Finance Ministry Releases ₹70,000 Crore in Food Subsidy to FCI

The Finance Ministry has released over Rs 70,000 crore, which is approximately 45% of the budgeted food subsidy for 2026-27, to the Food Corporation of India (FCI). This upfront release of funds has helped keep FCI's costs in check. The allocation of food subsidy to FCI is largely used for supplying free rice and wheat under Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) and maintaining a buffer stock.

FCI currently holds 87.38 million tonnes of grains, including 39.6 MT of rice and 47.7 MT of wheat. The corporation supplies around 36-38 MT of rice and 18-20 MT of wheat under the free ration scheme every year, leading to a piling up of stocks.

The FCI's economic cost for rice and wheat is estimated to increase to Rs 43.91/kg and Rs 31.45/kg in 2026-27 due to rising minimum support price (MSP), carrying costs, storage, and other expenses. This could result in an actual outgo of over Rs 2.47 lakh crore, exceeding the budget estimate of Rs 2.27 lakh crore.