What is Public Distribution System?

The Public Distribution System (PDS) is India’s food security system, which has evolved into affordable food distribution and emergency management system. Distribute food and nonfood items that subsidize the poor in India. The project began in June 1947. Over the years, PDSs have become an important part of the country’s government food control policies. PDSs are complementary in nature and are not intended to satisfy the needs of any household or part of the community for the goods distributed accordingly. PDS has helped establish socio-economic equity by alleviating hunger, malnutrition, and anemia among the poorest of the poor, BPL citizens, women, and children. Using ICT to reduce contact points further increases the efficiency of PDS.

Public Distribution System

Public Distribution System

The PDS is jointly managed by the central and state governments. The central government, through the Food Corporation of India (FCI), was responsible for the purchasing, storage, transportation, and wholesale supply of food grains to the state government. Operational responsibilities, including in-state distribution, identification of eligible families, issuance of ration cards, and oversight of Fair Price Stores (FPS) are the responsibility of the State.

Under the PDS, commodities such as wheat, rice, sugar, and kerosene are now shared between states for distribution. Some states/federal areas also distribute additional products such as legumes, cooking oil, iodized salt, and spices through PDS outlets.

Need for a Public Distribution System (PDS)

The need for PDS is for ensuring food security. It includes:

1. Affordability of food
2. Accessibility of food
3. Availability of food

Evolution of PDS in India

The evolution of PDS in India is as follows:

• The PDS was introduced as a wartime distribution measure during World War II. Until the 1960s, distribution through PDS relied primarily on imports of grain.
• It was expanded in response to the food shortage in the 1960s. The government then established the Agricultural Price Commission and FCI to improve domestic procurement and storage of food grains for PDS.
• By the 1970s, PDS had become a universal scheme for the distribution of subsidized foods.
• Prior to 1992, the PDS was a general entitlement scheme for all consumers with no specific purpose.
• The Improved Community Distribution System (RPDS) was launched in June 1992 to strengthen and streamline the PDS and extend its reach to remote, hilly, remote, and inaccessible areas where a significant proportion of the underprivileged live life.
• In June 1997, the Government of India launched the Targeted Public Distribution System (TPDS) for the poor. According to the TPDS, beneficiaries fall into two categories below the poverty line or BPL.
• Antyodaya Anna Yojana (AAY): AAY was a step towards creating a TPDS goal to reduce hunger among the poorest in the BPL. According to the national sample survey, about 5% of the total population sleeps without eating two meals a day. To make TPDS more focused and oriented to this population, Antyodaya Anna Yojana (AAY) was launched in December 2000 for the poorest billion families.
• In September 2013, Congress passed the National Food Security Act. 2013 Law This law builds on the existing TPDS to deliver grain as a legal right to poor households. This represents a transition that turns the right to food into an enforceable right.

Objectives and Significance of PDS

The objectives and significance of PDS are as follows:

Objectives of PDS

• Protect the low-income class by supplying a certain amount of grain at an affordable price.
• Ensures fair distribution.
• Price Control of Essential Goods in the Open Market.
• To exert a moderating effect on the open market price of grain.
• The distribution of grain accounts for a fairly large proportion of the total commodity surplus. Attempt to socialize in the distribution of necessities.

Mission of PDS

• We provide food grains for the poor at a price lower than the price of food grains in private stores.
• Food grains are purchased directly from farmers, ensuring higher prices for farmers.
• We provide products at fair prices to consumers, especially the socially disadvantaged/vulnerable class.
• Addresses the existing imbalance between supply and demand for consumer goods. Identify and prevent hoarding and black markets of commodities.
• Ensures social justice in the distribution of basic necessities.
• Mitigate price fluctuations and the availability of consumer goods.
• Supports poverty alleviation programs such as the Rural Employment Program (SGRY/SGSY/IRDP/PM, ICDS, DWCRA, SHG, and Food for Work) and Educational Nutrition Program.

