Revised Version
Strategic Plan Document
for
Department of Food and Public Distribution,
Government of India
Smita Chugh
and
K.Raju
Phase V Training
LBSNAA
Mussoorie
6th January, 2011
1
Table of Contents
Executive Summary ........................................................................................................................ 3
Chapter 1: Department of Food and Public Distribution: Vision, Mission,
Objectives and Functions ............................................ Error! Bookmark not defined.
Chapter 2: Assessment of the Situation................................................................................... 5
Chapter 3: Outline of the Strategy ...........................................................................................14
Chapter 4: Implementation Plan ..............................................................................................17
chapter 5: Linkage between Strategic Plan and RFD………………………………………..37
Chapter 6: Cross departmental and cross functional issues……………………………..38
Annexure 1: ICT initiatives undertaken by different states ..........................................39
References ..................................................................................................................................... 422
2
Executive Summary
Access to food continues to be a major issue for a substantial section of Indian
population. Per capita cereal consumption of the Indian population has been declining in
both rural and urban areas over the past two or three decades, as has annual per capita
availability of foodgrains.
While efforts to improve food security have gathered momentum with the proposed
National Food Security Act, these can come to naught unless systems for procuring,
storing and distributing foodgrains are not improved. Currently, food security is
primarily ensured through the Public Distribution System (PDS) which targets around
400 million people and is budgeted at around for Rs.55,000 crore annually. However
several studies including an evaluation by Planning Commission in 2004-05 reveal a
number of problems in the implementation of the PDS. The scheme, the evaluation says,
is affected by targeting errors (both inclusion and exclusion errors), spurious
beneficiaries, diversion and pilferage and even location specific availability. Since
Government of India is committed to bring out the National Food Security Act shortly,
PDS becomes more important and critical for ensuring the ‘Right to Food’ being
guaranteed to the people under the Act.
This Strategic Plan document proposes a new vision and strategy for the PDS such that
not only does every household in the country is enabled to access foodgrains in a
manner that it is food secure at all times; but also that foodgrains entitled to it are
delivered at the notified price, with utmost efficiency and in a most transparent manner.
The plan proposes a five-fold strategy. As a first step, it proposes the setting up of a PDS
Mission that takes the responsibility for bringing out policies in accordance with the
Strategic Plan; for establishing systems and mechanisms for procuring, storing and
delivering foodgrains to the targeted households; using consultative processes to help
states prepare plans for reform and facilitating their implementation; and for
monitoring performance. Second, the plan suggests a complete revamping of the
procurement, storage and distribution system as existent under the present PDS. This
can be done by encouraging decentralized procurement as far as possible; adopting a
bottom-up planning approach for estimating demand and supply gaps; PPSs in select
areas; and through improvement in the network and service delivery of fair price shops.
Models to implement these innovations are presented. Third, to improve supply side
management, an end-to-end ICT architecture is proposed, as are means to implement it.
The fourth strategy focuses on strengthening transparency, accountability and grievance
redressal mechanisms. Finally, the plan focuses on ways and means to promote
community participation, which is presently very low/almost non-existent in the PDS.
3
Chapter 1: Department of Food and Public Distribution:
Vision, Mission, Objectives and Functions
1.1 The Vision
The Vision of the Department of Food and Public Distribution (DFPD), Government
of India (GOI) is that every household in the country is enabled to become food
secure at all times.
1.2 The Mission
The foodgrains entitled to the households under PDS are delivered to every eligible
household at the notified price, with utmost efficiency, in a most transparent manner
1.3 The Objectives
The Department’s objectives are management of food economy of the country
through efficient procurement, storage and distribution of foodgrains (cereals),
ensuring availability of foodgrains, and securing access to the below poverty line
(BPL) families families at affordable price.
1.4 The Functions
The Department is mandated to perform wide rang of functions which include,
Procurement of Foodgrains through Minimum Support Price (MSP) operations from
across the country, Storage and transportation of foodgrains up to District point,
allocation of foodgrains to the states based on poverty estimate of the state, fix prices
for distribution of foodgrians to BPL and above poverty line (APL) families through
FP shops and distribution of foodgrians to other food related schemes such as ICDS
and Mid-day meals programs,
The Strategic Plan document presented here covers only the Public Distribution
System (PDS) as the Dept of Food and Public Distribution’s human resources and
financial resources are primarily devoted to the Public Distribution System. The
Department’s functions with regard to Sugar and Edible Oils are not covered in this
Strategic Plan. Since Government of India is committed to bring out the National
Food Security Act shortly, PDS becomes more important and critical for ensuring the
‘Right to Food’ being guaranteed to the people under the Act.
4
Chapter 2: Assessment of the Situation
2.1.
The Republic of Hunger
2.1.1. Access to food continues to be a major issue for a substantial section of Indian
population. Although there have been no widespread famines in India since
Independence, the rates of chronic under-nutrition in the country, is amongst the
highest in the world.
2.1.2. Almost one in two children are underweight or stunted and one-third of adults
have a low BMI (body mass index) (NFHS-3). According to the ranking of the status
of hunger of various countries using the Global Hunger Index (GHI) by the
International Food Policy Research Institute (IFPRI), India’s score is 23.7, which
gives it a rank of 66th out of 88 countries. According to the India Hunger Index report
this score indicates continued poor performance at reducing hunger in India”. India
ranks below several countries in Sub-Saharan Africa, such as Cameroon, Kenya,
Nigeria, and Sudan; even though per capita income in these Sub-Saharan African
countries is much lower than in India.
2.1.3. Some of the reasons for this grim picture in India are as follows: With a 500600 kcal deficit in energy intake (almost 40% of their requirement) and multiple
nutrient deficiencies such as fat, calcium, iron, riboflavin, vitamin C (all 50% deficit)
and vitamin A (70% deficit), it is not surprising that there is massive inadequacy/
hunger leading to malnutrition.
2.1.4. Diet surveys shows that over 70 to 80% of the calories consumed by the
children (even though inadequate) are derived from cereals and pulses. However, per
capita cereal consumption of the Indian population has been declining in both rural
and urban areas over the past two or three decades. While overall expenditure on food
too has declined, expenditure on cereals has witnessed a dramatic decline from 40.6
percent in rural areas in 1972-73 to 18 percent in 2004-05 and from 23.3 percent to
10.1 percent in urban areas respectively (see Table 2.1). The increase in the share of
non-cereals has not been enough to compensate for the decline in cereal consumption.
Overall, per capita intake of calories and protein has declined consistently over a 20year period from 1983 to 2004/5, according to NSS data. Rural calorie consumption
per day has fallen from 2221 to 2047, an 8% decline. Similarly, the urban calorie
consumption fell by 3.3%, from 2080 to 2020 (Source: Planning Commission).
5
Table 2.1: Composition of Food Consumption, All India, rural and urban 197273 to 2004-05
Source: Planning Commission
2.1.5. On the other hand, annual foodgrains availability per head of total population,
has fallen steeply from 177 kg in the early 1990s, to only 153 kg by 2003-04, with
over four-fifths of the fall coming after 1998 (see figure 2.1). This level prevailed 50
years ago, in the early 1950s, and is lower than the 157 kg average during 1937-41.
This steep fall in foodgrains availability per head (Chart 1) is a highly abnormal trend,
which is not expected when per capita income is rising (Patnaik 2007). The
explanation, according to Patnaik (2007) can only lie in worsening income
distribution of a particular type – an absolute decline in incomes and purchasing
power for a major part of the population, outweighing rise for the minority with fast
rising incomes. Therefore, access to foodgrains at affordable prices becomes not only
a food security measure but also an important social security net to the poor in the
country.
6
Figure 2.1: Annual per capita output and availability of foodgrains, triennial
average ending in specified years
Per Capita Output kg
Per capita availability, kg
Source: Patnaik, 2007
1991-92
178.8
177
1994-95
181.6
174.3
1997-98
176.8
174.2
2000-01
177.7
163.2
2002-03
164.1
153
2.1.6. Efforts to improve food security have recently gathered momentum with the
National Advisory Council, under the leadership of Mrs. Sonia Gandhi, undertaking
the task of drafting a National Food Security Bill. If accepted as legislation, the
National Food Security Act (NFSA) will go a long way in ensuring food security to
all citizens of India.
2.2.
Evolution of the Food Procurement Policy and Public Distribution
System
2.2.1. As far as food procurement goes, until the mid 1990s cereal procurement was
concentrated in a few northern States. However, under the Decentralized
Procurement Scheme (DPS) introduced in 1997-98, the State Governments
themselves undertake direct purchase of paddy and wheat and procurement of levy
rice on behalf of the Government of India. In the event of the total quantity of wheat
and rice thus procured falling short of the total allocation made by the Central
Government, the Food Corporation of India (FCI) meets the deficit out of the Central
Pool stocks. While the scheme has been very successful in increasing the procurement
of cereals, particularly rice in many non-traditional states (see table 2.2), there is a
need for states to increase procurement to reduce their requirement of food grains
from the Central Pool. There is also a need for more states with large production, such
as Bihar for wheat and rice and Assam for rice, to adopt the Decentralized
Procurement Scheme.
7
Table 2.2: Procurement of Rice in DCP States during Kharif Marketing Season
(figures in lakh tonnes)
Source: Planning Commission
2.2.2. Yet another problem under decentralized procurement is the extent of food
subsidy needed to meet state requirements. Under the scheme, state specific economic
cost is determined by the Government of India and the difference between the
economic cost so fixed and the central issue prices is passed on to the states as food
subsidy. In addition, the Central Government also procures food grains for meeting
the requirements of buffer stock. Hence, part of the food subsidy also goes towards
meeting the carrying cost of buffer stock. The food subsidy bill of the Government of
India peaked in 2004-05 to Rs. 25746 crores and declined as stocks declined.
