The document proposes reforms to improve India's Public Distribution System (PDS) by reducing leaks and increasing transparency. It analyzes problems at each stage of the PDS process from procurement to distribution. A new system is proposed using a centralized database, electronic ID cards, packaged food grains, community inspectors, and informers. This system aims to increase transparency, accountability, and access while reducing diversion and leaks estimated to cost over $3 billion annually. Initial costs are estimated but the system is intended to save substantial funds by plugging PDS leaks.

1. “PLUGGING THE LEAKS”
A thought initiative felt and prepared for bringing out reforms in present
PDS( Public Distribution System) via MANTHAN 2013 by the team:
OJAS
ANUJ MANTRI
UMESH PATEL
AYUSH MISHRA
VISHAL KUMAR PRASAD
MOHAMMED PARVEZ KHAN
“ We care for
IMPROVEMENT and
firmly believe in
INNOVATIONS….”

2. INTRODUCTION
PDS was basically inspired from the British system of rationing system during the world war II
which was then established and stabilized as a venture of FCI which was setup in 1965, with the following primary objectives as
:
Providing food grains and other essential items to vulnerable
sections of society at reasonable ( subsidized ) prices.
To have a moderating influence on the open market
prices of cereals, the distribution of which constitutes a
fairly big share of total marketable surplus.
To attempt socialization in the matter of distribution of
essential commodities.
PDS corruption estimate closely matches the lower bound estimate of 2G corruption.
But 2G scam happens once in a decade. “The PDS corruption happens every year”
UNIT 2004-
2005
2009-
2010
Distribution
via FPS
MIN TONS 41.2 48.9
Food
received by
the
population
MIN TONS 13.2 25.3
% leakage
by PDS
shops
68.2% 48.3%
Food
subsidy-
Ministry of
finance
RS.CRORES 24479 59621
Subsidy acc.
To NSS
RS.CRORES 8474 38875
PDS
corruption
estimate
RS.CRORES 16005 20746

3. STAGES PROBLEMS
1. FARMERS • Unavailability of raw materials
• Lack of resources
2. PROCUREMENT • Lack of access
• Depressed producers
3. GODOWNS • Obsolete Infrastructure
• Poor maintenance
4. TRANSPORTATION • Leakages
• Supply delays
• Higher cost
5. STATE STOCK HOUSES • Obsolete Infrastructure
• Poor maintenance
• Extortion and less no. of houses
6. FPS • Diversion
• Under weight
• Unfair business
7. CONSUMERS • Unavailability, unaffordability, non
accessibility
• Lack of information
• Exclusion error & Inclusion error
* The current storage capacity is 62.8
million tons, which is proving inadequate
as India had record rice and wheat stocks
of 65.6 million tonnes in its godowns in
early June. Officials say the problem will
only get increased as per present
execution status.

4. SALIENT FEATURES
 CDBMS – Central Database Management
System
 CDBMS will manage and enhance the
accessibility and authenticity of consumers to
PDS
 States shall ensure food security of its people
and maintain a real-time accountability to the
central control system.
 Consumers can have their eyes. Ears and
voice to all steps and stages of the PDS in this
set of discipline.
 Inspectors at each level to check leakages
and unfair business.
 Informers at consumer level to improve
transparency and access
CONSUMER
CDMS
SYSTEM
DE STATE
FPS FPS FPS
1. SUVIDHA CARD
2. PACKET SYSTEM
3. COMMUNITY INSPECTORS
4. INFORMER

5.  ( ACTIONS - STEPWISE, STAGEWISE )
THE INSIGHT TO THE INTITATIVE
STAGES OF PDS
PROCUREMENT
CENTRAL-
STATE
STATE-
CONSUMER
PROCUREMENT:
• Encourage small farmers, and their productivity skills.
• SMS alerts- Nowadays person from almost every
section of the society posses a mobile, so govt can
send imp alerts like MSPs, their transaction records.
• Access to the producers and register them so that they
can be benefitted by the system and may be able to
benefit the system.

6. • FCI godowns
• TRANSPORTATION
• State Stock houses
Elements
of
CENTRAL
-STATE
Stage
CENTRE-STATE
STAGE
• Appoint engineers and specialists to
come up with very strictly disciplined
system of stock houses comprising
primarily of modern infrastructure
and accessorized with storing
technology skills.
• Mapping of transportation routes
• Increment in no. of stockhouses
• State should be strictly accountable
to the central controlling system, and
produce data of facts, status,
alongwith the set of programs viz.
distribution etc in real time manner,
as our proposed system is highly
network way connected.
• Inspectors and instructors are
needed to be recruited with strict
criteria to check the leakages, black
marketing and to ensure proper
storing techniques and control.

