DFPD and FCI Sign MoU to Boost Efficiency and Accountability in Food Grain Procurement and Distribution

By enhancing FCI's operational performance and its depots, the MoU aims to achieve significant improvements in the effectiveness of the PDS.

Today, the Department of Food and Public Distribution (DFPD) and the Food Corporation of India (FCI) have formalized a Memorandum of Understanding (MoU) for the fiscal year 2024-25, aimed at enhancing the efficiency and accountability of food grain procurement and distribution.

The MoU introduces specific performance benchmarks, including the performance benchmarking of FCI depots. These benchmarks focus on key parameters such as capacity utilization, operational losses, security measures, and the modernization and automation of depot processes. This initiative is designed to optimize the use of public funds and improve the management of food security operations.

This agreement underscores the central government's commitment to refining the Public Distribution System (PDS) and ensuring that food subsidy funds are utilized with the utmost efficiency. By enhancing FCI's operational performance and its depots, the MoU aims to achieve significant improvements in the effectiveness of the PDS.

Established in 1965 under the Food Corporations Act, 1964 (Act No. 37 of 1964), FCI is tasked with the purchase, storage, transport, distribution, and sale of food grains. Operating under a public service mandate financed entirely by food subsidies from the Government of India, FCI plays a crucial role in the nation's food security.

Given the substantial public expenditure involved, it is essential to evaluate the cost-effectiveness and value for money of these operations. This involves benchmarking performance on critical operational parameters and establishing robust institutional accountability. The MoU marks a significant step towards achieving these goals.