However, there is a danger of the subsidy bill rising due to increase in Minimum
Support Prices (MSPs) and carrying costs of FCI. Food subsidies are likely to inflate
further if the NFSA comes into place and estimated requirement for buffer stock
increase1. It is estimated that with the NFSA in force, the subsidy involved would be
in the order of Rs 75,000 crores.
2.2.3. Currently, food is distributed primarily through the Public Distribution System
(PDS) and supplementary feeding programs such as ICDS and school mid-day meals.
The major objectives of the PDS are: a) ensuring the entitlement of basic commodities
at reasonable and affordable prices, especially to the poor; (b) maintaining stability in
the prices of essential commodities across regions and in periods of price inflation;
((c) introducing rationing during scarcity; and (d) keeping a check on private trade,
hoarding and black-marketing (Swaminathan, 2000).
2.2.4. PDS, as we know, is operated under the joint responsibility of the central and
state governments, with the former responsible for procurement, storage,
transportation (often upto the district headquarters) and bulk allocation of foodgrains.
The state governments are responsible for distributing these foodgrains to consumers
through a network of Fair Price Shops (FPS). This responsibility includes
1
A recent review of the existing buffer stocking policy in India suggests that by 2011-12, direct
demand for human consumption is likely to be 89 million tonnes of rice and 65 million tonnes of
wheat. An additional 4 million tonnes of rice and 13 million tonnes of wheat will be required to meet
other demands, including industrial requirements. The report thus estimates that by 2011-12 India will
require a minimum total buffer stock of 31 million tones, including 22 million tonnes of rice and 9
million tonnes of wheat. Of this, 16 million tonnes will be required for PDS, 6 million tonnes for
welfare schemes and 9 million tonnes as food security reserve.
8
identification of families below poverty line (BPL), issue of BPL/ration cards,
movement of foodgrains from the district headquarters to the FPSs, and supervision
and monitoring of the functioning of the Fair Price Shops.
2.2.5. With a view to improving its efficiency, the PDS was re-designed as Targeted
Public Distribution System (TDPS) with effect from June, 1997. The TPDS envisages
identifying the poor households and giving them a fixed entitlement of foodgrains at
subsidised prices. Under the TPDS, higher rates of subsidies are being given to the
poor and the poorest among the poor. The families above the poverty line (APL) are
also being given foodgrains under TPDS but with lower subsidy. There is a third
category of beneficiaries –Antyodaya card holders. Under the Antyodaya Anna
Yojana (AAY), 35 kg of foodgrains are being provided to the poorest of the poor
families at the highly subsidized rate of Rs.2 per kg. for wheat and Rs.3 per kg for
rice. The effective functioning of PDS therefore has an important bearing on the
quality of life of millions of people, particularly poor people in the country. It also has
crucial implications for implementation of the NFSA.
2.2.6. However several studies including an evaluation by Planning Commission in
2004-05 reveal a number of problems in the implementation of the PDS which targets
around 400 million people and is budgeted at around for Rs.55,000 crore annually.
The scheme, the evaluation says, is affected by targeting errors (both inclusion and
exclusion errors), spurious beneficiaries, diversion and pilferage and even location
specific availability. The next section discusses in-depth, the problems with the PDS
and why it is urgent that the system be corrected/ revamped if effective food security
is to be ensured for all citizens of India and if gross wastage of taxpayers money is to
be avoided.
2.3.
Major Deficiencies in the Public Distribution System
2.3.1. In his address to the National Development Council in December 2007 Finance
Minister Shri Chidambaram pointed out: “The next concern is the deeply flawed
distribution system”. The most recent evaluation study on the Targeted Public
Distribution System (TPDS) by the Programme Evaluation Organization has found,
inter alia, that taking into account all the inefficiencies of TPDS, Government of India
spends Rs. 3.65 to transfer Re. 1 to the poor. About 58 per cent of subsidized grains
do not reach the target group, of which a little over 36 per cent is siphoned off the
supply chain.”
2.3.2. As identified by various studies, the major deficiencies of the PDS can be
divided into problems faced on the ground in the actual nut and bolt delivery of the
scheme i.e. the micro problems, and the more macro, design or policy issues. These
are detailed below:
2.3a. Micro problems faced in delivery of scheme on the ground
2.3.3. High exclusion and inclusion errors: The Programme Evaluation
Organisation’s (PEO) Study (2005) establishes large scale exclusion and inclusion
errors in most states. High exclusion errors mean a low coverage of BPL households.
The study estimates that TPDS covers only 57 per cent BPL families. Other estimates
9
put the figure at about one-third of poor households (NCAEPR). Inefficient targeting
is because of two reasons. One is the criterion used for allocation of foodgrains by the
Central Government to states. The Central Government allocates food grains to states
based on a narrow official poverty line. There is a need to look at this allocation
criterion to states. If we go by the official poverty ratio criterion, only about 28% of
the population is eligible under PDS at all India level in 2004-05. However, various
studies show that food insecure households may be higher than the official poverty
ratios. A second problem is the use of BPL method for identifying households by the
states. The procedure is usually opaque, bureaucratic, and does not involve gram
sabhas. Also, the method of identification of beneficiaries differs from state to state.
For example, some of the South Indian states do not follow the official poverty ratio
for limiting the ration cards. This leads to high inclusion errors.
2.3.4. Leakages and Diversion: There is an urgent need to minimize leakages from
the PDS, which are estimated to be very high. As per official estimates a total of 24
million tonnes of foodgrains was lifted by PDS in 2004-05, while NSSO’s
consumption estimates indicate a total of 10.2 million tonnes, implying substantial
leakages. Looking at the loss from a financial angle, during 2003-04, out of an
estimated subsidy of Rs. 7,258 crore under TPDS, Rs. 4123 crore did not reach BPL
families. Moreover, Rs. 2579 crore did not reach any consumer but was shared by
agencies involved in the supply chain.
2.3.5. Leakages happen both on the APL and BPL allocation. It is estimated that only
20 percent of the APL households lift their ration quota and thus a part of the
entitlement of these households leaks out of the PDS supply chain (NCAEPR). Other
estimates suggest that not even half of the BPL quota reaches BPL families (PEO
2005). The intensity of leakage varies across states. For example, in Bihar and Punjab,
the total leakage exceeds 75 per cent while in Haryana and Uttar Pradesh it is between
50 and 75 per cent (PEO 2005). Ten to thirty percent of leakages take place through
ghost cards i.e. diversion of subsidised food grains to ineligible users. This implies
that food grains often find their way to the open market and there is huge exclusion of
deserving beneficiaries. Further, the cost of delivery increases. The PEO study
mentioned above estimated that for every 1 kg. that was delivered to the poor,
Government of India had to issue 2.32 kg from the Central Pool.
2.3.6. Problems with storage: FCI's covered storage capacity has remained stagnant
since March 2005, but there have been many incentives to attract private investors of
godowns. Also, FCI stores grain mainly in jute sacks; but this causes problems as the
gunny sacks are easily damaged by rodents. Pilferage too is made easier with gunny
bags. One can always say rats ate up the grain or fungus destroyed it. Problems in
storage continue at the block level wherein foodgrain storage points are usually
without electricity, computer systems or even landline phones. Records are kept
manually. Despite the high monetary value of the foodgrains stored, there is usually
only a single attendant and no security personnel. Further, these warehouses are not
equipped to weigh the food grain received from the FCI as they have weighing scales
of only 0.3 MT capacity. FPS owners thus complain of under weighing of foodgrains
made available to their shop by about 2-3 Kgs in each bag of 50 Kgs.
2.3.7. Problems with transportation: The transportation of stocks from FCI / Rice
Mills to Block Level Storage Points is called as Stage–I transportation, which is
10
usually undertaken through the district-wise private transport contractors through
tenders, and is an important source of pilferage and recycling. However, the bulk of
the pilferage happens under Stage II transportation i.e. from block level storage point
to the doorstep of the FPS. To illustrate, PDS rice is often smuggled to rice mills and
converted to cattle feed by grinding and mixing it with paddy husk; this is then sold in
the market at thrice the price. In other cases it is polished in rice mills; later these are
sold in the open market for four times the price, with the scam running into crores of
rupees.
2.3.8. Poor access to Fair Price Shops: Fair Price Shops represent the face of the
government as ration card holders transact business with FPSs once or more than once
every month. But for various reasons, these shops remain inaccessible to households,
more so to poor households. For one, villagers and urban residents often have to fetch
rations from distances beyond six kilometers. With the shop opening just two to three
days in a month, this proves to be very difficult. Two, rations not claimed by
households during a month are declared lapsed. Since poor households do not have
cash to buy 35 kg at a time, and they are not permitted to buy in installments, they
lose out on their quota. Three, there are persistent complaints about the quantity and
quality of foodgrains delivered at these shops. Irregular delivery of FPS quota is a
persistent problem as is cheating while weighing foodgrains for the consumer. Four,
independent field studies reveal that prices charged at these shops normally exceed
the official rates by about 10-14 percent. Five, there is considerable exclusion of
Dalits, migrants and the homeless. Shah et al (2006) estimate that only 17 percent of
villages have FPS shops in dalit hamlets. Nearly 70 percent of the outlets are located
in dominant caste localities where FPS dealers, more often than not, discriminate
against dalits in issuance of grains. Seasonal and temporary migrants on the other
hand face problems in receiving their entitlements during the period they are out from
the village. Therefore they often pawn their cards to money lenders who misuse them.
The plight of the homeless and poor living in unauthorised colonies in urban areas is
worse. They are denied ration cards, and are thus not able to avail of PDS, despite
being Indian citizens.
