The Food Corporation of India (FCI) is set to raise ₹50,000 crore in short-term debt from scheduled banks for a three-month tenure, with a green shoe option to raise an additional ₹25,000 crore, according to a senior government official. Tenders for this facility will be opened on May 22, with total borrowings under the tender not exceeding ₹75,000 crore at any point of time. The short-term loans will be issued on an unsecured basis, and offers must remain valid until August 31, with loan disbursals made in tranches aligned with FCI's operational requirements.
Notably, the ₹6,000 crore government guarantee available for food credit to FCI will not be extended to these borrowings, as reported by the government official. The funds are being raised specifically to bridge cash flow mismatches arising from procurement and distribution of foodgrains. FCI, the government's nodal agency for procurement and distribution of foodgrains to ration card holders and beneficiaries under welfare schemes, is currently in the active wheat procurement season.
In the ongoing 2026-27 marketing season (March-April), FCI and state agencies have together procured 22.97 million tonnes of wheat directly from farmers at minimum support price, according to the latest data. Punjab leads procurement at 10.51 million tonnes, followed by Madhya Pradesh at 6.72 million tonnes, Haryana at 2.58 million tonnes, and Rajasthan at 1.77 million tonnes. The government has set a wheat procurement target of 34.49 million tonnes for 2026-27, indicating significant progress toward this goal.
The government's fertiliser subsidy bill for 2026-27 may surge by ₹70,000 crore to ₹2.41 trillion, driven by rising import costs of urea and other fertilisers amid the ongoing West Asia crisis, according to Additional Secretary Aparna S Sharma. The budgetary allocation for fertiliser subsidies in 2026-27 stands at ₹1.71 trillion, with the subsidy bill expected to increase significantly due to the geopolitical tensions. Despite cost pressures, fertiliser availability for the 2026 kharif season remains "comfortable," with stocks exceeding 51 per cent of the total requirement of 390 lakh tonne.
