PDS/ Ration/ Food Security

KEY TRENDS

• During 2014-15, while procurement of foodgrains (rice and wheat) increased from 56.9 million tonnes to 60.2 million tonnes, offtake of foodgrains (rice and wheat) from the PDS decreased from 59.8 million tonnes to 55.9 million tonnes. Despite increased availability in the PDS and prevalence of high inflation in foodgrains, dependence on the PDS is reducing, suggesting that there may be issues of availability, timely availability and quality of the PDS foodgrains $*
 

• The PDS share in rice consumption in 2011-12 was about 27.9 percent in the rural sector and about 19.6 percent in the urban sector. The proportion of households reporting PDS purchase of rice during a 30-day period was 46 percent in the rural sector and about 23 percent in the urban sector **

• The share of PDS in wheat/atta consumption was about 17.3 percent in the rural sector and about 10.1 percent in the urban. The proportion of households reporting PDS purchase of wheat/atta during a 30-day period was about 34 percent in the rural sector and 19 percent in the urban sector ** 

• The per capita consumption of PDS rice has doubled in rural India and risen by 66% in urban India since 2004-05, implying that the share of PDS purchases in rice consumption has risen substantially. The share of PDS purchase in wheat consumption has increased considerably, per capita consumption of PDS wheat having more than doubled since 2004-05 in both sectors $

• FCI owned storage capacity remained more or less constant ranging between 151 lakh metric tonne (LMT) and 156 LMT during the period 2006-07 to 2011-12. The foodgrains stock in the Central Pool steadily increased to 824 LMT on 1 June 2012. As a result, hiring of storage space by FCI increased from 100 LMT to 180 LMT during the period significantly adding to hiring charges from Rs. 322 crore in 2006-07 to Rs. 1119 crore in 2011-12. Further, due to constraints in available storage capacity, FCI could not take over stock of wheat procured by State Governments Agencies for the Central Pool within the prescribed time frame of June each year. This led to increase in payment of carry over charges to State Government Agencies from Rs. 175 crore in 2006-07 to Rs. 1635 crore in 2011-12 for holding of foodgrains beyond the prescribed time α

• The storage gap in FCI against the Central Pool stock witnessed a steady increase during the period 2006-07 to 2011-12. Against the storage gap of 332 LMT (March 2012), GoI/ FCI envisaged capacity addition of only 163 LMT during the 6 year period under various augmentation programmes. Out of this, only 34 LMT was completed (March 2012) α

• There has been a revival of the Public Distribution System in several states. The contribution of PDS purchases to total consumption in 2009-10 shows a considerable rise compared to 2004-05, particularly for rice and wheat/atta €

• The share of PDS purchase in rice consumption in 2009-10 was about 23.5% in the rural sector (1.41 kg out of 6.00 kg per person) and about 18% in the urban (0.81 kg out of 4.52 kg per person). In 2004-05, the PDS share in rice consumption had been about 13% in the rural sector and 11% in the urban €

• The share of PDS in wheat/atta consumption in 2009-10 was about 14.6% (0.62 kg out of 4.25 kg per person) in the rural sector, double what it was in 2004-05 (7.3%), and about 9% in the urban sector, compared to only 3.8% in 2004-05 €

• The Chhattisgarh Food Security Act was passed on 21 December 2012 to ensure “access to adequate quantity of food and other requirements of good nutrition to the people of the state, at affordable prices, at all times to live a life of dignity”.

• Under the Consumer Protection Act, 1986 and Delhi Citizens' Charter 2011, consumers are empowered to file complaints in case of unfair trade practice of the PDS dealer/ trader, defect in goods, deficiency in services, sale of unsafe goods and overcharging in excess of that stamped on the product.

• The Delhi Citizens' Charter 2011 makes it mandatory for the fair price shops to proactively display the following information: 1. License No./ Name of PDS outlets; 2. Stock as on date; 3. Weekly off; 4. Rates of Commodities; 5. Sample of Sugar, Wheat and Rice; 6. Timing of PDS outlets Fair Price Shop/KOD i.e. 9:00 am to 1:00 pm and 3:00 pm to 7 pm; 7. Complain Register is available. 

• The PDS operates through a large distribution network of around 4.89 lakh fair price shops (FPS), and is supplemental in nature **

• Access to ration card by the land poorest section in the rural areas is minimal. 51% of households in the lowest size class of landholding “<0.01 hectares” had no ration card at all *

• 81% of rural households and 67% of urban households held ration cards *

• Antyodaya cardholders formed less than 3% of rural households and less than 1% of urban households *

• In rural areas, the percentage of households having Antyodaya cards was 5% for Scheduled Tribes (ST), about 4.5% for Scheduled Castes (SC), and 2% for the other groups *

$* Economic Survey 2015-16, Ministry of Finance, Volume 1 and Volume 2  

** NSS 68th Round report entitled: Public Distribution System and Other Sources of Household Consumption, 2011-12 (released in June 2015), please click here to access 

$ NSS Report entitled Household Consumption of Various Goods and Services in India 2011-12 (NSS 68th Round, July 2011-June 2012), released in June 2014 (please click here to download)

α Report of the Comptroller and Auditor General of India on Performance Audit of Storage Management and Movement of Food Grains in Food Corporation of India, Report no.-7 of 2013-Union Government (Ministry of Consumer Affairs, Food and Public Distribution),
http://saiindia.gov.in/english/home/Our_Products/Audit_Rep
ort/Government_Wise/union_audit/recent_reports/union_perfo
rmance/2013/Civil/Report_7/Report_7.html
 

€ NSS 66th Round Report titled: Public Distribution System and Other Sources of Household Consumption (July 2009-June 2010), http://mospi.nic.in/Mospi_New/upload/nss_report_545.pdf

* Public Distribution System (PDS) and Other Sources of Household Consumption, 2004-05, NSS 61st Round, (July 2004 - June 2005), Volume I

Since the nineteenth Century, the British Raj had vast experience of facing droughts and famines, and very often helplessly. The British Famine Commission had estimated in the 1880s that “…in times of very great scarcity, prices of food grain rise to three times their ordinary amount” (B G Kumar, 1988). It is in this backdrop that the achievement of India’s imperfect Public Distribution System (PDS) become significant. According to the author, it was due to the PDS that the prices of food grain never rose beyond 10 per cent in the worst years of drought, scarcity and failed crops since independence. Compared to 1,50,000 deaths in the 1942 drought (Samra J S 2004), even the most uncharitable estimates of deaths in the 2002 drought, one of the worst in over four decades, were below 100.  

It is well known that a large portion of food grain meant for the PDS is pilfered and sold in the black market, and that this sort of corruption is on the rise. However, what is equally true but not so well known is that in some of free India’s worst years of droughts and food scarcity the self sufficiency in food, adequate storage facilities and the PDS brought the country back from the brink. The PDS played three important functions, particularly during droughts and crop failures: a) distribution of food far and wide through fair-price outlets popularly known as the ‘ration’ shops, b) income generation through labour intensive food for work programmes, and c) price stabilization by augmenting availability in the market. 

The big achievement of the PDS hence was to stop prices from spiraling to something like three times their normal price as was prevalent during the British Raj. It also played a role in controlling hoarding and black marketing. Within India the best example of public distribution having an impact on the state’s overall wellbeing comes from Kerala. Unlike most of India where the PDS is confined to the urban areas, in Kerala it penetrated the rural areas very well and emerged as an important instrument of public policy against hunger and deprivation. In terms of resources and prosperity Kerala is behind many other states like Punjab and Haryana but is ahead of most in terms of literacy, health services and many social indicators like the life expectancy.