The Food Corporation of India (FCI) is set to raise ₹50,000 crore through short-term borrowing from scheduled banks to support ongoing foodgrain operations. According to a senior government official, the loan is proposed for a three-month tenure, with a “green shoe” option that can be used to raise an additional ₹25,000 crore. The financing is intended to address cash flow mismatches that arise between the procurement and distribution of foodgrains.
The bidding process for the proposed borrowing is scheduled, with tenders to be opened on May 22. The terms discussed across reports state that total borrowings under the tender will not exceed ₹75,000 crore at any point in time. The short-term loans are described as unsecured. A government guarantee of ₹6,000 crore that is available for food credit to FCI is not expected to be extended to these specific borrowings.
Under the tender conditions, offers are required to remain valid until August 31, and disbursals are planned in tranches aligned with FCI’s operational needs. FCI is the government’s nodal agency for procuring and distributing foodgrains to ration card holders and other beneficiaries.
