PUBLIC DISTRIBUTION SYSTEM

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Nobel Laureate Professor Amartya Sen praised India’s Public Distribution System (PDS). He said that markets couldn’t address issues of poverty and starvation on their own, that government programs must resolve these issues. India has built the largest, though not necessarily the strongest, PDS in the world. This is a commendable step for development in India.

The Public distribution system (PDS) is an Indian food Security System established under the Ministry of Consumer Affairs, Food, and Public Distribution.

India’s Public Distribution System (PDS) is the largest distribution network of its kind in the world. PDS was introduced around World War II as a war-time rationing measure.

Evolution of PDS

Before the 1960s, distribution through PDS was generally dependent on imports of food grains. It was expanded in the 1960s as a response to the food shortages of the time; subsequently, the government set up the Agriculture Prices Commission and the Food Corporation of India to improve domestic procurement and storage of food grains for PDS.

By the 1970s, PDS had evolved into a universal scheme for the distribution of subsidised food. In the 1990s, the scheme was revamped to improve access of food grains to people in hilly and inaccessible areas, and to target the poor.

Subsequently, in 1997, the government launched the Targeted Public Distribution System (TPDS), with a focus on the poor.

In September 2013, Parliament enacted the National Food Security Act, 2013. The Act relies largely on the existing TPDS to deliver food grains as legal entitlements to poor households. This marks a shift by making the right to food a justiciable right.

Objectives of Public distribution system:

  • Make goods available to consumers, especially the disadvantaged /vulnerable sections of society at fair prices.
  • Rectify the existing imbalances between the supply and demand for consumer goods. Check and prevent hoarding and black marketing in essential commodities.
  • Ensure social justice in distribution of basic necessities of life.
  • Even out fluctuations in prices and availability of mass consumption goods.
  • Support poverty-alleviation programmes, particularly, rural employment programmes, (SGRY/SGSY/IRDP/ Mid-day meals, ICDS, DWCRA, SHGs and Food for Work and educational feeding programmes.

Timeline of PDS

Targeted Public Distribution System (TPDS),

It aims to provide subsidised food and fuel to the poor through a network of ration shops. Food grains such as rice and wheat that are provided under TPDS are procured from farmers, allocated to states and delivered to the ration shop where the beneficiary buys his entitlement. The centre and states share the responsibilities of identifying the poor, procuring grains and delivering food grains to beneficiaries.

How TPDS operates

  • The existing TPDS operates through a multi-level process in which the centre and states share responsibilities.
  • The centre is responsible for procuring or buying food grains, such as wheat and rice, from farmers at a minimum support price.
  • It also allocates the grains to each state on the basis of a formula. Within the total number of poor in each state, state governments are responsible for identifying eligible households.
  • The centre transports the grains to the central depots in each state. After that, each state government is responsible for delivering the allocated food grains from these depots to each ration shop.
  • The ration shop is the end point at which beneficiaries buy their food grains entitlement.

 

Identification of eligible households under existing TPDS

The government launched TPDS in order to target food grains entitlements to poor households. Therefore, identification and classification of beneficiaries is crucial to fulfil the goals of the scheme. Categorisation of beneficiaries APL and BPL Under TPDS, beneficiaries were divided into two categories:

  1. Households below the poverty line or BPL; and
  2. Households above the poverty line or APL.

BPL beneficiaries that are currently covered under TPDS were identified through a detailed process when TPDS was initially launched.

Each state government was responsible for identifying eligible BPL households on the basis of inclusion and exclusion criteria evolved by the Ministry of Rural Development. Such households were entitled to receive a BPL ration card.

APL households were not identified and any household above the poverty line could typically apply for an APL ration card.

Process of identification of  BPL families

 

The National Food Security Act, 2013

The National Food Security Act, 2013 (also Right to Food Act) is an Act of the Parliament of India which aims to provide subsidized food grains to approximately two thirds of India’s 1.2 billion people. It was signed into law on 12 September 2013, retroactive to 5 July 2013.

The National Food Security Act, 2013 (NFSA 2013) converts into legal entitlements for existing food security programmes of the Government of India.

It includes the Midday Meal Scheme, Integrated Child Development Services scheme and the Public Distribution System.

Further, the NFSA 2013 recognizes maternity entitlements. The Midday Meal Scheme and the Integrated Child Development Services Scheme are universal in nature whereas the PDS will reach about two-thirds of the population (75% in rural areas and 50% in urban areas).