2.3.9. Poor financial viability of Fair Price Shops: As per the PEO study, only
22.7% of the FPSs were found to be earning a viable return of 12% ROI on working
capital. The financial viability of these shops appears to have been badly affected by
the exclusion of APL population from the PDS (which happened after PDS became
TPDS in 1997). The virtual exclusion of the APL population has led to a big decline
in off take. With fewer ration cards to serve, lower turnover and upper bounds on the
margins that can be charged to BPL consumers, the net profits of fair price shop
owners and dealers are lower under the TPDS than before. Since there are economies
of scale, for instance, with respect to transport, the distribution of smaller quantities is
likely to make many shops unviable. It is not surprising that transport and rental costs
constitute, on average, more than 40 percent of the operational costs of FPSs. Yet
another condition that mars the financial viability of FPS owners is that they are
required to lift their monthly quota on down payment (through DDs). When fair price
shops are economically viable, there are fewer incentives to cheat. In fact, the
Planning Commission study suggests that most of the vast network of retail outlets
maintained by the states to sell subsidised food would be unprofitable without the
diversion of grains (Planning Commission 2005).
11
2.3.10. Lack of transparency, inadequate accountability of officials implementing
the scheme and poor grievance redressal: Most fair price shops do not display
relevant prices on their Notice Boards as it saves them accountability. The selection
procedure of FPS dealers is also marred with problems, and is often based on
patronage or bribes.
2.3b. The more macro, policy issues
2.3.11. Failure to meet the Regional Allocation and Price Stabilization Objective:
Only a few states produce foodgrains and therefore distribution of foodgrains cannot
be left to market forces. The PDS therefore was designed as a tool by way of which
the government could ensure price stabilisation in the country by transferring grain
from cereal-surplus to cereal-deficit regions. Targeted PDS has reduced the
effectiveness of this objective. This is because under TPDS, the demand for cereals is
no longer determined by State Governments (based on their requirements, and in
practical terms on past utilisation) but on allocations decided by the Central
Government (based on poverty estimates prepared by the Planning Commission).
Further, allocations from GoI are valid only for a month, and if the state government
is not able to lift within that time, its quota lapses. Some poor states like Bihar and
Orissa are not able to lift their entire quota. This has implications later too as they are
not released their allocations on the ground that they did not lift the foodgrains in the
past when the market price was low.
2.3.12. Interest burden for states: States need to borrow from commercial banks to
finance their PDS operations and to ensure that the capital is kept rolling for the
shortest period. Interest cost burden of state civil supplies corporations is based on a
concessional rate of interest granted under the “food credit” from the banking system
by hypothecating the grain stock and the state government providing a guarantee. In
addition state corporations need to pay 1% market fee in respect of the allotment and
4% VAT on the economic cost of FCI. This places a significant interest burden on
states with State Food Corporations running into huge losses.
2.3.13. Multiplicity of agencies: Finally, there are a multiplicity of agencies involved
in food distribution starting from FCI, to the Central Warehousing Corporation
(CWC), State Civil Supplies Corporations, transport contractors and FP shop dealers
to deliver nearly 55 to 60 Million tonnes of food grains through more than 6 lakh FP
shops at the end point. All in all, the department itself has six wings and 3 PSUs under
it. Moreover, several acts such as the Food Corporations Act and the Warehousing
Corporations Act govern the chain of procurement, storage and distribution. The
current organizational structure of the Department of Food and Public Distribution
therefore is not amenable for pushing the reform agenda.
2.4: Strengths, Opportunities, Threats: In the foregoing analysis of the situation
faced highlighting the weaknesses in the present system we could take into account
the following strengths and opportunities while factoring in the threats outlined below
while drawing up our strategy.
12
2.4a : Strengths
We draw upon the existing infrastructure and institutional framework. We could
expand on the best practices successfully implemented in certain States.
2.4b : Opportunities
We are poised in a scenario where we could draw upon the prevailing technologies for
ICT as well as the existing structure of people’s involvement.
2.4c : Threats
We have to factor in the shortfall of supplies due to failure of monsoon and declining
productivity due to adoption of unsustainable agricultural practices. International
market fluctuations could further jeopardize our efforts to ensure availability of
supplies.
13
Chapter 3: Outline of the Strategy
Long term goals, policy solutions and key strategies
Goal 1. Restructuring and Strengthening the Department of Food and Public
Distribution
Policy Solutions/Key Strategies
-
-
The Department of Food and Public Distribution establishes a PDS Mission
The PDS Mission takes responsibilities to bring out policies in accordance with
the Strategic plan, establishes systems and mechanisms for delivering foodgrains
to the targeted households without any leakages
Mission uses consultative processes to help states prepare plans for reform and
facilitates their implementation by the states
Mission monitors performance of states and Centre as agreed in the MOUs
Result Indicators
-
Vision document outlining the structure, powers and responsibilities of the
Mission prepared
Consultative workshops held with all states towards preparation of plans
MOUs signed with all states outlining clearly the responsibilities of both states
and the central government
Improvement in performance indicators year-on-year, as tracked by an
independent third party
Goal 2. Revamping the Procurement, Storage and Distribution System
Policy Solutions/Key Strategies
-
Decentralized planning and procurement
PPPs for procrurement, storage and distribution in select, notified areas
Improved network and service delivery of Fair Price Shops
Result Indicators
-
Policy for proactively promoting decentralized procurement notified
Policy for promoting Public-Private- Partnership in procurement, storage and
transportation up to FP Shop in select areas notified
MOUs signed with all states outlining clearly the responsibilities of both states
and the central government
MOUs signed with the private agencies in select areas for procurement, storage
and transportation up to FP Shop
Improvement in performance indicators year-on-year, as tracked by an
independent third party
14
Goal 3. Developing an end-to-end ICT architecture for PDS management
Policy Solutions/Key Strategies
-
-
An integrated ICT architecture tracking procurement; storage and inventory
management; allocation; transportation; FPS functioning; licensing; beneficiary
management; and monitoring across the country
Leveraging existing learning and resources for optimal solutions
Result Indicators
-
Blue-print for end to end ICT architecture prepared and Request for Proposal
(RFP) issued
Hardware and software deployed for managing all the transactions on-line.
All transactions happen online and data that is captured from the transactions is
uploaded to the National Portal for building data base
Various MIS reports are generated from the National Portal
Improvement in performance indicators year-on-year, as tracked by an
independent third party
Goal 4. Strengthening monitoring and reviewing arrangements and
improving transparency, accountability and grievance redressal mechanisms
Policy Solutions/Key Strategies
-
-
All the decisions in the management of PDS are taken in a transparent manner and
the entire information is available in public domain
Every functionary responsible for the implementation of PDS is held accountable
to certain defined tasks and action taken in case of failure to perform the tasks
assigned
Very strong and robust grievance reddressal mechanisms are put in place
Result Indicators
-
-
The information about all the transactions in procurement, storage, transportation
and distribution is placed in public domain by capturing the data into the National
Portal
Complaints relating to dereliction of duties of the functionaries concerned are
acted upon and responsible punished without delay
Grievance redressal mechanisms in the shape of National/State/District level Food
Security Missions are established
Individual or community level grievances are acted upon expeditiously by the
institutions set up as part of grievance reddressal mechanism
Goal 5. Promoting Community Participation
Policy Solutions/Key Strategies
-
Involving communities in village level demand estimation
15
-
Involving communities in closely monitoring the functioning of FP shop
Management of Fair Price Shops by Communities and Women
Periodic conduct of social auditing of PDS by the Gram Sabhas
Empowered role of Gram Sabhas and Gram Panchayats
Result Indicators
-
Village level PDS Plans are prepared covering details such as the foodgrains to be
locally procured and foodgrains needed under PDS
FP shop level monitoring committee established
Gram sabhas are facilitated to conduct Social auditing of PDS periodically
Prioritization of Goals
Using three parameters - suitability (effectiveness and impact), feasibility (ease of
implementation) and acceptability (by stakeholders) – the different goals/strategic
initiatives can be assigned weights as follows
Goals/Strategic Initiatives
Goal. Restructuring and Strengthening dept, establishing PDS mission
Goal 2. Revamping procurement, storage and distribution
Goal 3. Developing an end-to-end- ICT architecture
Goal 4: Strengthening monitoring, review, transparency, accountability
and grievance redressal mechanisms
Goal 5. Promoting community participation
Total
Weights
25
25
20
20
10
100
16
Chapter 4: Implementation Plan
4.1. Goal 1: Restructuring and Strengthening the Department
of Food and Public Distribution in mission mode
4.1.1. PDS is the joint responsibility of the Centre and State. There are various
stakeholders, each with their own interests and capacities. To coordinate these diverse
interests and capacities like FCI, Department of Food and Civil Supplies, State
Agencies, NIC etc., a separate empowered organizational structure is required to
tackle the gigantic task of strengthening the PDS.
4.1.2. It is of relevance to note here that reform initiatives are not new to the PDS
system. There have been and are several attempts to do so, but what has been lacking
is a mission mode approach. Also of note is the lack of a strong neutral institutional
home with proven capacity to manage procurement and delivery of foodgrains.
4.1.3. We suggest establishment of a Mission within the Dept of Food and PDS to
manage PDS professionally. The following is the suggested step-by-step
implementation plan to do so:
-
-
-
-
In order to arrive at a strategic policy that can be implemented across States, it
is proposed that a Mission Director be appointed at the Centre under the
Ministry of Consumer Affairs, Food and Public Distribution at the level of an
Addl. Secretary to Govt of India, who will be assisted by three Task Forces on
Policy, Finance and Accounts and ICT architecture. The members of these
Task Forces will be drawn from relevant fields of expertise. The mission
director will also coordinate between the various task forces where necessary.
It is proposed that the mission have six wings including a) procurement,
storage, transportation; b) PDS outlets; c) ePDS; d) Capacity building; e)
Financial management; and f) Monitoring and evaluation.
