Presentation before the Core Group of Central Ministers and Chief Ministers *****

1. Ministry of Food, Consumer Affairs & Public DistributionDepartment of Food & Public DistributionGovt. of India 8th April 2010 Presentation before the Core Group of Central Ministers and Chief Ministers *****

2. Procurement of foodgrains for the Central Pool (in lakh tons) * As on 7.04.2010

3. Actual Stock and Minimum Buffer Norms (In Lakh tons) * Including strategic reserve of 30 lakh tons of wheat & 20 lakh tons of rice

4. Foodgrains Storage – Present Storage Capacities* in Lakh tonnes * includes covered & CAP, own & hired space

5. DAMAGED GRAINS - FCI

6. STORAGE LOSSES Quantity in lakh tonnes

7. Foodgrain Storage - Creation of additional storage capacity • The Planning Commission approved an outlay of Rs.149 crore in the 11th Plan, 125 crore for FCI and 24 crore for North Eastern States and J&K for construction of godowns. This on completion will approximately create 1,50,000 tonnes of space. • To meet the gap in foodgrain storage, FCI will create additional capacities at identified locations through private entrepreneurs. • Assessment of additional storage requirement is based on detailed analysis of overall procurement/consumption in a State and availability of existing storage space. • Requirement of 127.65 lakh MT identified in 15 States. • Offers invited from private partners through tenders.

8. FCI to give a guarantee of 7 years for hiring . An indexed ceiling rate of Rs. 4.78 per quintal per month. High Level Committee authorised to approve higher rates. • CWC/SWC can also construct godowns on their own land. FCI to give a guarantee of 6 years for hiring. • Scheme being extended to DCP States for creating capacities under private partnership by State Governments. Process of identification of requirement to be initiated.

9. TPDS Scale of Issue and CIP of foodgrains

10. Economic Cost, CIP and Subsidy under TPDS

11. Sugar Scale & Coverage

12. Sugar provided for PDS through levy on mills. • Shortfall in production in 2008-09, constrained supply of levy sugar. • Percentage of levy raised from existing 10% to 20% in 2009-10 season to ensure adequate availability for PDS. • Supply position of levy sugar improving.

13. Number of Poor families • Present Formulation – 1993-94 poverty estimates (36%) and population estimates for March 2000 • 6.52 croreBPL families. • If 2003-04 poverty estimates (27.5%) and 2009 population estimates adopted, number will be 5.91 croreBPL families • Tendulkar Committee’s poverty estimates (37.2%) and 2009 population projections, number of BPL families – 8.14 crore • BPL Cards issued by States – 11.12 crore

14. TPDS – Foodgrain requirements and Subsidy Implications under various Poverty Estimates – BPL Families * On the basis of March 2009 population projections

15. TPDS – Foodgrain Requirements and Subsidy Implications under various Poverty Estimates – APL Families at present average allocation * On the basis of March 2009 population projections

16. COMPARATIVE ANALYSIS OF REQUIRED ANNUAL ALLOCATIONS OF FOODGRAINS AND FOOD SUBSIDY

17. Annual Requirement of foodgrains for PDS and Other Schemes (in lakh tonnes) # At present scale of issue * At present levels of allocations. May increase with universalization

18. In order to ensure effective delivery to targetted beneficiaries, need to address distributional deficiencies

19. Leakage and Diversion of subsidized Foodgrains in TPDS as per PEO Study (Year 2005)

20. Findings of ORG-Marg – Year 2005

21. NCAER evaluation (2008) - diversion %

22. NCAER Report - Inclusion/Exclusion Errors

23. Evaluation of PDS – Delivery SystemCentral Vigilance Committee set up by Hon’ble Supreme Court • CVC has submitted study reports for Delhi, Jharkhand, Karnataka, Orissa, Uttarakhand, Andhra Pradesh, Bihar, Gujarat, Rajasthan, Chandigarh, Haryana and Kerala (12 States/UTs) between 2007 to 2010

24. Recommendations of the CVC • Income criterion for poverty to be based on minimum wages for agricultural labour/unskilled workmen • Concept of APL as a category be abolished. Alternatively, the APL category be restricted to households having annual income of Rs.1 Lakh • End-to-end computerization of TPDS operations • GPS be installed for tracking of movement of vehicles transporting TPDS foodgrains • Reconstitute and activate Vigilance Committees, which should meet at regular intervals

25. Recommendations of the CVC (Contd.) • FPS be allotted to persons or groups having kirana/ grocery stores. Sale of non-PDS rice and wheat not to be allowed from such FPS. • Fresh licenses to be granted in a transparent manner. • Door step delivery of foodgrains to FPSs. • Minimum 300-500 ration cards be attached to an FPS to increase viability. • Complaint redressal mechanism with 24 hour helpline for lodging complaints by beneficiaries and follow up action. • Facility of mobile FPS esp. in remote/tribal areas to be encouraged. • Zero tolerance towards corruption. Strict penal action/ departmental action be taken against offenders such as transporters, FPS owners, govt. officials, etc.