Importance of PDS

• PDS ensures the country’s food and nutritional security by providing access to food for the poorest of the poor.
• The CBT maintains a buffered stock of food grains to keep food flowing strongly during crises.
• It has helped redistribute grain and brought food to the poor in surplus areas of the country.
• The minimum support price and purchase system contributed to increasing food production.
• Helps stabilize food prices.

How PDS System Function?

The functions of the PDS System are as follows:

• The PDS is administered under the joint responsibility of the central and state/Utah governments.
• The Central Government is responsible for providing food grains for CBT through the Food Corporation of India and providing subsidies for their use.
• The State is responsible for ensuring that beneficiaries have access to items sold under the PDS, coordinating the entire supply process from the FCI warehouse to the beneficiary, and monitoring the PDS. We support PDS products through FPS.
• FPS licensing and enforcement methods through vigilance boards and other government officials are detailed in the PDS Control Directive 2001 (GOI 2001) issued by the Ministry of Food and Public Distribution of the Government of India.
• FCI purchases food grains from farmers at a Minimum Supporting Price (MSP) and distributes food grains to all states at a single Central Selling Price (CIP).
• CIP is lower than the economic cost of the central government to buy food.
• The difference between the economic cost and the CIP is the food subsidy generated by the central government from the annual unplanned budget.
• The states set their final consumer price (CEP) at an FPS of 0.50 real per kilogram or less above the central selling price (CIP), especially for populations below the poverty line.
• States may also add coverage based on BPL categories and pay subsidies from their own resources.
• Operational responsibilities, including intrastate distribution, identification of eligible families, issuance of distribution cards, and oversight of Fair Price Stores (FPS) rest with the State.

Issues Associated with PDS System in India

• Identification of beneficiaries: Studies have shown that targeting mechanisms such as TPDS can lead to large inclusion and exclusion errors. This means that eligible beneficiaries will not receive food and eligible recipients will receive undue benefits. A group of experts established in 2009 estimated that SBR suffered from an exclusion error of nearly 61% and a beneficiary inclusion error of 25%. Misclassifying the poor as non-poor and vice versa.
• Leakage of food grains: (Leaks in transit + FPS owner hints) TPDS suffers from large leaks of food grains during transit to stores and open markets. In the TPDS assessment, the former planning committee found a 36% leak of rice and wheat PDS at the criminality level.
• The issue with procurement: Permanent purchases, i.e. if all incoming grains are allowed even if the buffer stock is full, there will be a shortage in the open market.
• Issues with storage: A performance audit conducted by CAG revealed a serious shortage of public storage. The lack of adequate covered storage space is a problem given the growing purchases and rotting food grains.
• The provision of the Minimum Support Price (MPP) discourages crop diversification by encouraging farmers to convert their land from fodder grains consumed by the poor to rice and wheat.
• Environmental issues: An overemphasis on achieving self-sufficiency and surplus crops, which require large amounts of water, has proven to be environmentally unsustainable. Buying states such as Punjab and Haryana are experiencing environmental stresses, including rapid groundwater depletion and soil and water degradation due to fertilizer abuse. Rice cultivation in northwestern India was found to reduce the water table by 33 cm per year during 2002-08.

Related Links

1. Challenges and Reforms of Public Distribution System
2. Government Initiative on Public Distribution System
3. Agriculture and Food Security

Frequently Asked Questions

Q 1. What are the benefits of a public distribution system?

Answer-

The Public Distribution System (PDS) was developed as a system to manage shortages by distributing food at affordable prices. Over the years, PDSs have become an important part of government policies to manage the country’s food economy.

Q 2. Who introduced ration cards to India?

Answer-

India’s Public Distribution System: Evolution, Efficiency, and Need for Reform. The evolution of public circulation of grain in India has its origins in the “card” system introduced by the British during World War II.

Q 3. How does PDS ensure food security in India?

Answer-

The Government Distribution System (PDS) distributes subsidized food and non-food items to the poor in India. Stocks in circulation included basic foods such as wheat, rice, sugar and kerosene through a series of fair-price stores, also known as multi-state grocery stores.