As a first step, a vision document will be prepared that outlines the structure,
powers and responsibilities of the Mission clearly
As a next step, the task forces will provide specific policy inputs on various
aspects of implementation strategies, address policy gaps and prepare road
map for implementation in consultation with stakeholders in a manner that the
overall reforms in PDS are carried out within one year at the level of states
after the enabling policies/facilitating environment is created at the Centre.
For instance, a Procurement and Distribution plan, for each procurement year,
will be prepared at least 3 months in advance. Since procurement year
commences on Oct 1st of every year, the Mission will hold meetings with the
Civil Supplies Depts of each state, review the PDS functioning, assess the
likely procurement to be undertaken by FCI/on behalf of FCI, the
decentralized procurement the state wants to do and arrive at the foodgrains to
be delivered to the state to realize the rights guaranteed under the NFSA to
prioritized/general groups as well as other welfare schemes. The Mission will
accordingly prepare a detailed implementation/action plan as per the
Procurement and Distribution plan developed. This will also elaborate the role
17
-
-
-
-
to be played by other wings other than procurement (e.g. ePDS) for effective
procurement and distribution.
Similarly, the task force on ICT architecture will be responsible for design,
operations, maintenance, and ongoing updation of ICT architecture in
PDS/support to stakeholders.
The consultative processes and planning are expected to culminate in MOUs
between the centre and the state. In the MOU, a particular state may commit
certain targets under decentralized procurement, creation of storage space, and
time bound implementation of PDS reforms. On the other hand, the central
government may commit towards provision of foodgrains and finances and
that it will provide state governments, adequate credit at suitable interest rates
to manage their PDS operations. In addition, the MOUs will give details on
the performance and evaluation indicators; mechanisms for monitoring them;
and penalties if such indicators are not met. Specifically, they will include a
responsibility matrix that will give clear measurable objectives at every stage
of the process required to achieve the plan and the stakeholders involved.
While such consultative planning has been attempted before, the difference
would lie in the facilitation that the Mission will provide to the state
governments to fulfill their obligations set out in the MOU. For example, as a
part of PDS reforms, end-to-end ICT architecture is to be implemented. The
Mission would actually provide supportive guidance to the state governments
to fulfill this obligation. Similarly as a part of reform agenda, if PPP is to be
introduced for procurement and storage in certain difficult areas, the Mission
will support the State Government by giving guidelines on PPP. The capacity
building wing of the Mission will provide support to poorer states on
development of plans and also in assisting the states to promote community
participation and social auditing of PDS through appropriate institutional and
human capacity building strategies.
The following organizational structure is envisaged in this regard:
18
Mission Director
Task Force on
Policy(6 months)
 Policy on easy disbursal
to states on transparent
norms
 Policy on access to
credit to states on low
interest rates
 Policy changes for
procurement including
specifications, standards
and norms
 MSP/Commissions
 Finalise modes of
creating a unified
national database of
beneficiaries
 Identify role of centre
and states in
implementation
 Suggest PPP
partnerships for various
segments of the policy
 Identify criteria for PPP
Task Force on
Finance & Accounts
(3 months)
 Policy architecture on
implementation of
direct transfer of funds
for MSP/Commissions;
 Methodologies for
payment to other
institutions like
Railways, transport
agencies, owners of FPS
etc
 Identification of all
processes in regard to
the above
 Coordination with
Banks and Financial
Institutions with regard
to payment interface
Task Force on ICT
Architecture (one year)
 Study of the existing
systems both at FCI and
in various States like
Tamil Nadu,
Chattisgarh, Haryana,
AP .
 Recommending ICT
solutions to capture
beneficiary database
and eliminate
bogus/duplicate cards
 Recommending ICT
Architecture for the
new policy and
modules for
procurement, allocation
and distribution that
could be customized as
per state needs in
consonance with CSC &
other IT policy of GOI
 Recommending clear
guidelines for
connectivity to remote
areas
 Recommend overall
ICT infrastructure for
the Centre and the
States
 Provide estimates for
implementation

19
4.2. Goal 2: Revamping the Procurement, Storage and Distribution
System
4.2.a. Decentralized planning and procurement
4.2.1.Wherever possible, PDS grain should be procured within the state where it is
distributed. The Central Government should ensure that adequate incentives are in
place for this purpose. In the long run, efforts should be made to procure, store and
distribute foodgrain in a manner as to minimize transportation costs and losses. The
government should open procurement centres within a radius of 10 kms wherever
feasible and provide on spot payment by cheques to farmers. This will minimize
intermediaries and lead to cash transfer into rural economy and boost food grain
production.
4.2.2.The first step to effective decentralized procurement is a bottom-up planning
process at the district, division, region, state and national levels. This paper suggests
that food security needs, demand-supply gaps and thus procurement needs be drawn
up first at the Gram Panchayat level and these be aggregated upwards at the block,
district, state, regional and finally the national level with suitable templates. Table 4.1
provides one such template to develop an estimation of produce that is available for
procurement for PDS and other food nutrition related programme. The items in italics
can be integrated into an expanded food basket in phased manner. Milk, fruits, eggs
could be considered for MDM and ICDS wherever feasible for supplementary
nutrition.
4.2.3.Table 4.1 would give information on planning of logistics with certain key
principles:
 Maximum procurement and consumption at local level
 Estimation of demand and supply gap of food commodities
 Minimum transportation distance (eg. each district /division /region to try and
meet demand from nearest surplus location wherever feasible)
 Preference for local varieties as per dietary habits
4.2.4.Such database is a must irrespective of whether it is the State or private agencies
that are engaged in procurement, storage and distribution. This is important both from
the viewpoint of food security as well as to bring in efficiencies in operations by
reducing costs, estimation of demand and supply gaps (both deficit and surplus areas)
and planning for storage infrastructure and transportation. Such information will also
help stabilize prices and check inflationary pressures and market aberrations.
20
Table 4.1: Food Grid at GP level for food security plan (Bottom Up
Approach)
Name of Village---
Food baskets / Local
Production
A. Total Production
B. Self Consumption at
household level
(household, seeds, cattlefeed etc)
C. Total Available
Marketable Surplus
(A-B)
D. Total Requirement for
PDS,MDM & ICDS
E. Requirement Deficit
(D-C)
Name of Block------
Wheat Paddy Coarse Millets
(subcolumns for
types .e.g jowar,
soyabean, sorghum
etc)
Distict------------
Pulses Edible Milk Eggs Fruits
Oil
etc
4.2.b. PPPs for Procurement, Storage and Distribution in select areas
4.2.4. Effective management of foodgrains, which is a pre-requisite for a wellgoverned PDS, has been beset with problems and weaknesses in the supply chain.
First, intermediaries enjoy a big "take-out" in the form of margins and commissions,
which ideally should benefit the farmers, which in turn will result in increased
production. Second, a significant proportion of grains are wasted due to bad or
improper handling and storage, pest infestation, loss of quality owing to moisture,
poor logistics, and inadequate storage and transportation infrastructure. Third, postharvest losses amount to as much as 30 per cent in India. Fourth, lack of access to
quality information and inputs too hamper production. Many of these deficiencies
pointed out above, even if reduced marginally, are bound to result in greater income
level to farmers, better governance of PDS and higher food security in the country.
4.2.6. Decentralized procurement can help reduce to a significant extent the gaps
between demand and supply. Community grain banks and fair price shops run by
communities or self-help groups of women can also help reduce leakages in storage
and distribution. However, where the ratio between agricultural production and
procurement needs is on the lower side, such areas may be notified and private
partnership encouraged along with state led interventions. These can help enhance
efficiency and accountability in procurement, storage and distribution of foodgrains
upto the last mile delivery at Fair Price Shops or what can be called as F2F – Field to
Fair Price Shops.
4.2.7. The model followed can either be open-ended wherein the same agency
services all aspects of the value chain or wherein different players/vendors service
each component separately. While delivery upto FPS is envisaged, household delivery
21
is also feasible, as is being done in 2000 villages of Maharashtra. Area specific
approach is preferred. It is also envisaged that private players can provide agriextension services while accessing institutional knowledge and support available with
the governments.
Procurement
4.2.7. Presently, the objectives of procurement by the Government are:
 To ensure that farmers get remunerative prices for their produce and do not
have to resort to distress sale.
 To service the Targeted Public Distribution System (TPDS) and other welfare
schemes of the Government so that subsidised foodgrains are supplied to the
poor and needy.
 To build up buffer stocks of foodgrains to ensure foodgrain security.
To achieve the above, the central
government extends price support to
paddy, coarse grains and wheat through
the FCI and State Agencies. All the
foodgrains conforming to the prescribed
specifications are offered for sale at
specified centers and are bought by the
public procurement agencies at the
Minimum Support Price (MSP). The
producers have the option to sell their
produce to FCI/State Agencies at MSP or in the open market as is advantageous to
them. Foodgrains procured by the State Governments and their agencies are
ultimately taken over by the FCI for distribution through out the country.
4.2.8. Under the PPP model, it is envisaged that private players will set up
procurement centres within 8-10 kms radius (norms to be fixed as per crop intensity)
and will ensure instant payment by cheque/ bank transfer (MSP guaranteed). The
requirement for stock will be estimated based on demand and supply gaps identified
by the bottom up approach as described above. Ideally, the outcomes expected from
the player are:









To open procurement centres in near vicinity (as per area)
Give information to farmers on availability of fertilizers and other inputs
Advise farmers on best yield and best farming practices – this can be done
through local village camps or over local cable channels or through mobile.
Provide farmers with access to soil testings and other related information
including weather, plant diseases, pests, etc. This can be done over SMS to
registered farmers.
Procure directly from farmers using electronic weighing scales
Assist farmers pre-harvest and ensure quality of foodgrains post-harvest at the
time of procurement
Make instant payment to producers
Feed operational information into centralized software/update MIS
Ensure transparency of operations and availability of information to public at
all times.
