Deprecated (16384): The ArrayAccess methods will be removed in 4.0.0.Use getParam(), getData() and getQuery() instead. - /home/brlfuser/public_html/src/Controller/ArtileDetailController.php, line: 73
 You can disable deprecation warnings by setting `Error.errorLevel` to `E_ALL & ~E_USER_DEPRECATED` in your config/app.php. [CORE/src/Core/functions.php, line 311]
Deprecated (16384): The ArrayAccess methods will be removed in 4.0.0.Use getParam(), getData() and getQuery() instead. - /home/brlfuser/public_html/src/Controller/ArtileDetailController.php, line: 74
 You can disable deprecation warnings by setting `Error.errorLevel` to `E_ALL & ~E_USER_DEPRECATED` in your config/app.php. [CORE/src/Core/functions.php, line 311]
Warning (512): Unable to emit headers. Headers sent in file=/home/brlfuser/public_html/vendor/cakephp/cakephp/src/Error/Debugger.php line=853 [CORE/src/Http/ResponseEmitter.php, line 48]
Warning (2): Cannot modify header information - headers already sent by (output started at /home/brlfuser/public_html/vendor/cakephp/cakephp/src/Error/Debugger.php:853) [CORE/src/Http/ResponseEmitter.php, line 148]
Warning (2): Cannot modify header information - headers already sent by (output started at /home/brlfuser/public_html/vendor/cakephp/cakephp/src/Error/Debugger.php:853) [CORE/src/Http/ResponseEmitter.php, line 181]
Notice (8): Undefined variable: urlPrefix [APP/Template/Layout/printlayout.ctp, line 8]latest-news-updates/taking-on-nac-babu-calls-for-pds-wind-up-by-rajeev-deshpande-4056.html"/> LATEST NEWS UPDATES | Taking on NAC, babu calls for PDS wind-up by Rajeev Deshpande | Im4change.org
Resource centre on India's rural distress
 
 

Taking on NAC, babu calls for PDS wind-up by Rajeev Deshpande

While the Sonia Gandhi-led National Advisory Council's proposal on enhanced food security hinges on higher procurement and increased reliance on the public distribution system, there is a strong view in the government that overworking a creaking system is a bad idea.

In a paper circulated within the government, chief economic adviser to the finance ministry Kaushik Basu has argued that what is needed for food security to work is a reduced role for the Food Corporation of India, winding up of the PDS system and interventions in the food market.

Basu has said in his paper on food security circulated in September that timely purchases and sales in the open market can help stabilize prices and these decisions need not require political clearance. Buy cheap and sell when prices either go up too high or fall too low is the mantra.

The adviser is not the first to speak of reforming PDS by way of introduction of food coupons but his assessment that the fair price shop system is pretty much beyond repair suggests that UPA 2's prestigious food security plan could be at risk if it depends on a leaky delivery system.

The paper does not challenge the need for a food security law. In fact, it says this is doable, but seeks to underline the apprehension, shared by many in the government, that it might be money down the drain unless targeted precisely. Plans to enhance food security through the PDS network need a hard look as a massive increase in procurement might prove unmanageable.

Basu says the problem arises through food subsidy being handed over to poor households via ration shops while pointing to the dangers of granting rights too easily if these entitlements are difficult to satify. He refers to a study that 70% of wheat under BPL does not reach beneficiaries.

Instead, the subsidy should be handed to poor households and food coupons can be used at any store and redeemed at a bank for cash by the shop owner. With a fixed cash value, it can be left to the household to decide its food mix at a certain rate. He does not, however, touch upon varying rates — there is no guarantee that cheap rice or wheat will cost the same which might mean a variable subsidy.

Basu counters the criticism that food coupons could be sold by pointing out that there was no way of monitoring that PDS foodgrains are actually consumed by the poor. It suggests food coupons could be given to adult woman members of a household to see if this helps foodgrains reach family members in a more reliable manner.

The food coupon system could be dovetailed into the unique identity number, or Aadhaar system and eventually coupons could be replaced by smart cards linked to a mobile banking system. As such, this policy looks better than the existing one, it is certainly worth attempting, the paper says. If India moves to a system of redeemable coupons, it will rob shopkeepers of the incentive to divert cheap foodgrains and the state's involvement will be reduced and more efficiently geared towards maintaining buffer and emergency stocks.