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Challenges and Reforms of Public Distribution System

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  • Last Updated : 12 Oct, 2022
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Under the Ministry of Consumer Affairs, the Government of India established the Public Distribution System (PDS) for the distribution of food grain and non-food grain items among the poor citizens of India at affordable prices. It is an Indian food security system through which Government manage the food scarcity within the country. The Central Government manage the Public Distribution System through the Food Corporation of India (FCI). Though PDS is the largest food distribution system in the world, it also has some drawbacks in its implementation.


  • It secures nutrition and food security around the nation. It helps to stabilize the food price and makes it affordable for the poor population of India. Through MSP and Procurement Price, the government helps to boost food grain production.

Farmer – ->  Central FCI – -> State Govt. –> Fair Price shops –> Consumer
             |                            |                          |                                 |
Procurement at           Allocation      Distribution                 Sale of 
   MSP                          at Central                                          Grain at CIP
                                   issue price


Let us discuss the challenges of the Public Distribution System.

Proper identification of Beneficiaries

  • According to studies, it has been shown that under this system, actual beneficiaries are not getting the proper benefits, but those are not eligible to get undue advantages. 
  • Sometimes the same person gets benefits twice due to double counting.
  • In 2009, a study showed that there were 61% of beneficiaries were actually not poor but getting the benefits and 25% of beneficiaries were poor but not getting the PDS benefits.

Black Marketing of Food Grain

  • During transportation, a large number of food grains are being leaked and sold into the black market by the food price shop owners.
  • A study shows that 37% of food grains were leaked at all Indian levels during 2011-12.
  • As the profit margin of the shopkeepers is low, they are often forced to choose the wrong way.
  • Creating an artificial shortage, all food grains are being accepted at high Procurement Prices.
  • Sometimes, owing to corrupt government employees, daily supervision is not possible.

Environmental Issue

  • MSP encourages farmers to produce those food grains that the government wants to buy to maintain the Buffer Stocks. That means it cast down the diversification of crops.
  • Limited food items are being distributed through PDS. So, indirectly government has been encouraging the farmer to produce such food items only. It breaks the repetition of the food cycle which reduces the nutrition of the soil. Farmers are also using fertilizer in an unscientific way to increase food production. But it makes the soil toxic. Overuse of groundwater for irrigation may also increase the pH value of soil and makes it alkaline.


  • The problem of the proper identification of the poor would be resolved by connecting the Aadhaar card with the Rationing system. The biometric facility of Aadhaar cards would help to eliminate fake or duplicate beneficiaries and also help to identify the actual beneficiaries.
  • Using Computer base technology would help the PDS be more transparent. It will also help to reduce the leakage of food grains and stop the black marketing of those food items.
  • Madhya Pradesh government has used such computer-based technologies to make the digital ration card and used a GPS tracking system to track ration delivery. Gujarat, Maharashtra, Chhattisgarh, 
    Andhra Pradesh etc. States are using the same technology.
  • The computerization of PDS can quickly show the food stock balance and allows quick transactions.
  • SMS alerts through SMS based monitoring system allow the citizens about the arrival and dispatch of their PDS. This technology is used by Chhattisgarh, Uttar Pradesh and Tamil Nadu state.
  • Web-based portal for PDS also makes the system more transparent. It also uses for getting suggestions from people for the betterment and to register to complain through the given toll-free number.
  • A Vigilance square should be constructed to eliminate Fake beneficiaries.
  • The profit margin of the shopkeepers should be increased for honest business.
  • Government should encourage farmers to grow other crops So that the crop cycle is maintained. 
  • Farmers should be aware so that they do not use fertilizers or pesticides in the mean of unscientific methods.
  • Instead of food grain subsidy, the government may transfer cash directly to the account of a beneficiary through Direct Benefit Transferred (DBT) Scheme under the National Food Security act 2013. According to an estimate, through the DBT system, the government can save Rs. 30,000 Cr. every year.
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