22
Storage
4.2.9. In India, about 70% of farm produce is stored by
farmers for their own consumption. Farmers store grain
in bulk, using different types of storage structures made
from locally available materials. The pre-treatment
necessary for better storage life is cleaning and drying
of the grain, but storage structure design and its
construction also play
a vital role in reducing
or increasing the losses during storage. Storage
losses constitute a major share of food grain loss in
postproduction operations. Various home-grown
models are already available both for storage and for
drying foodgrains for quality control. However
farmers either lack the money to make the requisite investment or lack awareness
about such models. Lack of initiatives on the part of small and medium farmers to
increase their local storage capacity results in over dependence on FCI. Currently, the
state-run Food Corporation of India (FCI) and the Central Warehousing Corp (CWC)
have together a capacity to store 87 million tonnes of grain. The CWC has 487
warehouses with a capacity of 10.6 million, while the FCI, with 1,500 godowns,
accounts for the rest.
4.2.10. Setting up a community drying-cum-storage
complex has great potential as it will help to reduce
losses and will help provide a better return for the
grower. Private players can facilitate this by
building storage capacity at block level with a
minimum of 3 months buffer. To do so, they may be
given the option of building their own or using
available infrastructure to be upgraded by them later (terms and conditions dependent
on business viability, terrain, distance from procurement centre to storage point, land
/construction costs, nature of commodity etc). The government on its part can provide
incentives to private players to develop such scientific storage infrastructure on
BOOT basis. Storage requirements can be estimated by obtaining real time estimates
of the production capacity of beneficiaries. In addition, the private sector can help
development of grain hubs at every 100-200 kms and exchange information between
the hubs, which can eventually transform into a national 'Agrigrid'. To implement all
these measures, Service Level Agreements (SLAs) can be entered with vendors to
minimize storage loss. SLAs would cover areas such as following of scientific
practice in storage, inventory management, maintaining real time data base on a
central server etc.
4.2.11. For easy movement of foodgrain, state governments may identify sites for
regional hubs (Eastern, western, Northern Sothern, Central and NE ) where bulk
storage for intra and inter state movement of foodgrain can be done.
23
Distribution
4.2.12. Private players can be used to move foodgrains from storage godowns to FPS
outlet/ beneficiary household as per demand and stock position as reflected in the
MIS. They can also help facilitate establishment of ICT system as per standards
prescribed and can help lay IT connectivity in remote areas of a State. Yet another
area where the private sector may serve as a service partner can be in maintenance of
handheld devices and readers at FPS outlets.
4.2.13. Railways could be a major public partner in the exercise of transporting
foodgrains between States and districts and ultramodern storages could be identified
or built around such rail hubs. The private sector can also give a lending hand in this
initiative through the 'own your wagon' model with Railways. This way, actual
logistics can be networked and foodgrains moved between various bulk storage areas
through an ICT based system.
Who should be the partners?
4.2.14. Given the fact that most farmers or producers expect timely payment,
accessibility to procurement centres and farm gate pickup, care should be exercised
during the selection of private partners. They –
a.
b.
Should NOT be a trading Company
Should NOT have substantial private individual owned ownership
structure; preferably should be institutionally owned with substantial public
sector equity
c.
Should have performed similar services for at least 3 years; so that one
avoids fly by night operators
d.
Should have substantial net worth – suggested net worth of at least Rs.
50 crore
24
e.
f.
g.
h.
Should have a pan India presence including in remote rural areas.
Should have had past experience of procuring directly from farmers.
Should have reputation, credibility and integrity in the market.
Selection should NOT be based on “least cost”/tender. Agencies who
fulfill criteria should be empanelled as approved procurement agencies who
can be awarded procurement for identified areas based on pre-defined fixed
incidentals which are 5-10% less than that provided to government
agencies.
i.
Agencies should be provided medium term contracts for 3 years or
more, so that they can set up the required infrastructure and manpower
without fear that the Government will terminate the contracts after one
season
4.2.c. Improving the network and service delivery of Fair Price Shops
4.2.15. Fair Price Shops represent the final face of the government in the food
distribution chain with the ration card holders transacting with FP shop once or more
than once every month. It is therefore critical that their network and delivery systems
be improved and their services be of the highest quality. The following steps can be
taken as a part of the reform agenda of FPS outlets:









All entitlements under the PDS should be made accessible by the entitlementholder anywhere in the country, at a shop of their choice, irrespective of their
place of origin.
There must be one shop every two km or a strict adherence to the current GOI
norm of 1 shop for every 2000 persons with a priority to open new FPS in dalit
hamlets
In remote villages (especially tribal areas) mobile vans need to be deployed
The Fair Price Shops must be mandatorily open six days a week
In rural areas, full monthly quota of foodgrains for distribution must reach the
retail outlets within the first seven days of the month. In urban areas, where
FPS may have lesser storage space, the quota can be delivered in 2-3
installments
Each FPS must be provided at all times with 5% additional stock based on an
end-to-end integrated computerised inventory management
All states must ensure doorstep delivery including loading/unloading to FPS in
the presense of PRI members.
Beneficiaries should be allowed to accumulate unclaimed rations from FPSs
for at least one year.
To make Fair Price Shops financially viable, FPS level margins need to be
uniformly fixed at a given proportion of economic cost. Also, all states must as
far as possible build new FPSs in community/ public buildings or make
specific provisions for rental expenditure. They must also provide interest free
loans and seed capital for new FPSs. Yet another idea to increase financial
viability of FPSs is to allow them to sell grocery items in addition to PDS
items.
25
4.3. Goal 3: Developing an end to end ICT architecture for PDS
management
4.3.1. The case for using Information and Communication Technology (ICT) to
enhance productivity and capacity in almost all areas of governance is fairly well
established. Since the PDS system is a classic example of a complex supply chain
management issue, the need for ICT is further established, as ICT has shown vast
improvements in supply chain management in similar processes, both in the private
sector as well as other public domain processes.
4.3.2. Given below is a table which lists out the key challenges in PDS and
recommends possible ICT interventions that can positively impact on the functioning
of the system as well as improve the processes within the PDS. It also lists the current
initiatives undertaken by several states to strengthen PDS. All of these show that: (a)
states are keen to improve and strengthen PDS; (b) ICT has a definite role to play and
can improve PDS.
Key Process
Procurement
Challenge
Scale
Coordination
Information
Availability
Storage & Inventory Multiple Parties
ICT Intervention
An integrated ICT architecture for
tracking procurement across the
country.
A core banking payment system to
ensure payments to farmers and
millers
Integrated
ICT
architecture
ensuring data that is available to all
stakeholders regarding current
procurement
levels
and
requirements.
Networked system to ensure there
is coordination between FCI, State
agencies and other bodies involved
in procurement.
Above infrastructure will ensure
that information is available for
decision making at all levels
through a centralized MIS. The
MIS will provide information on
 Procurement sources and their
capacity
 Procurement sources master
data along with bank account
information
 Integrated demand, offtake and
procurement
capacity
information to match demand
with procurement planning.
RFID/barcode tagged bags with
26
Management
Storage Losses
Inventory
management
Allocation
Transportation
&
clear
directions
on
stock
management as per specific stock
item.
Integrated ICT architecture to
ensure that all parties have
adequate information and plan for
storage, link stock availability with
distribution,
requisition
and
allocation.
Tagged bags to follow FIFO
method to improve inventory
maintenance.
Automatic weighing machines
linked
to
integrated
ICT
architecture and POS systems to
track stock levels across the supply
chain
Implementation of FIFO through
ICT system to avoid long storage
periods.
RFID/barcode tagged bags to be
tracked through the supply chain to
prevent leakage or diversion.
Integrated ICT architecture to link
information
from
inventory,
distribution
and
smartcards
modules to automate allocation
alerts.
As above.
Linking allocation to
consumption
and
stock levels.
Reducing allocation
cycle time.
Information
Consolidation
Transportation Loss
Electronic Weigh Bridges to be
installed at all loading points,
where possible with computer
generated truck chits/movement
challans and weight check memos
GPS tracking of trucks to ensure
non-diversion of commodities.
Web-enabled tightly monitored
route charts to track the movement
from the warehouses to the FPS
with details of commodities carried
and identity/contact of the truck
driver/attendant.
SMS alerts to be sent to citizens on
truck movements
Lack of Information
Data from above to be integrated
into ICT system to pull out
information as and when required.
Timely Delivery
GPS tracking linked to webenabled
information
systems;
27
FPS Functioning
Allocations
Finance
Operations
Licensing
Management of FPSs
Beneficiary
Management
Identification
timely information will lead to
timely delivery.
Allocation to the FPS shall be done
online on basis of card holders and
its stock position
Core banking linked payment
facility to FPS owners. Integrated
software that links payment to
requisition
and
allocation
information coupled with SMS
alerts to FPS owners, allocation
authorities and godowns.
Automatic credit rating of FPS
owners on predesigned operational
parameters.
Online requisition from FPS and
transparent allotment.
SMS alerts to FPS owners on stock
receipt at state godowns.
Robust POS terminals to send time
of opening of shops to central
server.
Each FPS to be provided with an
automatic
weighing
machine
connected to a POS biometric
reader+billing machine (both with
voice-enabled features in the local
language) to ensure compatibility
between the quantity provided and
recorded
Automated inventory balance and
stock balance.
All transactions at FPS to be stored
on FPS owner’s smart card.
Smart card based licenses to store
information of FPS.
Digitization of ration cards and
common database of beneficiaries
linked to smart card information
and biometrics.
Convergence of biometrics and
beneficiary database with UID
database to filter bogus and
duplicate beneficiaries.
Possible portability of smart card
across FPS once UID based
identification is in place.
Online application and issue of
ration cards.
