India’s Public Distribution System (PDS), designed to provide subsidized grains to over 800 million people, is losing food worth Rs.69,000 crore annually due to leakages and theft. According to a report by the Indian Council for Research on International Economic Relations (ICRIER), about 28% of the grains intended for the poor never reach them.
The government procures rice and wheat every year to distribute free or subsidized food grains. However, 20 million tonnes of these grains are reportedly diverted to the open market or exported illegally, raising concerns about the efficiency of the system.
Persistent Challenges in the Distribution System
Although the situation has improved over the years, significant issues remain. In 2011-12, about 46% of PDS grains were leaked. This figure has reduced to 28% in 2022-23, thanks to measures like Aadhaar-linking and point-of-sale (POS) machines introduced in 2016. However, flaws in monitoring and tracking continue to enable widespread corruption.
States with Highest Grain Leakages
Certain states face more severe problems than others.
- Highest Leakage Rates:
States like Arunachal Pradesh, Nagaland, and Gujarat report significant grain theft, largely due to poor digitization in the North-East. - Improved States:
Bihar reduced its leakage rate from 68.7% (2011-12) to 19.2% (2022-23). Similarly, West Bengal lowered its theft rate from 69.4% to 9%. - Most Affected State:
Despite these improvements, Uttar Pradesh remains the state with the highest overall leakage at 33%.
Other states like Maharashtra, Himachal Pradesh, and Uttarakhand continue to struggle with inefficiencies.
Reasons Behind the Leakages
- Ineffective Monitoring Systems:
Despite digital tracking and Aadhaar-linking, the system lacks robust monitoring mechanisms. - Corruption in Distribution:
Corrupt practices at various levels of the supply chain allow grains to be diverted illegally. - Weak Infrastructure in Remote Areas:
The lack of digitization, especially in North-Eastern states, makes the system vulnerable to exploitation.
Recommendations for a Better PDS
Experts suggest several reforms to tackle the inefficiencies and ensure that food reaches the needy:
- Direct Benefit Transfers (DBT):
Replace physical grain distribution with cash transfers or food vouchers to improve transparency. - Targeted Identification:
Reassess the list of beneficiaries to ensure only the truly needy receive the benefits. - Stronger Digital Systems:
Expand digitization and tracking systems to all regions, particularly remote areas, to minimize theft. - Structural Reforms:
Overhaul the supply chain and introduce stricter monitoring to reduce corruption and wastage.
India’s PDS is one of the world’s largest food security programs, providing affordable grains to over 80 crore people. However, without immediate action to address its flaws, the country will continue to face significant financial and resource losses, undermining the program’s goal of fighting hunger and poverty.
