disadvantages of Food Corporation of India
Answers
In the euphoria surrounding the enactment of the National Food Security Act (NFSA) in 2013, its champions forgot to pay attention to a key ingredient for making it successful: the state of the food supply chain in India. As in much else, the existing setup was sufficient. From the procurement system run by the Food Corporation of India (FCI) to the fair price shops distributing foodgrains, the system was expected to run smoothly. Shortcomings such as leakages from the Public Distribution System (PDS) and the high cost of buying wheat and rice from farmers and distributing them were ignored in the ideological drumming up of support for the NFSA.
Some of these flaws that are sufficiently severe to call into doubt the effective running of NFSA have now been laid threadbare by the report of the High Level Committee (HLC) to recommend the restructuring of the Food Corporation of India (FCI), the government agency that manages the country-wide system of foodgrain purchase and distribution.
Some of FCI’s problems are obvious. Its ability to carry out operations cost effectively is doubtful. In the span of three years—from 2010-11 to 2013-14, the last year for which data is available—the freight cost incurred by it doubled from ₹ 3,245 crore to ₹ 6,640 crore. Worse, the organization now spends a very considerable amount of money on payment of interest. In the same three years, its interest payments tripled from ₹ 1,560 crore to ₹ 4,708 crore. These two costs alone account for more than half of its expenditure on distributing foodgrains across India.
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The food corporation of India is one of organization of government of India. It is one of organization for distribution, security and storage of food.
Explanation:
The food corporation of India was established in 1964. The FCI buy the rice and wheat from the farmers of India where there is surplus production and store it for the situation of emergency.
The following are the disadvantages of FCI:
1. This organization buys the wheat and rice at high cost.
2. This is associated with black marketing, hoarding and ill-legal marketing.
3. This organization neglects the rotting of the grains.
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