28
Off-take recording
Monitoring
Grievance Mechanism
POS machines at FPS (voice
enabled) to automatically input data
into beneficiary smart card as well
as FPS smart card.
Smartcards as records of off-take,
Integrated ICT architecture to
upload all off take into a central
server for online consolidation and
availability of data to decision
makers.
All POS machines to have long
battery life given harsh conditions
in FPS
Online/telephonic
grievance
redressal mechanism that provides
acknowledgment
Deployment of solution through
CSCs, call centres and SMS
Central call centre linked to
integrated ICT architecture so that
caller
can
get
immediate
information regarding grievance
Common web-enabled MIS Portal
that
provides
drill
down
information and reports on key
performance parameters, accessible
to public at large.
An indicative list of MIS reports
can include: procurement centre
wise foodgrains procured, storage
godown wise foodgrains stored,
foodgrains transported to FP shops,
household
wise
foodgrains
distributed at FP shop level.
Current Initiatives
Item
States
Computerization of TPDS operations FCI Pilot in 3 Districts each of Andhra
to Block level Godowns.
Pradesh, Assam, Chattisgarh & Delhi.
Computerization of ration card related 10 states have reported taking up data
database.
digitization
Smart card based delivery to ration card Pilot project in Haryana and Chandigarh
holders
GPS based tracking vehicles transporting Tamil Nadu, Delhi, and Chattisgarh.
TPDS commodities
4.3.3. The Food Corporation of India has partially implemented an Integrated
Information System for Foodgrains Management (IISFM). Apart from this there is
partial computerization of varying degrees of various parts of the TPDS cycle in
almost all the states.
29
Annexure 1 discusses different initiatives taken by various State Governments in
strengthening PDS through ICT intervention. These initiatives indicate the relevance
and need for technology in PDS delivery, but also demonstrate a disaggregate
approach to use of technology and resultant sub-optimal approach to performance
management.
4.3.4. Core principles of ICT application: The Wadhwa Committee Report had made
various recommendations regarding strengthening of PDS. The Central government
(including FCI) as well as various State Governments have taken various measures to
revitalize PDS and remove its ills. Many of these measures involve ICT as both a
strengthening mechanism as well as a tool for taking corrective action. However,
when undertaking an egovernance initiative of this magnitude, it is imperative to keep
in mind certain core principles of ICT application in order to ensure appropriate
results. It is felt that these core principles are worth reiterating in the present context.
(a) End-to-End transaction-based solution framework: ICT solutions must be endto-end solutions in order to be effective. This means not only that the solution
encompasses the whole cycle – from procurement to delivery to beneficiary,
but also that it is uniform, in terms of software architecture for core processes /
information across states. The solution also needs to be transaction based in
the sense that it must involve no or extremely limited opportunity for off line
transaction entry. The software therefore needs to provide for a single time
entry of transactions at its origin to ensure that data entry is not duplicated and
data integrity is protected across processes and actors. Such an end-to-end
system enables:
 A full audit trail, which makes it easier to pinpoint weaknesses in the
system, since all the parts are connected to the whole. A delivery from a
taluka godown needs to reach the FPS. A cross check between the godown
and the FPS requires an integrated system where both the FPS and the
godown data is on the same application.
 Meaningful and effective MIS as an integrated transaction based solution
allows for minimal manual intervention, thus providing for integrity of
data as well as completeness of data
 Minimal transaction costs for procuring and managing software solutions.
Further such a system also enables states with capacity constraints to
benefit from a common platform for program and performance
management.
 Importantly, a common solution framework coupled with common
technology standards for key components (such as POS, smartcards,
biometrics, data interchange standards etc. many of which are now
possible in the country) can help in interoperability across states and
provide portability of services for the beneficiary, during migration or
other circumstances.
30
(b) Deployment of key technologies that enable last mile service delivery:
Specific advances and developments in technology and their deployment
across the world and our country (as evidenced by current initiatives) provide
examples of technology that enable strengthening last mile service delivery as
well as monitoring of the same. These include –
 Multi-purpose Smartcard Technology – which serves as a tool for
identification of beneficiaries through photos and storage of biometric data
(as well as PIN options). Smart cards serve as record keeping devices that
can store details of transactions related to the beneficiary for cross validation.
Further they provide a mechanism for offline service delivery (in the event of
connectivity constraints). Smartcards also have the capacity to serve multiple
applications across different sectors. Very importantly, smartcards can be a
means to protect privacy of information pertaining to the beneficiary, if so
desired. However, multiple proliferation of the cards for different services of
the government mitigate against efficiency apart from inconveniencing the
citizen. There is also scope to review the utility of such cards, given the
growing connectivity capacity in the country and juxtaposing their relevance
with disaster situations and privacy concerns.
 Biometric technology – that facilitates verification and authentication of
beneficiaries. This in turn helps in ensuring that the benefits reach the right
person and also helps (through authentication systems) linked to a common
database to continually track and eliminate duplicate beneficiary records
 Point of Sale Equipment – The Point of Sale equipment proposed for the Pilot
could be a Hand Held Recorder or a mobile device with biometric
attachments, printers and connectivity devices. Technological advances have
made availability of such devices that are handy, portable, and can store large
amount of data and at the same time provide cost effective options. The easy
availability of such devices coupled with mobile connectivity options help
extending the reach of technology and alternate service delivery systems.
 Other technology applications – such as GPS, mobile technologies, barcoding
and RFID are all under proven use, especially in the private sector across the
globe and form an integral part of supply chain management.
(c) Making the architecture beneficiary centric: Time and again we need to
remind ourselves that ultimately the purpose of reform is to reach the right
amount of foodgrans, at the right time, to the right person. The idea of a
beneficiary centric solution implies that the performance parameters and
outputs expected of the ICT initiatives result in measurable improvement, not
only in the process where they are applied, but also in the ultimate goal of
providing benefit to the ultimate user of the system - the BPL family. Efforts
to improve procurement, storage, transportation, licensing and finance, are
ultimately meaningless if they do not result in better measurable service to the
beneficiary. Thus, an integrated system, with a focus on the beneficiary, and
deployed by an authority whose interests are above the interests of the process
they own, is the only way to use and implement ICT to strengthen PDS.
(d) Cash transfer system in lieu of distribution of foodgrains: The single most
reason that accounts for massive leakages from PDS is the current system of
transporting highly subsidized foodgrains through long distances. There is
huge incentive for diversion of stocks before they reach FP shops. In order to
deal with this challenge, it is possible to keep the prices of foodgrains at
31
market price, but go for transfer of differential cost as subsidy directly in to
the account of the beneficiary households. This idea can be piloted in a few
districts in the country and later depending on the experiences from ground,
can be replicated across the country. The pilot districts should go in for
issuance of smart cards to all the beneficiary households with the biometric
data of all the households encrypted in the chip embedded into the smart card.
The beneficiary households shall also be given a bank account. FP shop
licenses in the pilot districts can be issued for more than one dealer. The FP
shop dealers are expected to own a ‘Point of Sale Terminal’ which is
connected to the Bank’s server through GPRS. As when the beneficiary
household swipes the card at the ‘Point of Sale Terminal’ the beneficiary
account gets updated and the beneficiary can transfer the amount into the
account of the shop keeper.
This arrangement will have the following
advantages
a. There is no incentive for the FP shop dealers to divert the foodgrains
as the foodgrains are secured by him/her at market price and are to be
sold at market price
b. In this system, since there could any number of licensed FP shops in
the village, the card holder will have choice of going to any licensed
FP shop in the village or outside the village, and buy the foodgrains at
market price, but pay to the shop keeper the subsidized price and also
electronically transfer the subsidy from his account to the account of
the shop keeper by swiping the card at the ‘Point of Sale Terminal’.
c. This system would enable the beneficiaries to draw their rations from
any shop in the country. Such portability of entitlements would make
significant difference to the migrant workers in our country.
4.3.5. Leveraging existing learning and resources for optimal solutions:
Convergence is recommended as a key guiding principle and needs to play a critical
part in the conceptual framework to optimize costs, both financial and administrative
and also to provide a seamless, empowering experience to citizens. There is a need to
leverage resources in the form of smartcards, biometric databases, registration
systems for beneficiaries as well as application systems of other stakeholders such as
banks, transport companies, weighment centres to link up resources as well as
information.
4.3.6. Beyond ICT: As is well understood, ICT cannot be a panacea to all evils. ICT
interventions are not entirely effective due to constraints which have a non ICT
solution. In the PDS system there are many processes which require non ICT
interventions to strengthen the supply chain. These non -ICT interventions are also
critical to ensure that the other ICT interventions are successful as they are all
interlinked in the supply chain. What ICT can do in turn is to provide indications of
problem areas which can then be used to design business process solutions that may
not be related to technology alone. A few important non-ICT interventions are:
a) Ensuring financial viability of FPS. Studies show that only 23% of FPS are
financially viable. Some states like Kerala have tried to strengthen them by
allowing them to stock and sell non PDS items. Other states are looking at
providing them with credit. Institutional measures like providing them with
32
minimum stocks without waiting for regular monthly allocation, ensuring that
PDS commodities are transported to them, and allowing them to pay in a
consolidated fashion through online banking will ensure that the FPS are
strengthened.
b) A few states are also looking at strengthening the FPS by giving licenses to
cooperatives. Chattisgarh is implementing a ‘deprivatization’ in this manner
and in Tamil Nadu this has been met with a fair amount of success.
c) At the storage level, both at FCI and the state godowns, the architecture and
technology relating to storage can be improved in terms of providing better
ramps for loading/unloading, providing improved storage platforms, and better
design of godowns.
d) Policy measures need to be taken regarding transportation. In Chattisgarh,
private transporters at the state level have been removed and the Food and
Civil Supplies Department is managing transportation from state godowns to
the FPS.
