Presentation by Sonal Chadha, Harleen Kaur, Sachin Rajpal,
Aanchal Jindal and Jagandeep Singh from Sri Guru Gobind
Singh C...
FOOD SECURITY
 Around 35% of India’s population—320 million
people are considered food insecure, consuming
less than 80% ...
WHAT IS PUBLIC DISTRIBUTION SYSTEM (PDS)?
 The PDS is a form of system of rationing that was
started during the era of fo...
TARGETED PUBLIC DISTRIBUTION SYSTEM
(TPDS)
 Scheme in existence since 1965 – earlier universal coverage.
 In 1997, TPDS ...
 In order to make TPDS more focused and targeted towards the poor, the “ANTYODAYA ANNA
YOJANA" (AAY) was launched in Dece...
LEAKAGES TO PDS
• PDS has benefited only a small section of population i.e., the urban poor.
It has not much presence in t...
“For every Rs 4 spent
on the PDS, only Rs 1
reaches the poor”
57% of the PDS food
grain does not reach the
intended people...
MEASURES TO IMPROVE EFFICIENCY AND
REACH OF PDS
Citizen’s Charter
A revised Citizens’ Charter has been issued in July, 200...
Computerisation
Central Government has taken the initiative for end-to-end computerization of PDS
across the country in a ...
Grievance Redressal Mechanism
Personnel Engaged
Department of Food & Public Distribution, Government of India is implement...
Restructuring the PDS
a) Items other than rice and wheat need to be excluded from the
purview of TPDS.Sugar should be kept...
Appendix
 www.planningcommission.nic.in
 www.dfpd.nic.in
 www.cacp.nic.in
 www.fciweb.nic.in
 www.Inbministry.blogspo...
THANK YOU
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  1. 1. Presentation by Sonal Chadha, Harleen Kaur, Sachin Rajpal, Aanchal Jindal and Jagandeep Singh from Sri Guru Gobind Singh College Of Commerce, Delhi University.
  2. 2. FOOD SECURITY  Around 35% of India’s population—320 million people are considered food insecure, consuming less than 80% of minimum food requirements.  Taking into consideration the problem of poverty and hunger, the Ninth Five Year Plan states that, “Ensuring food and nutritional security for all, particularly the vulnerable sections of society” will be its main objective.  According to the Food and Agriculture Organisation (FAO), Food security pertains to, “Ensuring that all people at all times have both physical and economic access to basic food they need.”  Components of Food Security are:  Increase in food production  Providing Assured Minimum Prices to the Farmers  Procurement of Food grains  Public Distribution System  Maintaining Buffer Stock  National Food Security Act (NFSA) FOOD SECURITY Adequate supply Efficient distribution system Economic access Nutritious
  3. 3. WHAT IS PUBLIC DISTRIBUTION SYSTEM (PDS)?  The PDS is a form of system of rationing that was started during the era of food shortages in 1960’s.  For building up a strong and reliable food security system, it is not only enough to produce and supply adequate quantity of food in the market, but also to ensure that this food reaches the people and is actually available to them for meeting their consumption requirements. It is an instrument for ensuring availability of certain essential commodities at easily affordable prices especially for the poor.  On an average, about 15-16 million tonnes of foodgrains are issued by the FCI to the States at a uniform Central Issue Price (CIP) which is much less than the economic cost incurred by the Central Government by way of procurement, storage, transport and distribution.  The difference between the economic cost and the CIP, called the consumer subsidy, is borne by the Central Government through its annual non-Plan budget. • Under this system, the ration card holders were given a certain minimum prescribed amount of foodgrains (based on the number of family members, every household was allotted certain number of units of food) at highly subsidised prices. •The Ration shops were later known as FAIR PRICE SHOPS to supply some minimum amount of foodgrains, sugar and some other essential items to the people at subsidised prices. (more than 5 lakh in number). •This system of sale of essential goods such as foodgrains, sugar, kerosene, etc by the Government at subsidised prices, through a network of fair price shops, is called Public Distribution System. “Of all the net safety operations that exist in India,the most far reaching,in terms of coverage as well as public expenditure on subsidy,is the Public Distribution System(PDS)”
