One of the major objective of any government is to provide the basic amenities to its citizens. The most important things for public is housing, food, and employment. The government of India since 1947 is coming up with different schemes and programes for the welfare of its subjects. Food Policy for the poor section of the society has been a major concern for the government of India and it is spending a crucial portion of its budget on food subsidies and food transfers.
The public distribution system or PDS refers to a network of retail outlays popularly known as ration shops through which the government sells grain and kerosene. Grain sells occur at a fixed price called ‘issue price’ that is typically lower than the market price. However, how far PDS has benefitted the poor in India is still a big question.
In 1999-00, 36% of poor households report purchase of rice or wheat from the PDS. The corresponding figure for non-poor households is 31%. If the rural and urban sector are to be considered separately, the PDS participation rate of poor rural households is no different from that of non-poor rural households (35%). The small disparity in overall participation rate is driven by the urban sector where 37% of the poor households use. These figures establish that while the PDS includes significant number of non-poor, it also excludes the bulk of the poor.
Within the overall picture, there are networthy regional differences. More than 70% of the poor use the PDS in Andhra Pradesh, Karnatak, Kerala and Tamil Nadu. Between 50% and 60% of the poor use the PDS in Assam, Gujarat, Maharasthra and Odisha. Participation rates of the poor vary between 6% to 22% in Bihar, Madhya Pradesh, Rajasthan and Uttar Pradesh. As far the non-poor, their participation rate are lower than that of the poor across state, the correlation between participation rate of the poor and non-poor is 0.98. This has led some analysts to conclude that the interest of the poor lie in the universal subsidy scheme rather than targeted schemes. Case smalls have thrown up a variety of reasons for low participation rates of the poors such as the difficulty in obtaining the ration card, limited liquidity of the poor household, uncertain ration supplies, inferior quality of the PDS grains, inconvenient location of the PDS shops, and the slender subsidy offered in most states where households have easy access to PDS shops are also the states with high participation rates.
The PDS does not accomplish its aim of ensuring essential consumer goods to the poor at reasonable prices. Large part of the country simply do not have a distribution network to reach the remotest part of the nation where they are badly needed. In states like Kerala, WB and Tamil Nadu which have such network, the coverage is not limited to the poor. And attempts to ensure better targeting have been thwarted by the administrative difficulties and political opposition. The efficiency of PDS as a poverty alleviation measure and the desirability of confirming it in the present form is being questioned. Supporters of PDS, who see it as a major instrument for ensuring food security for the poor, strongly oppose this prescription even as they recognize the need for restructuring the programme.
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