Govt should distribute cash, not grains, under free food programme
₹4 lakh crore a year.) This is hardly surprising. Nutritional outcomes can only improve with adequate consumption of non-cereals such as pulses, vegetables, milk and so on, which the poor cannot afford to buy at market prices. For that to happen, the food subsidy will have to go beyond providing free cereals.
Evidence supporting the need for this big-ticket reform has been piling up for a while now. Switching to cash transfers is the best way forward. The available evidence suggests that leakages from the free food programme are rampant, as Mint reported recently.
It shows that non-basmati rice exports in FY23 – when India became the world's largest exporter of rice, accounting for 40% of world exports – were at prices below the year's MSP. This, the study argues, suggests that rice from the free food programme has been leaking in large quantities into the export market. The food safety net for people living below the poverty line started as a nearly universal public distribution system before it was replaced in 1997 by a targeted public distribution system (TPDS), which ran until 2012.
The TPDS sold mainly rice and wheat from fair-price shops at significantly lower than market prices. It suffered from well-known deficiencies such as poor identification of the targeted beneficiaries, inefficient delivery and leakages. In 2000 the Antyodaya Anna Yojana (AAY) increased the TPDS focus on the poorest segments of the below-poverty-line (BPL) population.
In 2013 the NFSA paved the way to shift from the welfare approach of the TPDS programme to a rights-based approach for social protection. It legally entitled eligible beneficiaries to receive 5 kg of food grains at highly subsidised prices from the modified TPDS. During the
. Read more on livemint.com