26. State specific recommendations of CVC Andhra Pradesh • Automation by IRIS technology not successful for lack of integrated approach resulting in increase of bogus cards. • System of food coupons is a failure as it leads to diversion. • Scheme for rice at Rs.2/kg to be carefully monitored to check increase in number of BPL households to unrealistic levels. Bihar - In 2007, all ration cards to TPDS beneficiaries were cancelled. State should finalise BPL list and issue distinctive ration cards. • Since June 2008, ration coupons being given. In absence of proper accounting and monitoring, coupon system is a failure. • Need to ensure timely distribution of food coupons.

27. State specific recommendations of CVC Delhi - Functions of DSCSC to be taken over by D/o Food and Civil Supplies as there is no vigilance / enforcement machinery with DSCSC to check diversion Gujarat - Dedicated flour mills to be setup on PPP basis with captive production due to large requirements of fortified flour. - Beneficiaries of APL-1 category not getting their due entitlement of food grain. Haryana • Definition of ‘family’ in Haryana PDS (Licensing & Control) Order 2009 presently allows a family to have several licenses. • joint sampling of grain not taking place at all

28. State specific recommendations of CVC Jharkhand - Acute shortage of storage of PDS foodgrains. Need to build more storage capacity for TPDS foodgrains • Scheme for rice at Rs.2/kg to be carefully monitored to check increase in number of BPL households to unrealistic levels. Karnataka - System of allowing Taluka Agric. Produce Coop. Mktg. Society (TAPCMS) to store PDS grains leading to large scale diversions from such godowns • Scheme of temporary ration cards to be done away. Kerala - Authorized Wholesale Distributors (AWDs) be abolished as they indulge in diversion of PDS foodgrains. - Authorised Retail Distributors (ARD) i.e. FPSs should not be appointed for more than 5 years.

29. State specific recommendations of CVC Orissa - Scheme for giving rice at Rs.2/kg to be monitored carefully so that BPL figures do not reach unrealistic levels - Advisory committees at various levels are having a role in appointment of dealers. This creates conflict of interest. Rajasthan - Immediate steps required to strengthen PDS in tribal and drought prone areas and introduction of mobile vans in such areas - State should procure maize and bajra and supply same through PDS as per local requirements. This will check diversion of foodgrains. - Need to create a Food Corporation at State level. Uttarakhand - All families in remote/ inaccessible areas should be treated as BPL - No burden should be placed on consumers towards transportation costs of foodgrains to hilly/ inaccessible areas

30. Nine Point Action Plan to Strengthen TPDS • States should undertake a campaign to review BPL/AAY list to eliminate ghost/ ineligible ration cards. • Strict action should be taken against the guilty to ensure leakage free distribution of foodgrains. iii) For sake of transparency, involvement of elected PRI members in distribution of foodgrains be ensured. • BPL/AAY lists should be displayed on all FPSs. v) District-wise and FPS-wise allocation of foodgrains should be put on websites and other prominent places, for public scrutiny.

31. vi) Wherever possible, doorstep delivery of foodgrains should be ensured by States, instead of letting private transporters/wholesalers to transport goods. vii) Timely availability of foodgrains at FPS level and fixed dates of distribution to ration card holders should be ensured. viii) Training of members of FPS level Vigilance Committees should be ensured. ix) Computerisation of TPDS operations should be undertaken. Nine Point Action Plan to Strengthen TPDS 31

32. Technology based applications for improving functioning of TPDS • Computerization of TPDS operations • FCI to Block level Godowns. Pilot in 3 Districts each of Andhra Pradesh, Assam, Chattisgarh & Delhi (Rs.53.47 crore) • Computerization of ration card related database • 10 states have reported taking up data digitization • Smart Card based delivery to Ration Card holders • Pilot Project in Haryana & Chandigarh (Rs.142.29 crore) • GPS based tracking Vehicles transporting TPDS commodities • Tamilnadu, Delhi and Chattisgarh (Rs.0.45 crore)

33. Implementation of Measures to strengthen Public Distribution System

34. TPDS - Joint Responsibility • TPDS is being implemented under the joint responsibility of Central and the State/UT Govts. • Government of India/ Food Corporation of India to ensure timely availability of foodgrains at all base depots • State Governments to take up further transportation and distribution of foodgrains to identified beneficiaries

35. THANK YOU