program assessment of public distribution system scheme
TRANSCRIPT
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Assessment of Home Delivery Model of Public
Distribution System in India
Kartik Trivedi
MPA
SPEA
Indiana University, Bloomington
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Glossary
• PDS – Public Distribution System
• TPDS – Targeted Public Distribution Sytem
• GoMP – Government of Madhya Pradesh
• BPL – Below Poverty Line
• AAY – Aantyodaya Families
• APL – Above Poverty Line
• PRI – Panchayati Raj Institution (Local self
governance institutions)
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Mandla
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Mandla
• Population – 894236
• Literacy – 60%
• Janpad Panchayat – 9
• Gram Panchayat – 472
• Schedule Tribe –
57.23%
• Villages – 1247
• Area – 8771 sq km
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Introduction to PDS system
• Food and nutrition security program
• Distributed through fair price shops
• Instrument for Governments Economic Policy
• Largest distribution network of its kind with
500,000 fair price shops catering to 330 million
people
• Operated under joint responsibilities by National
and State governments
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RoleNational Government
• Procurement
• Allocation
• Storage
• Price Decisions
• Economic planning
State Government• BPL and AAY
identification
• Distribution and
supervision
• Providing Ration Cards
• Operational
responsibilities
• State level storage
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WFP Allocation
In MT
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Targeted PDS
• Initiated in 1997 to focus on poor
• Introduced to target 60,000,000 BPL beneficiaries
• Transitory support from state government for APL
support (food subsidy)
• AAY support introduced from 2000
• First expansion of AAY in 2003-2004 (23% of BPL)
• Second expansion of AAY in 2004-2005 (31% of
BPL)
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Central Issue Price
Commodity
APL BPL AAY
Wheat 8.30 Rs/kg
5.65 Rs/kg
3.00 Rs/kg
Rice 6.10 Rs/kg
4.15 Rs/kg
2.00 Rs/kg
• Removed urban bias as
most of the BPL and AAY
families reside in rural
areas.
• CIP not revised since 2000
• Catering to 25,000,000 AAY
families
• Still based on 1993 poverty
estimation even though
poverty has been reduced
• 15 Million AAY ration cards
issued in Madhya Pradesh
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Allocation for MP
In MT
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Problems Associated with PDS
• Poor targeting
• Leakages
• Black marketeering
• Urban bias (rural consumers prefer
consuming their own produce)
• Dependence on fine grains
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Description of Mandla Scheme
• Pilot project in 37 panchayats
• 3 month ration in standard size 50kg
bags.
• FPS is brought literally to the door
steps
• Weighed in front of beneficiary
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Advantages
• One time distribution
• Transparency in distribution
• Better spread
• Sustainable
• Lower corruption
• Time saving
• Gender advantages
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Categorical Assessment
• Time Reduction
– Distribution van comes at Gram
Panchayat level
– Villagers from same village benefits
most
– Based on survey, significant conclusion
could not be drawn
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• Money Availability
– 54% of the AAY cardholders depend on daily wages for the
collection of money to purchase their ration
– 47%of the AAY cardholders depend on money borrowed from the
friends and relatives
– BPL cardholders this ratio has increased to around 65% , may be
because of improper targeting
– 33.5% of the respondents opined that they require more money
– 81.6% of the respondents opined that it was difficult for them to
arrange the money
– 1.4% of the respondents expressed the fear of the theft of the ration
Categorical Assessment
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Categorical Assessment
• Wage Loss
– 18.9% of the respondents opined that they
lost their ½ day wages
– 37.7% of the people lost the wages for a day
– 33.5% of the respondents reported no loss
in the wages as other members of the
family brought the ration
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• Dependency on other sources
– 77.4% of the respondents fulfill their demand from the
retail shops
– 45.7% of the people said that the ration lasts for 1-2
months
– 43.4% 0f them said that the ration lasts for 2-3 months
– 7.1% of them borrowed from the other beneficiaries
– 13.2% of the people depends on their own production
Categorical Assessment
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Categorical Assessment
• Number of Dependents
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Old v/s New
• 84.9% of the respondents favored the new
system
• 9.4% of the respondents found the old system
better than the new system
• 55.7% of the respondents in new system and 9%
in the old system found that the salesman did
not work properly
•
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Final Analysis• PDS acts as a nutritional backup and as price stabilizer
• Theoretically designed to cater the needs of all the BPL and AAY people
in country
• The price difference offered between the subsidy and the market makes
the distribution process ripe for corruption
• FPS is not perfect substitute to that available in open-market due to its
poor quality
• Until the buying power of AAY and BPL increases, plugging the leakages
is the only viable option to reduce the subsidy bill for the government
• Reduction in storage costs for the government
• Problem in assessing chronic and acute poor
• ‘Spread’ is still the problem
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