4.4. Goal 4: Strengthening monitoring and reviewing arrangements,
and improving transparency, accountability and grievance redressal
mechanisms
4.4.1.Internal monitoring and review is critical to the successful implementation of
any strategy. To do so, we propose first the creation of institutional arrangements at
the mission, state and district level, which can progressively track and monitor
progress of plans against indicated milestones.
4.4.2. At the mission level, quarterly reviews of state performance against MOUs
should be undertaken by a Prime Minister Committee under the chairmanship of the
Minister of Food and Civil Supplies. Likewise, at the level of individual states,
steering committees should be set up under the chairmanship of the Chief Secretary.
These committees should be mandated with the responsibility of undertaking
quarterly reviews of district level procurement, storage and distribution plans,
milestones set for decentralized procurement, ePDS, improving transparency and
accountability and community participation etc. Similarly, district level committees
under the District Collector should undertake quarterly review of the performance of
districts.
4.4.3. Simultaneously, efforts should be made to improve transparency, accountability
and grievance redressal as related to the PDS on the ground. The working draft of the
NFS bill proposes several steps to do so. Once implemented, it is envisaged that they
would go a long way in reforming the PDS into a more open and receptive food
distribution system for common citizens. These steps include:

Transparency measures: The first step in improving transparency around the
PDS is to create awareness among beneficiaries on their rights, entitlements,
prices, availability of essential items etc. This can be done through awareness
campaigns designed in collaboration with the civil society that outline, clearly
and simply, all these and the process and level of mandatory disclosure by all
agencies in the supply chain. It is also proposed that a system of uniquely
33





numbered food coupons be initiated by each state government to track the
distribution of grain to cardholders. These food coupons (booklets of monthly
coupons for at least one year) can be printed in the ration card. In the event
where coupons are replaced with Smart Cards or similar devices, they will not
replace the printed ration cards. In addition, to create more transparency, it is
suggested that each FPS a list of cardholders and their category, along with
price list per unit of PDS commodity and available stock. Also, all households
should be allowed the right for immediate and open inspection of records. In
case households demand information regarding the functioning of the FPS, it
should be made available to them within 15 days of application (over and
above RTI) at a cost no more than the cost of photocopying. So that this
measure is strictly enforced, violation of provisions of proactive disclosure of
information should attract strict penalties.
New design of and entries in ration cards: The draft NFS bill proposes that
every ration card should include a clear “entitlements page”, written in simple
words in the local language, with details of PDS entitlements as well as
helpline numbers and grievance redressal facilities. It is also proposed that the
manager of each Fair Price Shop be held responsible for ensuring that details
of food transactions including date, time, quantity, price etc are promptly
entered in the ration cards of the recipients, in legible writing, along with the
manager’s signature.
Tamper-proof and people-friendly receipts: It is proposed that each Fair Price
Shop be equipped with a device to generate tamper-proof records of food
transactions along with receipts that can be understood and approved by the
card holders.
Community and state monitoring: It is understood that transparency measures
will come to naught in the absence of strict monitoring. Therefore it is
proposed that extensive facilities be put in place to promote community
monitoring of Fair Price Shops, including Helplines, SMS alerts, social audits,
and Vigilance Committees. Particularly, the draft bill suggests that every Fair
Price Shop have a Vigilance Committee of 5 members, of which at least 3
members be women, and a majority be PDS card holders attached to that Fair
Price Shop. It is critical here that the Vigilance Committee does not include
anyone involved in the management of the Fair Price Shop. In addition, FPSs
may be selected randomly and regularly for inspection by inspectors and
flying squads (from other districts). Raids and seizures too need to be a
regular feature of the monitoring mechanism.
Social audits: As part of community monitoring efforts, it is proposed that a
social audit of each Fair Price Shop be conducted at least once a year at the
Gram Sabha. It is proposed that the audit include reading aloud in public of a
summary of transactions at FPSs in the previous 12 months.
Strengthening grievance redressal: The draft NFS bill proposes the following
measures to strengthen grievance redressal:
a) Appointment of a sub-district level grievance redressal officer by the
Department of Food; on failing to achieve redress, people can access
independent District Grievance Redressal Officer, who will have the power to
redress as well as to award fines and compensations.
34
b) District Grievance Redressal Officer may be appointed by the UPSC and by
lateral entry from a wide range of applications, with a tenured deputation of 5
years extendable
c) Any household that is vulnerable and eligible for a ration card but doesn’t
have one can apply to the District Collector’s office, with an oral or written
application. Investigations to be held within a time frame (15 days max) to
determine whether the household is eligible; and a ration card to be provided
within one month of conducting the enquiry irrespective of whether there is
quota available for the same.
d) PDS Lok Adalat on the lines of Bijli/Telephone Adalats can be formed to
redress the grievances of the beneficiaries on the spot
e) Public Distribution System (Control) Order 2001, amended in 2004 and
appropriate criminal procedures can be used to impose penalties.
f) Duty to fine when violations occur; compensations three times the cash value
of the loss; fines to be charged at the level at which the violations were caused,
list of violations being as follows: failure to keep fair price shop open during
opening hours (except in cases of prior, written notice or permissible leave);
refusing monthly entitlements to any household despite stock being available;
failure to provide all eligible individuals PDS entitlements; deliberately
excluding any household otherwise eligible for ration; including
household/giving ration card to household otherwise not eligible; failure to
display at all fair price shops/local body buildings list of all card holders in the
area; failure to let persons, who so desire, inspect records of fair price shops;
failure to conduct open,, transparent and inclusive social audits around PDS;
failure to act upon findings of the social audit so conducted; failure to act on
complaints to redress grievances
4.5. Goal 5: Promoting Community Participation
4.5.1. Currently participation of the local community in the Public Distribution
System is very weak. It is not because the primary stakeholders don’t value their
participation in the management of the PDS. It is because nowhere, such an
environment for their participation is facilitated by the Government. This is in
contrast to the growing recognition to the value of community participation in
schemes that are intended to benefit the poor, whether it is MGNREGA, Watershed
development, community lead sanitation program, education or health. Community
participation is not fostered in PDS, because the department of civil supplies that
manages PDS in most of the states in the country perceives itself as a regulatory
agency, with no skills or conviction on community mobilization and participation.
The quality of delivery of services in PDS can be significantly enhanced if
community participation is fostered. Community participation does not happen unless
supportive environment is in place. Following are the elements of supportive
environment for fostering community participation:
a)
Areas for community participation: We strongly recommend participation of the
BPL card holders in the preparation on annual PDS plans at the village level,
monitoring of the functioning of FP shop at village level, by periodically inspecting
the FP shop level registers and in the conduct of Quarterly Social Auditing of PDS in
the village.
35
b)
Institutional support to foster community participation: Self Help Groups of
Women and their federations at the village level are the most suitable community
based organizations at the village level to exert pressure on the FP shops to function
as per the norms.
c)
Human capacity building: The leaders of the SHGs should be trained
periodically, as community resource persons on monitoring the functioning of FP
shops and in the conduct of Social Audits. The State government should draw an
annual capacity building plan and ensure that the community resource persons are
trained periodically.
4.5.2 Social Auditing of FP shops: Social Auditing is a community driven process
where well trained and literate community members are empowered by the Gram
Sabha to conduct auditing on the functioning of FP shop, by interacting with the card
holders and verification of the stocks and records maintained at the FP shop. The
findings of the social auditing are to be placed before Gram Sabha for discussion and
decision. The decisions taken in the Gram Sabha, in case of any irregularities are to
reported to Block/Taluk level functionaries of Civil supplies department for taking
action. The decisions of the Gram Sabha are binding on the department and the
department is expected to take follow up action expeditiously.
4.5.3 Management of Fair Price Shops by communities and women: We propose
that while distributing licenses for Fair Price Shops, preference be given to
community institutions or public bodies such as Gram Panchayats, Self-Help Groups,
Cooperatives, etc. (in state led models). It is also proposed that Fair Price Shops be
managed by women or women’s collectives. If these measures come into effect, it
will be a landmark change from the existing system of distribution of licenses based
on patronage.
4.5.4. Empowered role of Gram Panchayats and Gram Sabhas: The Gram
Panchayats should be empowered to exercise close monitoring on the functioning of
the FP shop(s) in their jurisdiction. Grievances from the cardholders, if any, should be
received by the Gram Panchayat and follow up action to redress the grievance of the
card holders should be taken by the Gram Panchayat.
4.5.5: Grain Bank: The Dept is already implementing a scheme called Grain bank
scheme in the tribal areas. The scheme provides food security to the tribals by
providing for procurement and storage of foodgrains produced by the tribals, in their
habitations, so that same grains can be made available for PDS targeting the tribals.
The scheme is working well in such areas where adequate attention has been paid for
community mobilizatio. The dept should invest on building the capacities of the tri
bals, particularly, the women in effectively managing the Grain bank scheme.
36
Chapter 5: Linkages between Strategic plan and RFD
The RFD of the Dept of Food and Public Distribution has enlisted the following as
their Mission, Objectives and Functions.
Mission
1. Management of the food economy of the country through efficient procurement,
storage and distribution of foodgrains (cereals).
2. Ensuring availability of foodgrains, sugar and edible oils through appropriate
policy instruments.
3. Making foodgrains accessible at reasonable prices, especially to the weaker and
vulnerable sections of the society
Objectives
1. Procurement of wheat, rice /paddy and coarse grains for Central Pool under Price
Support operations
2. Enactment of the National Food Security Act
3. Ensure availability of wheat and rice to meet requirement of TPDS and other
welfare schemes and of sugar for BPL families.
4. To implement TPDS jointly with States and UTs
5. Review of sugar sector Policies with a view to reforms
6. Development/promotion of sugar industry.
7. Development of Warehousing Sector
Functions
1. Formulation and implementation of national policies relating to procurement,
movement, storage and distribution of foodgrains (cereals) through FCI & State
Govts.
