Current Status of Public the Distribution System

  • Public Distribution System (PDS) is the most important step taken by the Government of India (GoI) towards ensuring food security.

  • In 1992, Revamped Public Distribution System (RPDS) was introduced in 1,700 blocks in the country.

  • The target was to provide the benefits of PDS to remote and backward areas.

  • From June 1997, in a renewed attempt, the Targeted Public Distribution System (TPDS) was introduced to adopt the principle of targeting the ‘poor in all areas.

  • In 2000, two special schemes were launched viz. , Antyodaya Anna Yojana *** (AAY) and Annapurna Scheme (APS) with special target groups of ‘poorest of the poor and ‘indigent senior citizens respectively.

  • The functioning of these two schemes was linked with the existing network of PDS.

  • The PDS has proved to be the most effective instrument of government policy over the years in stablising prices and making food available to consumers at affordable prices.

  • It has been instrumental in averting widespread hunger and famine by supplying food from surplus regions of the country to the deficit ones.

  • The system, including the minimum support price and procurement has contributed to an increase in foodgrain production and provided income security to farmers in certain region.

  • The Public Distribution System has faced severe criticism on several grounds. Instances of hunger are prevalent despite overflowing granaries.

  • FCI godowns are overflowing with grains , with some rotting away and some being eaten by rats.

  • The above graph shows the difference in foodgrain stocks in Central pool and its stocking norms.

Antyodaya Anna Yojana (AAY)

AAY was launched in December 2000 . Under this scheme, one crore of the poorest among the BPL families covered under the targeted public distribution system was identified. Poor families were identified by the respective state rural development departments through a Below Poverty Line (BPL) survey . Twenty-five kilograms of foodgrains were made available to each eligible family at a highly subsidized rate of ` 2 per kg for wheat and ` 3 per kg for rice. This quantity has been enhanced from 25 to 35 kg with effect from April 2002. The scheme has been further expanded twice by an additional 50 lakh BPL families in June 2003 and in August 200 4. With this increase, 2 crore families have been covered under the AAY.  

 

Note:

Subsidy is a payment that a government makes to a producer to supplement the market price of a commodity . Subsidies can keep consumer prices low while maintaining a higher income for domestic producers .

  • In 2014, the stock of wheat and rice with FCI was 65.3 million tonnes which were more than the minimum buffer norms.

  • The situation improved with the distribution of foodgrains under different schemes launches by the government.

  • Freezing of MSP for a few years should be considered seriously.

  • The increased food grains procurement at enhanced MSP i s the result of the pressure exerted by leading foodgrain-producing states, such as Punjab, Haryana, and Andhra Pradesh.

 

Note:

The rising Minimum Support Prices (MSP) have raised the maintenance cost of procuring food grains by the government. Rising transportation and storage costs of FCI are other contributing factors to the increase.

  • As per the NSSO report No. 558 in rural India, the per person per month consumption of rice has declined from 6.38 Kg. in 2004-05 to 5.98 Kg in 2011-12.

  • In urban India, the per person per month consumption of rice, too has declined from 4.71 Kg in 2004-05 to 4.49 Kg in 2011-12.

  • Per Capita consumption of PDS rice has doubled in rural India and increased by 66% in urban India since 2004-05.

  • The per Capita consumption of PDS wheat has doubled since 2004-05 in both rural and urban India.

  • PDS dealers are sometimes found resorting to malpractices like diverting the grains to the open market to get better margin , selling poor quality grains at ration shops, the irregular opening of the shops, etc.

  • It is common to find that ration shops regularly have unsold stocks of poor quality grains left. This has proved to be a big problem.

  • When ration shops are unable to sell, massive stock of food grains piles up with the FCI.

  • With TDPS of three different prices, and family above the poverty line gets a very little discount at the ration shop.

  • The price for APL families is almost as high as the open market price , so there is little incentive for them to buy these items from the ration shop.
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Davneet Singh

Davneet Singh has done his B.Tech from Indian Institute of Technology, Kanpur. He has been teaching from the past 14 years. He provides courses for Maths, Science, Social Science, Physics, Chemistry, Computer Science at Teachoo.