Parliament Question: Implementation of Reforms in FCI

GOVERNMENT OF INDIA MINISTRY OF CONSUMER AFFAIRS, FOOD & PUBLIC DISTRIBUTION DEPARTMENT OF FOOD AND PUBLIC DISTRIBUTION LOK SABHA UNSTARRED QUESTION NO. 465 TO BE ANSWERED ON 23RD JULY, 2025 IMPLEMENTATION OF REFORMS IN FCI 465. SHRI RAMASAHAYAM RAGHURAM REDDY: Will the Minister of CONSUMER AFFAIRS, FOOD AND PUBLIC DISTRIBUTION be pleased to state: (a) whether the Government has plans to implement reforms as suggested by the Shanta Kumar Committee to restructure Food Corporation of India to improve its financial management and operational efficiency in procurement, storage and distribution of foodgrains; (b) if so, the details thereof; (c) if not, the reasons therefor; and (d) the details of other such measures being taken by the Government to ensure that the functioning ofFCI is streamlined and fast-paced ANSWER MINISTER OF STATE FOR MINISTRY OF CONSUMER AFFAIRS, FOOD & PUBLIC DISTRIBUTION (SHRIMATI NIMUBEN JAYANTIBHAI BAMBHANIYA) (a) to (b):Yes sir. A High Level Committee (HLC) on restructuring of Food Corporation of India (FCI), chaired by Shri Shanta Kumar, conducted a comprehensive review of the administrative, functional and financial structure ofFCI and submitted its report. The action taken on its recommendations related to improving FCI’s financial management and operational efficiency in procurement, storage and distribution of food grains are at Annexure-A. (c) N/A. (d) The details are enclosed at Annexure-A. ####(Annexure-A) ANNEXURE. REFEIUtED TO, IN REPLY TO PART (d) OF THE UNST'ARRED QUESTION NO.465 FOR ANSWER ON 22.07.2025 Recommendations of High Level Committee, decisions taken by Government of India and Action Taken by FCI thereon e Action Taken 1. iiLC' recommends that FCI hand over all procurement operations of wheat, F CI has . already handed over- procurement operations fully to State Government in Andhra Pradesh, paddy and ’rice to states tilat '.h£rre !. T61angana, Kerala, Tamil Nadu, Cbhattisgarh, Madhya Pradesh, Mdlaras Il_tra, Gujarat, Himachal Pradg-sh, I gained sufficient 'experience in' this I'Uttarakhand, Bihar, Jhark_hand, West Bengal, Odisha and i-rip lira. Recently, Assam has adopted DCP mode of regard and have created reasonable Procurement 'for.Rice in two' districts namely Borlgaigacn and B ishwanath Districts from KMS 2023.-24. FC 1 i i I inttastnlcture for procurelnelt. These {' is puTticipating in .procurement operations . in Punjab and Haryana on the request of concerned State I { States are , Andhra Pradesh, Governments -Chhattisgarh, Haryana, Madhya I Pradesh, Odisha and Punjab. FCI procured around 0.2% of paddy and around 7% of wheat during KMS 2023-24 and RMS 2025-26, respectively, out of total -procurement done for Central Pool. Remaining procurement is done by State Government and its Agencies. I'he details of DCP States for procurement of wheat and rice are as under:DCP States for Rice & Wheat SI. RICE WHEAT No. 1 Andhra Pradesh Bihar 2 Bihar Chhattisgarh 3 Chhattisgarh Gujarat 4 Gujarat Madhya Pradesh 5 Karnataka Maharashtra 6 Kerala Punjab 7 Madhya Pradesh Uttarakhand 8 Maharashtra West Bengal 9 Odisha Himachal Pradesh 10 Tamil Nadu 11 Telangana 12 Tripura 13 tJttarakhand 14 West Bengal 15 Himachal Pradesh 16 Jharkhand 17 Assam (Only in two districts i.e. Bongaigaon and Bishwanath) 2. FCI will accept only the surplus(after For decentralized procurement ( DCP) states only surplus foodgrains are accepted by FCI. deducting the needs of the states under NFS A) from these state governments ( Non- millers) to be moved to deficit statesFCl' should move on to help those Continuous efforts and hand holding to the State Govt. agencies have been extended in the Eastern and North- states whcre farmers suffer from Eastern States to increase the penetration of MSP operation. In KMS 2021-22, 107.31 LMT paddy (in terms distress sales at prices much below- of rice) was procured in Eastern/ North - Eastern States as against 105.77 LMT paddy (in terms of rice) MSP, and which are dominated by procured during KMS 2020-21 . In KMS 2022-23 and KMS 2023-24 a quantity of 99.36 LMT and 76.83 LMT small holdings, like Eastern Uttar paddy (in terms of rice) respectively has been procured in Eastern States. During KMS 2024-25, 90.36 LMT Pradesh, Bihar, West Bengal, Assam Paddy (in terms of rice) has been procured in Eastern States up to 15.07.2025. etc Emphasis has also been given on procurement of wheat in Eastern States such as UP & Bihar. Procurement of wheat in Bihar and UP has increased during RMS 2025-26 in comparison to last two marketing seasons due to early and vigorous efforts from DFPD, FCI as well as State Govts. 4. Quality checks .in .procurement ha-'’e to } !. 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Depot Online System (DOS): Depot Online system with the goal of computerization/automation of procurement, storage and movement operation was launched on 01.12.2018 and currently operative in all own FCI depots as well as hired depots. 2. WINGS: To automate the tagging of rice mills with depots, as well as allocation of stack space in the depots, FCI has developed the Warehouse Inventory Network & Governing System (WINGS). Automated linkage plans generated by the system promote heightened transparency among millers. This automated system empowers the millers to book stack spaces in depots and ensures efficient utilization of depot spaces. This system is now fully operational in all rice procuring region from KMS 2023-24. 