Centre starving FCI of funds: CAG

The Comptroller and Auditor General on Friday said the Centre was starving the Food Corporation of India of funds forcing it to borrow from other sources at higher interest rates.
 
“The main reason for indebtedness of FCI was delayed/insufficient release of subsidy by the Ministry,” the CAG said in a report on the Food Corporation of India that was tabled in Parliament on Friday.
 
The outstanding subsidy payments to FCI have increased from Rs 15,668.87 crore in 2011-12 to Rs 58,649 crore in 2015-16, the report said.
 
“This was on account of the short release of subsidy by the Government of India in each of the years necessitating FCI to raise funds through interest-bearing loans, bonds,” it said adding that the external borrowings led to led to extra interest burden of Rs 35,701.81 crore on FCI.
 
Adding to the debt is the outstanding dues from various ministries with the Rural Development Ministry topping the list with payment of Rs 2452.96 crore pending since 2008-09. The FCI had supplied foodgrains for the Sampoorna Gramin Rozgar Yojana from 2000-01 to 2007-08.
 
The HRD Ministry comes next with Rs 326.35 crore pending since 2010-11 on account of non-settlement of bills for the mid-day meal scheme by various state governments.
 
The ministry of external affairs has to make a payment of Rs 48.32 crore for the export of wheat issued to the World Food Programme for the supply of biscuits to Afghanistan from 2004 to 2012. Public sector enterprises owe another Rs 69.54 crore to the FCI.
 
The total outstanding of Rs 2897.17 crore has incurred an interest of Rs 1617.48 crore for the period 2011-12 to 2015-16 with an increase in the subsidy burden by an equivalent amount.
 
The CAG has asked the Finance Ministry to make the full allocation on time towards the food subsidy component given to the FCI.