7. STATE-CONSUMER STAGE
The reformational elements of our REVOLUTIONARY system
1. SUVIDHA CARD
2. PACKET SYSTEM
3. COMMUNITY INSPECTORS
4. INFORMER
SUVIDHA CARD
• Its basically an electronic card through which the
consumer will access to the PDS.
• It will consist of- 1.Name 2.UID 3.Info. of family
4. Issue date 5.Photo, sign/thumb impression
6. Other features of accessibility and security.
• Through this card one gets information about govt
policies and other imp. notifications.
• It will also increase authenticity and decrease
personal errors.
• Implementation is easy as in case of ATMs.
PACKET SYSTEM
Lets admit it there are leakages along the way and then
targeted people suffer shortages. As per our system
 We’ll ensure packet allotment of prescribed quantity to
each account holder registered in database.
 Packaging of food grains will preserve them from factors
like moisture, chemical damage, and rodents attack etc.
 Packet system distribution policy will increase the
efficiency of PDS
 Packaging system may be easily implemented and
advantageously create employment opportunities for the
labor and slum section of the society.

8. COMMUNITY INSPECTORS
 Its an imp element of the system that will be the
intermediate between sellers and buyers.
 A person from each community of some strict
qualification say graduation may be appointed as
inspector who will ensure the quality and quantity of
stock arrived at PDS and report it.
 Ensure fair distribution, and coordinate with people, and
report every info. to the control panel.
 The inspector will be recruited on period basis and
thereby will change from time to time to make the
system even and fairly make it stable as well as
dynamic.
INFORMERS
 Informers will be persons working at the lowest but
most important level.
 They will be a combination of youth (like students) and
seniors ( retired officers).
 They will serve the purpose of informing the non-
educated BPL class people about various schemes of
PDS.
 They will work as a social worker BUT they will get
some incentives from the government foreg : Colg fees
of the informer student.

9. Our Proposed PDS system will have the following impacts and advantages:
Increased System Transparency and Accountability
“The most serious flaw plaguing the system at present is the lack of transparency and accountability in its functioning”
• The Complete Online Real time synchronization between the Central and State database will help in making the
system more transparent.
• The consumer can have his sight over the flow and status of the process, still the privacy is highly maintained.
• Since, each and every step is very transparent, So, not the system but the Employees will be accountable for any
flaws or malfunctioning.
• This will also ensure easy and efficient monitoring of each stage working in the system.
Good quality of Food grains and reduction in diversion
• The local community inspector will inspect for the quality of the food grains
• If any FPS is found to be indulging in malpractices, its licence will be cancelled immediately.
• The complete online system will reduce diversion to a very large extent.

10. Reduced PDS Leakages
“PDS Leakages will be reduced due to the following reasons:
• There will be route Mapping of all the Transportation of Food grains from FCI godowns to State godowns.
• The Local Community Inspectors shall inspect the shortages, quality and control and would be responsible for
initiating the action against it.
• Online biometric card swapping system will eliminate -
• inclusion errors,
• exclusion errors,
• double counting errors,
• Missing household errors and
• Shadow ownership error.
• The system will ensure that PDS serves its actual purpose of providing food security to each and every person
in INDIA
Good Grievance Redressal Mechanism
• “The role and sole of our system is COMMON MAN”
• There will be a strong grievance redressal committee which will include local members that will identify the grievances
and listen and respond to them immediately.
• Small farmers are encouraged and trained with better motivational, informational, and technical skills.

11. TotalCost
Initial Cost Technology
pos device INR 50000
data base
establishment INR 10000
suvidha card INR 5 lakhs
Working Cost
Organization
community officer INR 3 lakhs
training INR 2.5 lakhs
establishment and
logistic
training centers INR 1 lakhs
transport cost INR 5 lakhs
FUNDING
The above calculated costs are per annum calculations in a specific region having average population.

12. Suvidha card implementation may have some challenges and risks:
• With implementation of modern computing,
chances of hacking increases
• Initial cost will increase due to the installation
of digital devices at every booth
• Chances of malfunctioning or deactivation
of consumer account from data base may
occur.
• Proper firewall with regular updates and
regular modifications will decrease the risk
factor.
• Reduction in taxes at different levels
• Keeping alternative options will remove the
risk factor.

13. http://www.hindustantimes.com/Punjab/Ludhiana/FCI-rapped-for-wrong-procurement-policies/SP-Article1-
1073245.aspx
http://www.adb.org/publications/how-can-food-subsidies-work-better-answers-india-and-philippines
http://planningcommission.nic.in/reports/peoreport/peo/peo_tpds.pdf
Tenth Five Year Plan 2002-07
Eleventh Five Year Plan
National Food Security Bill 2013
NCERT Economics
http://indiatoday.intoday.in/story/problem-of-plenty-food-grains-left-to-rot-in-the-open-as-godowns-
overflow/1/252581.html
http://fciweb.nic.in/
http://pdsportal.nic.in/main.aspx
http://mospi.nic.in/