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Resource centre on India's rural distress
 
 

Stupid to abolish PDS, says Plan panel’s Abhijit Sen
-The Indian Express
 
A day after the World Bank suggested that India should shrink its public distribution system (PDS) in favour of more cash transfers, Planning Commission Member (Agriculture) Abhijit Sen told select mediapersons it would be “stupid to abolish PDS”.

A World Bank review of India’s social sector programmes titled “Social protection for a changing India”, commissioned by the Planning Commission, said though the PDS costs just 1 per cent of GDP and covers up to 23 per cent of households, its effect on poverty reduction is low due to high leakages. Sen, a noted agriculture economist, said that the mess in food management today is largely a result of the shift to a targeted PDS from a universal PDS in 1997. “Under targeted PDS, we are supplying food where the poor are, and not where there are shortages,” he said. The main objective of food management or the PDS should be to stabilise prices. “PDS should be for stabilisation. The poor are not necessarily in areas of deficit foodgrain stock,” he pointed out, citing Kerala’s example.

PDS has worked most in countries where it is universal, and not targeted — the way it is in India now. Further, Sen said, a country of the size of India, cannot assume it could sort out foodgrain supply problems by imports or exports. “We must stock foodgrain. It is the role of the government. But we must have a good system of release and purchase of these stocks to ensure stability,” he said.

The World Bank report said the main problems in the PDS are inadequate storage capacity in a number of states, requirement that households pay for their entire month’s ration in one shot, weak monitoring, lack of transparency and poor accountability of officials implementing the scheme. Sen said in the last three years, India’s food management ability hit a low. “The government has withdrawn 10-12 million tonnes from the market. Obviously, prices will go up,” he said. High minimum support prices and inability to increase ration supplies are the main reasons for the mess in food management, but PDS took the blame.

He further noted that politicians will never accept a dismantling of the PDS. “Forget the politicians, what matters most is what the voters think,” he said, adding that a recent study by think-tank NCAER had revealed that more than four-fifths of the voters thought the PDS worked “satisfactorily”.