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The Giant Subsidy Scheme No One Knows How Big

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A few weeks ago, we reported on the wide discrepancy in the numbers of Tamil Nadu state’s colour television giveaway scheme initiated by the DMK Government, now halted by the successive state Government. This writer got an insight into how wildly the scheme was administered when a well-to-do aunt living in the heart of Chennai in a large independent house with several cars was intimated by the PDS department she could go and collect her free colour television set last year. She did not but she could have because she had a `ration card’.
And the scheme involved giving television sets to all those with ration cards. But the problem does not end there. As IndiaSpend has pointed out on several occasions in the past, faulty PDS data compounds several other administrative expenditure heads, some pretty large.


While figures on the precise size and scope of the Public Distribution System (PDS) are difficult to gauge, it’s interesting to see how the estimates can vary. The Report of the Task Force on an IT Strategy for PDS points out that “With a network of more than 4.62 lakh fair price shops (FPS)distributing commodities worth more than Rs 30,000 crore annually to about 180 million families, the PDS in India is perhaps the largest distribution network of its kind in the world.


Very well. Now the Department of Food & Public Distribution who actually runs this network (central + state) on the other hand however says there is a network of 4.99 lakh fair price shops. So what’s 37,000 shops between friends! The Department also points out that the PDS is intended to act as a safety net for the poor whose number is more than 330 million and are nutritionally at risk. But the Task Force talks of 180 million families, which conservatively is 600 to 720 million Indians.  Now, that’s a really wide variation, even for arguments sake. This means, at the least, some 300 million nutritionally not at risk Indians are collecting subsidised food grain.


Interesting, though we all knew it. Now the Secretary, Food & Public Distribution B C Gupta has signed off on the IT Strategy Task Force report so it’s not that Peter does not know what Paul was up to while writing the report. Or perhaps it does not matter. Or we are reading the definitions wrongly and are happy to be corrected or clarified to.

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