Syllabus: Issues related to farm subsidies and MSP; Public Distribution System — objectives, functioning, limitations, revamping; issues of buffer stocks and food security; Technology missions; economics of animal-rearing.
Context: Centre launched digital initiatives including AI platform ASHA for PDS feedback, Bhandaran 360 ERP, and Smart EXIM Warehouse System to modernize warehousing and improve supply chain efficiency.
More in News:
- Anna Sahayata Holistic AI Solution (ASHA) is AI-based platform allowing beneficiaries to share ration distribution feedback through AI-enabled calls in preferred language at ₹5 lakh cost.
- ASHA platform reaches 20 lakh beneficiaries monthly across India, using multilingual translation, sentiment analysis, automated grievance categorization, and real-time dashboards for administrators efficiently.
- Central Warehousing Corporation’s Bhandaran 360 is new enterprise resource planning platform integrating 41 modules covering HR, finance, marketing, warehouse management, contract management, project monitoring.
- Smart EXIM Warehouse System launched for container freight stations and general warehouses; ANNA DARPAN microservices-based platform replaces existing Depot Online System for modernization efforts.
- These initiatives support government’s mission of reducing logistics costs, minimizing turnover time, synchronizing different transportation modes for enhanced transparency across PDS operations nationwide.
PDS in India
- Overview
- The Public Distribution System (PDS) is a key pillar of India’s food security framework, delivering subsidised food grains to vulnerable households.
- It evolved from an inter-war arrangement to a nationwide system addressing scarcity and ensuring equitable food access.
- Structure and Functioning
- Operates under joint responsibility of Union and State governments.
- FCI manages procurement, storage, transport and bulk allocation of grains.
- States distribute grains through Fair Price Shops (FPS) to eligible families.
- Items include rice, wheat, sugar and kerosene, with some States adding pulses and oils.
- The PDS reaches 800 million people through half a million FPS (World Bank).
Key Issues with PDS
- Leakages and Corruption
- Nearly 28% of grains fail to reach beneficiaries, causing annual losses of ₹69,108 crore.
- Leakage causes include weak monitoring, corruption, poor infrastructure and targeting failures.
- High Coverage, Low Efficiency
- Covers 57% of population under schemes like PMGKAY, yet systemic inefficiencies persist.
- Impact on Food and Nutritional Security
- Leakages reduce subsidised grain availability, worsening hunger.
- Free rice and wheat alone do not meet diverse nutritional needs, especially for young children.
- Corruption and Administrative Gaps
- Reforms like PoS devices and Aadhaar authentication helped but did not eliminate inefficiencies, especially in high-corruption States.
Major Government Initiatives
- National Food Security Act (NFSA), 2013
- Covers 75% of rural and 50% of urban populations (81 crore beneficiaries).
- Improved efficiency; States like Bihar, Chhattisgarh and Odisha achieved steep leakage reduction.
- PMGKAY
- Provides free food grains to 81.35 crore beneficiaries; extended for five more years from January 2024.
- PM-POSHAN
- Enhances child nutrition and encourages schooling through nutritious mid-day meals.
- Antyodaya Anna Yojana (AAY)
- Supplies highly subsidised food grains to the poorest households.
Reforms and Future Directions
- Technological Integration
- Expand Aadhaar-based biometrics and PoS systems for transparency.
- Targeted Subsidies and DBT
- Provide free grain only to the most vulnerable; use cash transfers and food vouchers for flexibility.
- Revisiting Coverage
- Charge households above extreme poverty half of MSP, reducing subsidy burden.
- Strengthening Agriculture
- Redirect PDS savings to rural infrastructure and sustainable farming.
- Enhancing Nutritional Security
- Diversify PDS basket to include pulses, millets and nutrient-rich foods.
- Supply Chain Reforms
- Apply tech for real-time tracking and form dedicated inspection teams.
- Policy Reorientation
- Make PDS need-based, reduce leakages and address nutrition comprehensively.
Conclusion
- Continuous PDS reform is crucial to improve efficiency and nutritional outcomes.
- IMF notes that alternatives like Universal Basic Income (UBI) may support low-income groups but require careful implementation.
- Targeting the most vulnerable and reinvesting savings in agriculture can strengthen both food and nutritional security.
Q- Evaluate the major challenges in India’s Public Distribution System despite decades of reforms. (10 Marks)