2. Implementation of the Public Distribution System with special focus on the poor;
3. Provision of storage facilities for the maintenance of central pool stocks of
foodgrains(cereals) and promotion of scientific storage;
4. Formulation of national policies relating to buffer stocking, quality control and
specifications of foodgrains(cereals);
5. Administration of food subsidies relating to rice, wheat, coarse grains and sugar;
The Strategic document prepared by us clearly articulates the nuts and bolts of the
strategy to be followed by the Department as far as Public distribution system is
considered. The Strategy articulated by us is implementable as it is based on isolated
and dispersed success stories captured from across the country. We have presented an
integrated framework for action. The financial resources needed for implementing
our strategy are meager considering the annual investment of around Rs 75,000 crores
that go into Public distribution system. In view of this we feel that our strategic plan is
completely aligned with the Dept’s RFD, but give much clearer and unambiguous
approach to realize the objectives detailed in the RFD.
Since the Government of India is committed to bring out National Food Security Act
very shortly, it is our endeavour that PDS starts functioning with highest quality and
efficiency from day, once the National Food Security Act becomes effective.
Therefore it is our considered view that all the proposed actions in our strategic plan
document merit highest priority .
37
Chapter 6: Cross departmental and cross functional issues
6.1 Successful functioning of PDS in the country is dependent upon effective
coordination among a number departments/agencies of Government of India.
Sustainable growth in agriculture sector is very critical for maintaining the PDS.
If the agriculture growth does not keep pace with the population growth,
procurement of requisite foodgrains into the central pool becomes a serious
problem. The Department of Agriculture is expected to identify the interventions
necessary to ensure that productivity of the agriculture is enhanced on
sustainable basis to meet the foodgrains requirement under PDS. Food
Corporation of India depends on RBI for availing food credit needed to manage
it’s procurement operations. Timely provision of food credit is very important
for FCI to manage it’s procurement operations smoothly. The Dept of Food and
PDS of GOI need to coordinate with FCI, RBI and state governments to ensure
smooth flow of food credit to FCI and state civil supplies corporations for
managing procurement operations. The Dept of Food and PDS has to coordinate
with Central Warehousing Corporations and the State Warehousing
Corporations for ensuring expansion of storage capacities and also to ensure
scientific storage of the foodgrains. The Dept also has to coordinate with the
departments such as School education and Women and child development of
Government of India and make available the foodgrians, for smooth functioning
of Mid day meals scheme and ICDS.
38
Annexure 1: ICT initiatives undertaken by different states
(Source: Wadhwa Committee report -Feb 2009 )
Haryana
The proposal is to issue smart cards to each level of the distribution chain, i.e. the
transporter, the FPS dealer and the consumer. In Haryana the agency which is
performing the task of transportation of food grains from the godown to the FPS
dealer is called the CONFED.
In the proposed system, when the CONFED transporters take delivery from the
godown, Depot Holder wise distribution information (i.e. the FPS details and quantity
allotted) are loaded on the transporter’s smart card using the STT and 2 receipts are
generated one for the transporter and the other is the copy for the godown in charge.
In this system only a data entry is made and the weight of the stock loaded on the
truck is not cross checked using an electronic weigh bridge in conjunction with the
smart card. In order to eliminate human intervention to the maximum extent
electronic weigh bridges should be used at all whole sale storage points and the stock
loaded in the trucks should be checked using the electronic weigh bridge in
conjunction with the smart card.
When the truck reaches the FPS to deliver the stock, the CONFED transporter inserts
his card in the Depot Holder’s STT. Stock gets automatically transferred in the Depot
Holder’s terminal, the transaction report gets stored in the Transporters card and 2
receipt’s are generated, i.e. one for the FPS dealer and the other for the transporter.
The consumer comes to the FPS for purchase of food grains, inserts his smart card in
the STT, places his finger on the terminal for bio-metric verification. After the details
are verified, the entitlement and price payable are displayed on the terminal. The FPS
dealer thereafter completes the transaction by issuing the desired quantity to the
consumer and the details of the transaction are loaded on the smart card and a paper
receipt is simultaneously issued to the consumer. The system does not provide for
authentication by the consumer, prior to the completion of the transaction as
confirmation that the correct quantity of the stock has been issued to him. The system
should verify the card of the consumer on its being inserted in the STT and there
should be no need to verify the biometric details at this stage. It is only after the
desired quantity is entered by the FPS dealer in the STT and the same is received by
the consumer, should the consumer be required to authenticate the transaction by
placing his finger on the designated spot on the STT, thereby confirming that the
transaction has been completed to his satisfaction. If he does not do so it would
signify that there is some deficiency in the transaction and the transaction would not
be completed and recorded on the STT or the smart card.
Karnataka
Karnataka is the only State which has already commenced the actual implementation
of computerisation of PDS operations. The Karnataka model does not contemplate
issuing a smart card to the beneficiaries. The biometric details of members of each
family, which constitute a unit for the purposes of allotment of stock, are loaded on
the STT at the FPS to which the said family is connected. The beneficiary goes to the
39
FPS, enters his card number in the machine and the terminal displays his entitlement
and the quota available for the month. The FPS dealer then enters the required
quantity into the machine, the beneficiary places his finger on the machine
authorizing the transaction, which is thereafter is completed. One crucial feature of
the Karnataka Model is that the STT also provides a system of ‘voice over’ i.e. when
the FPS dealer enters the quantity in the machine, a voice message is automatically
generated, stating the quantity thereby making verification possible even for an
illiterate person.
Kerala
The Food and Civil Supplies Corporation gets the grains from FCI godowns and
whole-sellers do further distribution. As regards computerization initiatives, a project
namely Target Efficient Transparent Rationing and Allocation (TETRA) in PDS is
being implemented. The Tetra application comprises of modules for Ration Card
Management and Food grains allocation & lifting.
RCMS 3.0 Rations Card Management System is a workflow-based application, which
covers various functions such as Issue of New Ration Cards, Addition of members,
Reduction of member, Issue of Duplicate Ration card, Correction of names of
members, Surrender of Ration Card etc.
Allocation 1.0 covers the allocations, lifting and distribution of food grains at the
wholesale and retail points to FPS. Together they also cover the FPS registration and
licensing.
Chattisgarh
In Chhattisgarh unified Ration card database has been prepared which is used to
generate computerized FPS Allocation, declaration of stock balance, Web based
Truck Challan etc. Thus information regarding allocation, stocks, issue and sales for
each FPS is now available on the central server. The State is also using Global
positioning System (GPS) for tracking the movement of trucks carrying food grain.
This web site based software also provides a method of citizen participation in
monitoring of PDS where citizen can register their mobile no. or e-mail id and can
participate in the monitoring of PDS.A call centre with a toll free number is also
operational for any complaints or suggestions.
Gujarat
In Gujarat the State FCSC operates through its 192 distribution centers for supply of
grains to FPSs. Ration Card computerization has been done across the State.
Madhya Pradesh
In the State of Madhya Pradesh the grain is stored at SWC and CWC godowns in
addition to FCI godowns as this State has de-centralized procurement operations. For
distribution to FPS the grain is lifted by Lead Societies and FPSs are run by
Cooperative societies. The State has developed and implemented web based FPS wise
40
allocation off take monitoring software. The data is assimilated from the various FPS
and entered at district level. The district wise FPS allocation and off take was being
updated on monthly basis. However this has now been discontinued.
Andhra Pradesh
The State has taken initiatives for computerization of Ration card household data. The
household survey was carried out for a large number of parameters and ration card
parameters were a subset of that. For creation Ration Card Designated Photography
Location (DPL) centers were setup to collect/ verify the declaration forms, enter the
beneficiary data in the computer and IRIS scanning was done for each member of
family. Ration card household application is a client-server based application. In AP,
Every district is maintaining its own data but no mechanism has been established for
updating the data or verifying it for duplicates/bogus ration cards. The data at present
is not centralized and hence beneficiary verification across districts is not taking
place. Bar-coded coupons were also introduced in the State. The coupons were given
after manual verification of the beneficiary. This was a difficult process and hence
personalized bar-coded coupons were introduced as pilot for kerosene and Rice.
These coupons were delivered at the door-step of the card holder. However no
mechanism has been set up for scanning of these coupons for verifying the actual
distribution.
Delhi
In Delhi State the CSC pick up grain directly from FCI godowns and supplies it to
FPSs. Therefore the IISFM implemented at FCI depots provides data on releases
under TPDS but exact destination is not being captured currently. The feature can be
incorporated once TPDS computerization scheme is initiated. The Ration Card
survey data has been digitized and laminated cards have been issued.
Tamilnadu
Tamilnadu, being a DCP state, the States Civil Supplies Corporation is responsible for
procurement, paddy milling, storage and distribution of food grains to FPS. The
ration card application is a workflow-based application, which runs at the Taluk
supply office for creations and modification of cards. It is implemented on pilot basis
in north district of Chennai consisting of seven zones. The printing of the card is done
at the Commissioner’s Office; means issuance of any new ration card is done
centrally. The cards carry a hologram and are laminated.
Tamilnadu also has applications that combine POS, smartcard, GPS solutions and
software applications that track the functioning of FPS, the stock availability at
various agencies , GPS tracking of PDS trucks and sms based alerts on stock
positions and on distribution to various stakeholders including the beneficiary.
41
References
Patnaik, U. 2007. “Neoliberalisim and Rural Poverty in India.” Economic and
Political Weekly, July 28: 3132-3150
Patnaik, U. 2004. ‘The Republic of Hunger’, Social Scientist, Vol 32, Nos 9-10,
September-October.
Shah, Mander, Thorat, Deshpande and Baviskar. 2006. Untouchability in Rural India.
New Delhi: SAGE India
42