  4. 4. TARGETED PUBLIC DISTRIBUTION SYSTEM (TPDS)  Scheme in existence since 1965 – earlier universal coverage.  In 1997, TPDS was introduced with greater emphasis on BPL people.  Under TPDS, foodgrains are currently allocated to 6.52 crore BPL families (1993-94 poverty estimates projected to March 2000 population). This includes 2.43 crore AAY families (poorest of the poor).  35 Kg foodgrains per family are provided to BPL/ AAY families. For APL families, Government provides 15-35 Kg depending upon availability of foodgrains in the Central pool. Prices are Rs.2/3 per Kg for wheat/ rice for AAY, Rs.4.15/ 5.65 per Kg for BPL and Rs.6.10/ 8.30 per Kg for APL families.  The Revamped Public Distribution System (RPDS) was launched in June, 1992 with a view to strengthen and streamline the PDS as well as to improve its reach in the far-flung, hilly, remote and inaccessible areas where a substantial section of the poor live. Under TPDS, a two-tier subsidised pricing system was introduced for special benefit of the poor. The essential feature of TPDS is that the poor people, i.e., below the poverty line(BPL) families are provided foodgrains at a specially subsidised rates which are almost half of the price that is charged from those people who are above the poverty line (APL). Thus, the Fair Price Shops (FPS) have two sets of prices, one for the people below poverty line and the other one for those who are above the poverty line.
  5. 5.  In order to make TPDS more focused and targeted towards the poor, the “ANTYODAYA ANNA YOJANA" (AAY) was launched in December, 2000 for one crore poorest of the poor families. AAY contemplates identification of one crore poorest of the poor families from amongst the BPL families covered under TPDS within the States and providing them foodgrains at a highly subsidized rate of Rs.2/ per kg. for wheat and Rs. 3/ per kg for rice. The States are required to bear the distribution cost, including margin to dealers and retailers as well as the transportation cost.  Unique quota cards to be recognized an "Antyodaya Ration Card" must be given to the Antyodaya families by the chosen power. These ration card must be having the required details regarding the Antyodaya family, level of ration etc.  Also, to overcome the problem of Poverty and Hunger, NATIONAL FOOD SECURITY BILL was introduced in India and also has been passed by both the houses of Parliament.
  6. 6. LEAKAGES TO PDS • PDS has benefited only a small section of population i.e., the urban poor. It has not much presence in the rural areas where a vast majority of the poor people live. Urban bias • PDS involves a huge subsidy, which amounts to more than Rs 27 thousand crores.Huge Subsidy • Due to frequent upward revisions of procurement prices and MSP, this cost of foodgrains purchases has been going up, which has resulted in high issue prices. High Issue Prices • Inefficient operations by FCI, high cost of transportation, storage, etc., all adds upto high cost of foodgrains. High Cost • Benefits of the PDS are not uniformly spread over all regions. Some states gain more from it than others. Uneven benefits • Leakages from the PDS in the form of diversion of PDS supplies to the market by FPS owners limit the benefits from reaching the poor.Corrupt Officials
  7. 7. “For every Rs 4 spent on the PDS, only Rs 1 reaches the poor” 57% of the PDS food grain does not reach the intended people ” Imagine a water supply system which is supposed to deliver water in a tap for a particular household. For every 100 litres of water supplied, the targeted household however receives only 10 litres of water. 19 litres is taken by the neighbour who is not supposed to use water from this tap, but claims to be dependent on this tap. Another 43 litres is stolen from the pipeline illegally, while the supplier uses 28 litres of water to just run the pipeline. This is the story of India’s Public Distribution System [PDS] as brought out by an Asian Development Bank Working Paper, How Can Food Subsidies Work Better? 0 1000 2000 3000 2009-102010-112011-12 Till July 2012 Millions of tonnes of foodgrains going waste every season said to offer huge opportunities for supply chain companies to enter the business,though it is getting increasingly politicalised of late (in metric tonne)
  8. 8. MEASURES TO IMPROVE EFFICIENCY AND REACH OF PDS Citizen’s Charter A revised Citizens’ Charter has been issued in July, 2007 for adoption and implementation by the State/UT Governments for facilitating its use by citizens as per provisions of Right to Information Act , 2005, in relation to functioning of the TPDS. PDS (Control) Order, 2001 In order to maintain supplies and securing availability and distribution of essential commodities, PDS (Control) Order, 2001 has been notified on August 31, 2001. The Order mainly contains provisions with regard to the issues such as Identification of families below the poverty line; Ration cards; Scale and issue price; Distribution of foodgrains; Licensing and Monitoring. Meetings /Conferences A meeting of all State and UT Food Secretaries was held under the Chairmanship of Union Food Secretary at Hyderabad on 8.2.2008 to discuss the measures for reforming PDS. The minutes of said meeting were sent to all concerned for taking necessary action thereon.
