The Union Cabinet has approved a one-time loan of 45 thousand crore rupees to Food Corporation of India to meet its food subsidy requirements. The loan will be provided from National Small Savings Fund (NSSF). Besides,the Cabinet also took decision to exempt States except Arunachal Pradesh, Delhi, Kerala and Madhya Pradesh from NSSF investments from April,2016. <br/><br/>The repayment obligation of the FCI in respect of NSSF Loans would be treated as the first charge on the food subsidy released to it. In addition, FCI will reduce the amount of its current Cash Credit Limit with the banking consortium to the extent of the NSSF loan amount. Once states are excluded from NSS investments, the investible funds of NSSF with Central Government will increase.<br/><br/>The Increased availability of the NSSF loan to the Centre may reduce its market borrowings. The States will however, see an increase in market borrowings.