Hyderabad, Gunmadi Nancharaiah, Punjab Food Secretary D S Grewal were among other members who were present in the meeting.

The meeting was also attended by the all executive directors of the corporation.

During the meeting FCI officials presented constraints faced by them. They said of the total funds allocated to them only 2%, which is the administrative cost, is under their control and the remaining 98% depends on minimum support price (MSP).