  9. 9. Computerisation Central Government has taken the initiative for end-to-end computerization of PDS across the country in a time bound manner. For this purpose, a Scheme is being formulated to cover all States / UTs and end-to-end computerisation of TPDS will be undertaken upto the last mile. Door step Delivery of Foodgrains The state Department of Food and Civil Supplies has started the "doorstep delivery" facility for foodgrain under the PDS. According to Commissioner of Food and Civil Supplies, Rajeev Agarwal, the department will send the foodgrain straight to the PDS shopowner through its own trucks — instead of the shop owner managing the transportation. Aadhaar Using Aadhaar solely for identification would enable clear targeting of PDS beneficiaries, the inclusion of marginal groups, and expanded coverage of the poor through the elimination of fakes and duplicates. Implementing Aadhaar-based authentication across PDS would enable the government to guarantee food delivery to the poor.
  10. 10. Grievance Redressal Mechanism Personnel Engaged Department of Food & Public Distribution, Government of India is implementing scheme called TPDS- Training. This scheme aims at strengthening and upgrading the skills of personnel engaged in the functioning and implementation of TPDS by conducting training programmes and organizing lectures, seminars and workshops on policy issues with regard to TPDS . Central Government provides financial assistance to the State/UT Governments for conducting training programmes Smart Card There is no foolproof authentication of the beneficiary under PDS, but under RSBY, an elaborate Key Management System (KMS) ensures that the smart card cannot be issued to a wrong person. At the point of service as well, RSBY facilitates a foolproof identification through biometric system as the thumb impressions of the beneficiaries can be matched with that in the smart card. As and when complaints are received in the Department from individuals and organizations as well as through press reports, they are sent to State/UT Governments concerned for inquiry and appropriate action. In case of any grievance relating to the above- referred aspects, the Food & Civil Supplies authorities of the State/UT concerned may be approached..
  11. 11. Restructuring the PDS a) Items other than rice and wheat need to be excluded from the purview of TPDS.Sugar should be kept outside the purview of PDS. b) There is huge leakage of kerosene meant for PDS. The subsidy on kerosene should be phased out by raising its supply price.Alternately, if kerosene is to be retained under PDS, the extent of subsidy given should be reduced so that there is less incentive for diversion. c)The coverage of TPDS and food subsidy should be restricted to the BPL population. d)With the liberalisation of external sector, the operation of the buffer stock can be supplemented by timely exports and imports . e) Jean Dreze suggests the introduction of a ‘quasi-universal system’ based on specific inclusion criteria; as well as a system of food coupons which possess a unique identification number and hologram. as As we see that PDS is playing very important role in our economy and it is providing very essential and important items to BPL households but PDS has many leakages and weakness which are creating obstacles in the efficiency of PDS. Like that we can say that with the implementation of some measures the PDS can give fruitful results to poor people.
  12. 12. Appendix  www.planningcommission.nic.in  www.dfpd.nic.in  www.cacp.nic.in  www.fciweb.nic.in  www.Inbministry.blogspot.in  Economic Survey  Union Budget  www.nytimes.com
  13. 13. THANK YOU

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