3. The Central Foodgrains Storage Portal (CFSP), launched in 2022 by the NIC and FCI, aims to create a unified national platform for managing decentralized procurement (DCP) stocks. The CFSP enhances efficiency, transparency, and reliability in foodgrain storage, supporting better decision making and stronger management of national food reserves.than 3 months. Silo bag technology and conventional storages where ever possible should replace CAP. 9 HLC observed huge disparity in wages Ministry of Labour and Employment vide notification dated 06.07.2016 exempted all 226 • depots/railheads from the applicability of Section 10 of Contract Labour (R&A) Act 1970 for a period of of various kind of labour force engaged 2 years and since then they have been granting extension of exemption. by FCI. This happens because of the incentive system in notified depots, Nodal Officers have been appointed at field level for improving the working condition of contract • and widely used proxy labour. This labour and to ensure better facilities and adequate welfare provisions like EPF, Minimum wages, ESI, Workmen Compensation etc and facilities like canteen/restroom, urinals, drinking water facilities. must be fixed, either by de-notifying these depots, or handing them over to The Departmental Labour cadre has been declared a 'Dying Cadre’ by the Ministry of Consumer states or prrvate sector on service • Affairs, Food & Public Distribution, in accordance with the judgment dated 20.11.2015 by the Hon’ble contracts, and by fixing a maximum High Court of Bombay, Nagpur Bench, in PIL No. 84/2014. limit on the incentives per person that will not allow him to work for more • The Voluntary retirement scheme for DLS workers has been introduced with the approval of the Ministry of CA, F&PD for initially 90 days. Subsequently, on request of field offices/ labour unions than say 1.25 times the work agreed was extended till 20.01.2025. As on 20.01.2025, a total of 1,212 Departmental Labourers opted for with him. VRS These depots should be put on priority for mechanization so that reliance on departmental labour reduces. If need be, FCI should be allowed to hire people under DPS/ NWNP system. HLC recommends that the condition of contract labour, which works thehardest and are the largest in number, should be improved by giving them better facilities. 10. HLC recommends total end to end The Anna Darpan Project is a direct implementation of the vision set forth by the Shanta Kumar Committee. computerization of the entire food management system, starting from The Anna Darpan Project ofFCI, which is currently under development, aligns with the vision of the Shanta procurement from farmers, to stocking, Kumar Committee (2015), which strongly recommended the end-to-end digitisation of the entire supply chain movement and finally distribution management system–from the procurement of foodgrains to their storage, movement, and final issuance to through TPDS. It can be done on real beneficiaries through designated agencies. The project is being developed as a centralized, integrated digital time basis, and some states have done a platform covering key functional areas such as procurement, storage, movement, sales, contract and inventory commendable job on computerizing management, quality control and labour. Once implemented, it will enable real-time monitoring, integration the procurement operations. But its with state procurement portals and enhance transparency and accountability through digital workflows and dovetailing with movement and audit trails. Thus, Ama Darpan represents a major step toward modernizing FCI’s operations in line with the distribution in TPDS has been a weak committee’s recommendations link, and that is where much of the diversions take place.4. Central Food Grains Procurement Portal (CFPP): Department of Food & Public Distribution (DFPD), GoI has envisioned an application ecosystem, wherein the MSP procurement done by government agencies is available at a single source by integrating all State procurement portals, with common parameters, for monitoring and strategic decision making. The digitization of the entire procurement operations has been put in place with effect from Kharif Marketing Season (KMS) 2021 22 5. Vehicle Location Tracking System (VLTS) : Food Corporation of India (FCI) under the supervision of Department of Food & Public Distribution is working to have a robust monitoring mechanism for transportation of food grains using Road Transport Contractors (RTCs) from dispatching depot till receiving depot. In this regard, GPS enabled live tracking solution viz. Vehicle Location Tracking System (VLTS) has been developed to, enable e-surveillance of food grains in-transit (Rail as well as Road) and also curb the possibilities of pilferage of foodgrains enroute. State/UT Governments are also in the process of implementing Vehicle Location Tracking System (VLTS) for live tracking of end to end movement of.foodgrains in the public distribution system. As on 04.07.2025 total 3(Pf transporters have been onboarded and total completed trips are 105301. +:$e$eRlc+: