New Delhi : Notwithstanding objections by many National Advisory Council (NAC) members to cash transfer-based food subsidy, the Empowered Group of Ministers (EGoM) has approved to provide for “cash transfers and Food Coupons”, among other options, in the proposed food security Bill. The EGoM, which met under Finance Minister Pranab Mukherjee’s chairmanship earlier this week, also approved “leveraging” aadhaar for unique identity numbers for “proper targeting” of food entitlements. Section 31(3)(g) of...

The World Bank and a pliant UPA Government plan to do away with India's public distribution system and shut down four lakh ration shops. The excuse-the Public Distribution System (PDS) spends Rs 45,000 crore every year to supply BPL families wheat, rice, kerosene and sugar of which 60 per cent of grain is looted by the food mafia. The 412page 'World Bank Report: Social Protection for Changing India', released on...

Indian farmers have much to celebrate this year with a bumper wheat harvest. As predicted by the ministry of agriculture, wheat farmers have begun to harvest what is shaping up to be a record crop, projected at 84.27 million tonnes. We are growing more wheat than ever before. The earlier record of 80.8 million tonnes of wheat production was achieved in 2009-10. Estimates show that foodgrain production including wheat, rice, pulses...

Cash transfers are now suggested by many as a silver bullet for addressing the problems that plague India’s anti-poverty programmes. This article argues instead for evidence-based policy and informed public debate to clarify the place, prospects and problems of cash transfers in India. By drawing on key empirical findings from academic and grey literature across the world an attempt is made to draw attention to three aspects of cash transfers...

The current perception that cash transfers can replace public provision of basic goods and services and become a catch-all solution for poverty reduction is false. Where cash transfers have helped to reduce poverty, they have added to public provision, not replaced it. For crucial items like food, direct provision protects poor consumers from rising prices and is part of a broader strategy to ensure domestic supply. Problems like targeting errors...