Under the provisions of the bill, beneficiaries of the Public Distribution System (or, PDS) are entitled to 5 kilograms (11 lb) per person per month of cereals at the following prices:

  • Rice at Rs. 3 per kg
  • Wheat at Rs.2 per kg
  • Coarse grains (millet) at Rs 1 per kg.

Pregnant women, lactating mothers, and certain categories of children are eligible for daily free cereals.

Importance of Public Distribution System :-

  • Public distribution system has helped in stabilizing prices of the food grain and making food available to poor people at affordable prices.
  • Helped to ensure that the poor section of society also have the access to the food.
  • It maintains the buffer stock of food grains in the warehouse so that the flow of food remain active even during the period of less agricultural food production.
  • The Public Distribution System also keeps an eye on the hoarders and black marketers who try for windfall gain at the cost of poor people and other consumers.
  • It helps in ensuring Food and Nutritional Security of the nation.
  • It has helped in stabilising food prices and making food available to the poor at affordable prices.
  • It has helped in redistribution of grains by supplying food from surplus regions of the country to deficient regions.
  • The system of minimum support price and procurement has contributed to the increase in food grain production.

Problems associated with PDS

The public distribution system of India is not without its defects. With a coverage of around 40 million below-poverty-line families, a review discovered the following structural shortcomings and disturbances:

  • Growing instances of the consumers receiving inferior quality food grains in ration shops.
  • Rogue dealers swap good supplies received from the Food Corporation of India (FCI) with inferior stock and sell the good quality FCI stock to private shopkeepers.
  • Illicit fair price shop owners have been found to create large number of bogus cards to sell food grains in the open market.
  • Many FPS dealers resort to malpractice, illegal diversions of commodities, holding and black marketing due to the minimum salary received by them.
  • Numerous malpractices make safe and nutritious food inaccessible and un-affordable to many poor thus resulting in their food insecurity.
  • Identification of households to be denoted status and distribution to granted PDS services has been highly irregular and diverse in various states. The recent development of Aadhar UIDAI cards has taken up the challenge of solving the problem of identification and distribution of PDs services along with Direct Cash Transfers.
  • Regional allocation and coverage of FPS are unsatisfactory and the core objective of price stabilization of essential commodities has not met.
  • There is no set criteria as to which families are above or below the poverty line. This ambiguity gives massive scope for corruption and fallouts in PDS systems because some who are meant to benefit are not able to.
  • (Transportation leakages + Black Marketing by FPS owners) TPDS suffers from large leakages of food grains during transportation to and from ration shops into the open market. In an evaluation of TPDS, the erstwhile Planning Commission found 36% leakage of PDS rice and wheat at the all-India level.
  • The over-emphasis on attaining self-sufficiency and a surplus in food grains, which are water-intensive, has been found to be environmentally unsustainable. Procuring states such as Punjab and Haryana are under environmental stress, including rapid groundwater depletion, deteriorating soil and water conditions from overuse of fertilisers.

Mechanisms to strengthen TPDS

Role of Aadhaar

One of the key problems in the implementation of TPDS is the inclusion and exclusion errors in the identification of beneficiaries. Proposals have been made to integrate the Unique Identification or Aadhaar number with several government schemes, including TPDS to address this problem.

The Aadhaar number would be used to accurately identify and authenticate beneficiaries entitled to receive subsidies under TPDS and other government schemes. According to a study by the Unique Identification Authority of India, using Aadhaar with TPDS would help eliminate duplicate and ghost (fake) beneficiaries, and make identification of beneficiaries more accurate.

Technology-based reforms of TPDS implemented by states

To improve the current system of the PDS, the following suggestions are furnished for:

  • Vigilance squad should be strengthened to detect corruption, which is an added expenditure for taxpayers.
  • Personnel-in-charge of the department should be chosen locally.
  • Margin of profit should be increased for honest business, in which case the market system is more apt anyway.
  • C.I. and other prominent agencies should provide quality food grains for distribution, which is a tall order for an agency that has no real incentive to do so.
  • Frequent checks and raids should be conducted to eliminate bogus and duplicate cards, which is again an added expenditure and not foolproof.
  • The Civil Supplies Corporation should open more fair price shops in rural areas.
  • The fair price dealers seldom display rate chart and quantity available in the block-boards in front of the shop. This should be enforced.

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