Food Security, useful for Kerala PSC exams as reference

Food Security

When we discuss Food Security, in the indian context and Kerala context- importance should be accorded to the PDS System

Public Distribution System

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A study about PDS is given below:

With a network of more than 400,000 Fair Price Shops (FPS), the Public Distribution System (PDS) in India is perhaps the largest distribution machinery of its type in the world. PDS is said to distribute each year commodities worth more than Rs15,000 crore to about 16 crore families. This huge network can play a more meaningful role if only the system is able to translate into micro level a macro level self sufficiency by ensuring availability of food grains for the poor households.

2. Access of the poor to food is a priority objective for two reasons: Firstly, though the growth of food grain production in 1989-99 was lower than the increase in
population during the same decade, procurement of grains was indeed going up, which
is suggestive of a decline in people’s consumption or in the purchasing power of the
poor. This may have happened because of structural imbalances in the economy: rising
capital intensity, lack of land reforms, failure of poverty alleviation programmes,
growing disparity between towns and villages, and the like. To this may be added
production problems in less endowed regions, which have led to a dangerous situation
of huge pile-up inside Food Corporation of India’s (FCI) godowns and widespread incidence of hunger outside. It is just as important to correct these policy imbalances as to increase food production. Secondly, if consumption of the poor does not increase there would be serious demand constraints on agriculture and could make the growth target of 4.5% per annum unachievable.
3. Huge as it may seem on paper, all is not well with the Public Distribution
System. A large subsidy each year keeps the system going (see Table below). A close
look at the Table would show that the level of food subsidies as a proportion of total Government expenditure has gone up from about 2.5 percent or below at the beginning of the 1990s to about 3 percent towards the end of the decade. One of the issues in the PDS operation has been how to contain the food subsidy within reasonable levels.

4. As it stood earlier, PDS was criticised on a wide front: its failure to serve
the population Below Poverty Line (BPL), for its perceived urban bias, negligible
coverage in States with a high density of rural poor and lack of transparent and
accountable arrangements for delivery. Given that backdrop, the Government acted to
streamline PDS during the Ninth Five Year Plan period by issuing special cards to
BPL families and selling to them foodgrains through PDS outlets at specially
subsidised prices (with effect from June, 1997).
5. Under the new Targeted Public Distribution System (TPDS) each poor family is
entitled to 10 kilograms of food grains per month (20 kg wef April 2000) at specially subsidised prices. This is likely to benefit about six crore poor families, to whom a quantity of about 72 lakh tonnes of food grains per year is earmarked. The identification of the beneficiaries is done by the States, based on state-wise poverty estimates of the Planning Commission. The thrust is to limit the benefit to the truly poor and vulnerable sections: landless agricultural labourers, marginal farmers, rural artisans/craftsmen, potters, tappers, weavers, blacksmiths, and carpenters in the rural areas; similarly those covered by TPDS in urban areas are slum dwellers and people earning livelihood on a daily basis in the informal sector like the porters and rickshaw pullers and hand cart pullers, fruit and flower sellers on the pavements, etc.

6. The allocation of food grains to States is based on consumption in the past,
that is, the average annual off-take during 1986-87 to 1995-96. Food grains out of thisaverage-lifting -- in excess of the BPL needs at the rate of 10 kg per family per month– are provided to the States as ‘transitory allocation’ and a quantity of 103 lakh tonnes is earmarked for this annually. This transitory allocation is intended to continue the benefit of subsidised grains to population above poverty line (APL) to whom an abrupt withdrawal of PDS facility was not considered desirable. The `transitory’ allocation is issued at prices which are subsidised but higher than prices fixed for the BPL quota.
7. Following the TPDS introduction, representations were received from several
States / Union Territories (UTs) that the new allocation was much lower than the
earlier level of allocations particularly during 1996-97. As a result of this and keeping in view the guidelines for implementation of TPDS, additional allocations -- over and above TPDS quota -- were made to States /UTs at economic cost from June, 1997 to November, 1997. At a Conference in September 1997, Chief Ministers reviewed the TPDS implementation and the states demanded that the additional allocations be made at APL rates. Accordingly, the additional quantiities are being allocated at APL rates from December 1997 subject to availability of food grains in the Central pool and constraints of food subsidy. The BPL/APL rates (Rs/kg) have been as follows during the Ninth Plan:

Diversion of PDS Commodities:
8. In response to complaints, a study was conducted by the Tata Economic Consultancy Services to know how much of PDS supplies were diverted from the
system. At the national level, it was found, there was a diversion of 36% of wheat
supplies, 31% of rice and 23% sugar. Statistically at 90%-confidence level, the actual diversion of wheat would fall in the range of 32-40%, rice in 27-35% and sugar 20-26%. Table-2 shows the extent of diversion in various States and Union territories. The Table shows that the diversion is more in Northern, Eastern and North Eastern regions; it is comparatively less in Southern and Western regions. A high 64% diversion of rice is estimated in Bihar and Assam. In the case of wheat the diversion is an estimated 100% in Nagaland and 69% in Punjab.
9. It is significant to note that the diversion is estimated less in the case of sugar as compared to rice and wheat. The PDS is better organized in towns where sugar is consumed while its infrastructure is weak in rural areas, especially in poorer Northern,Eastern and North Eastern States. A study in Bihar has reported the following Box.

10. Problems of lack of infrastructure and shortage of funds with Government
agencies are not unique to Bihar; most States suffer such handicaps except for a few in the West and the South. The Centre should ensure adequate infrastructural capacities in districts and at block levels to plug leakage of scarce resources which reportedly helps only contractors and corrupt government staff and keeps the poor and the needy away. One study claimed that each fair price dealer has to “maintain” on an average
nine government functionaries. It is significant that the allocation to poorer states like UP, Bihar and Assam got more than doubled after the switch-over to TPDS, but the offtake by the States was poor and by actual BPL beneficiaries even poorer. The scheme has not made any impact on nutrition levels in those States.