Examine the financial and operational constraints of the Food Corporation of India (FCI) in fulfilling its mandate. How can increased government investment and capacity expansion address these challenges effectively?
Kartavya Desk Staff
Topic: Public Distribution System- objectives, functioning, limitations
Topic: Public Distribution System- objectives, functioning, limitations
Q5. Examine the financial and operational constraints of the Food Corporation of India (FCI) in fulfilling its mandate. How can increased government investment and capacity expansion address these challenges effectively? (15 M)
Difficulty Level: Medium
Reference: TH
Why the Question Centre infuses equity of ₹10,700 crore in Food Corporation of India. Key Demand of the Question Identify and explain financial and operational constraints of the FCI in fulfilling its mandate. Discuss how government investment and capacity expansion can effectively resolve these challenges. Structure of the Answer Introduction Briefly introduce the role of the FCI in ensuring food security and supporting agricultural markets. Body Financial Constraints: Outline FCI’s dependence on borrowing, subsidy pressures, and high operational costs. Operational Constraints: Discuss issues like limited storage capacity, delays in procurement, and logistics challenges. Role of Government Investment: Explain how increased funding reduces borrowing needs and enhances fiscal health. Capacity Expansion: Discuss how enhancing storage and procurement capabilities can improve FCI’s efficiency and reduce wastage. Conclusion Emphasize how addressing these constraints through investment and expansion will enhance food security and benefit farmers.
Why the Question
Centre infuses equity of ₹10,700 crore in Food Corporation of India.
Key Demand of the Question
Identify and explain financial and operational constraints of the FCI in fulfilling its mandate. Discuss how government investment and capacity expansion can effectively resolve these challenges.
Structure of the Answer
Introduction
Briefly introduce the role of the FCI in ensuring food security and supporting agricultural markets.
• Financial Constraints: Outline FCI’s dependence on borrowing, subsidy pressures, and high operational costs.
• Operational Constraints: Discuss issues like limited storage capacity, delays in procurement, and logistics challenges.
• Role of Government Investment: Explain how increased funding reduces borrowing needs and enhances fiscal health.
• Capacity Expansion: Discuss how enhancing storage and procurement capabilities can improve FCI’s efficiency and reduce wastage.
Conclusion
Emphasize how addressing these constraints through investment and expansion will enhance food security and benefit farmers.