Public Distribution System In India

Contd....

Food Security System does not just entail keeping a large buffer stock of food grain; but it also means ensuring that it reaches even the poorest, most isolated segments of the country’s population.

India boasts of a huge reserve of surplus food grain, which by 2002 had swelled to three times the required quantity. But for some reason, mostly due to flawed agricultural policies, this huge reserve did not translate into meeting the food requirement of the entire nation—in fact, not even half of that requirement.

Apart from the high Minimum Support Price set by Government of India, which I had mentioned in my earlier post, the problem also lies with the food distribution system called the Public Distribution System (PDS). PDS in India operates through nearly 4 lakh fair price shops (FPS), of which more than 3 lakh shops are located in rural areas. According to the government, one FPS covers a population of nearly 2,000. This is one of the largest food distribution networks anywhere in the world.

Over the years, the government has constantly looked for new ways to improve the efficiency of PDS. In 1992, the government introduced a revamped PDS in few districts across the country. This improved system was intended mainly to serve areas which were difficult to reach (hilly and tribal areas), urban slums, drought prone areas and desert areas. This was more of a location targeted programme and covered everyone in the area. When even this revamped programme did not show the desired results, the system was further improved to target specific group of people. This was called Targeted Public Distribution System (TPDS). Its introduction followed the criticism that PDS in India was not catering to people below the poverty line. This flaw was addressed in TPDS, under which the population below poverty line (BPL) were issued food grain at extremely low rates. Starting at 10 kg per family per month, the quantity of grain issued was increased gradually to 35 kg per family per month.



To complement the public distribution system through fair price shops, the government has introduced various other schemes like Antyodaya Anna Yojana (AAY), Midday Meal and National Food for Work Scheme. Under Antyodaya Anna Yojana, the government has to provide the rice at Rs 2/kg and wheat at Rs 3/kg to BPL families, while bearing rest of the distribution cost.

All the above schemes have had a positive impact on the number of people aided by PDS, but the number is still extremely low. One has to undertake detailed scrutiny of its actual functioning to find the numerous flaws (mainly hidden) that have left the entire system unstable.

The biggest problem, like in any other government scheme, is corruption. Poor supervision of fair price shops and lack of accountability have spurred a number of middlemen who eat up (literally) a good proportion of the stock meant for the poor. There is also no clarity as to which families should be included in the BPL list and which excluded. This leads to inclusion of families not entitled for food subsidies and exclusion of deserving families.

The other major problem is that the stock assigned to a single family cannot be bought in installments. If a family is not able to buy the entire assigned stock at one go due to lack of money or any other reason, there is no provision to allow them to take a part of it and rest of it later. This is one of the biggest bottlenecks in the efficient functioning of PDS in India.

Many BPL families are not able to acquire ration cards either because they are seasonal migrant workers or because they live in unauthorized colonies. A lot of families also mortgage their ration cards for money.
These are a few major problems that government needs to overcome with immediate effect to make the Public Distribution System really effective.

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Food Security For whom?

‘Water, water, everywhere,
nor any drop to drink’
- ‘The Rime of Ancient Mariner’

Replace water with food in this famous expression of despair, and it will typify exactly the condition of a large chunk of India’s population right now.

On World Food Day (October 16) this year, India came to know that it was home to almost half of the world’s hungry. Nearly 35 percent of India’s population, or 350 million people, end their day with an empty stomach, leave alone the average nutrition level among Indians which is so low as to be even more heart wrenching. Close to 90 percent of pregnant women aged between 15 and 49 are undernourished and anaemic; more than 57 million children below 5 years, around 40 percent in this age group, are gravely malnourished. India attained self sufficiency in food grain production in [year], long before China, and today, China has only has 7 million children suffering from malnutrition compared to India’s 57 million, a fact which shows how dismal the Indian government’s performance has been on this front.



The Global Hunger Index brought out by International Food Policy Research Institute (IFPRI) in year 2008, ranks India 94th among 119 countries. Considering India’s food surplus, this must surely come as a surprise to many, but more importantly, it represents a wake up call for the government.

In 2002, FCI (Food Corporation of India) recorded a foodgrain stock of nearly 62 million tonnes when the required stock was only around 20 million. Keeping a buffer stock is no doubt an indispensable component of ensuring food security, but shouldn’t the government be aware of the adverse consequences of overstocking?

FCI procures foodgrains from farmers at the prevailing Minimum Support Price (MSP) to ensure that production is not halted for want of remunerative prices for the farmers’ produce. However, the MSP in recent years has been excessively high, resulting in a lot of farmers selling a major part of their produce to FCI. There have been instances even of farmers buying food grains from the market and selling to FCI at MSP which is higher than market prices.

All this might imply a rosy picture for the farmers, but economics is never so uncomplicated, is it? We must understand that only the already well off big farmers, who constitute the rural rich, stand to benefit. Ironically, it is they who need absolutely no support from the government. It is the weaker sections of rural society, comprising small and marginal farmers, whose condition has only deteriorated due to high levels of MSP.

With its corporate headquarters in Delhi, Food Corporation of India has only 5 zonal offices across the country and a limited number of procurement centers. These centers are virtually inaccessible to most poor farmers in rural areas, thus defeating the very purpose of a Minimum Support Price policy. Most of these poor farmers have to depend on the market to meet their food requirement as their own produce is not sufficient for their needs.

Because of high MSP prices, market prices, too, climb skywards. This is attributed to low supply conditions in the open market as most of the foodgrain production finds its way to FCI warehouses. And such high market prices spell trouble and empty stomachs for vast numbers of needy citizens in India.

States worst affected by this phenomenon are Madhya Pradesh, Bihar and Gujarat; while Himachal Pradesh, Kerala, Punjab and Jammu and Kashmir appear to be somewhat better off.

The one step that might improve the food security situation in India is to increase the number of FCI procurement centers, locating a majority of such additions deep in the rural hinterland. This will not only give access to lakhs of farmers, but also encourage the production of local food grains. The other step is to control the Minimum Support Price regime, constantly varying it according to the prevailing market situation.

Such steps address the problems caused by the procurement process, as also the problem of providing, at least partially, some purchasing power to the rural poor; but there is another hurdle that blocks the way towards a food secure India: the nature and condition of the Public Distribution System (PDS) in the country.
…….To Be Continued

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