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Chhattisgarh News
Chhattisgarh to start bank transfer of subsidy to PDS beneficiaries
10-03-2015

RAIPUR: The Chhattisgarh government has decided to start direct transfer of Public distribution system (PDS) subsidy from ration shops to the beneficiaries.

According to officials, the pilot scheme of conditional cash transfer would initially be started from six ration shops in urban area of Raipur, Mungeli and Dhamtari from April this year. The aim of commencing this scheme is to avoid duplication and fake cards issue.

According to director of Food Civil Supplies and Consumer Protection Department, Dr Kamalpreet Singh, ration card holders availing subsidies supplied from the six selected shops would have to submit their bank account details along with their Aadhar card number for inclusion in the database. Just like the LPG supply, where subsidy is directly credited to the beneficiaries' bank account, the government would provide subsidy amount of one month in advance.

Singh said, “The subsidy amount will be transferred to the beneficiary as per the quantity usually picked by him from the ration shop and he would have to pay the market price for all the products.” He said the information of the estimated supplies picked by the beneficiaries would have to provided to the Food and Civil supplies department by the ration shop owners.

Singh said the market price for the products distributed through the PDS would be decided soon.

Incidentally the government's decision is not in tune with the World Bank report of 2011, which advocates the concept of phasing out of large scale public distribution of food grains with cash transfers as a long-term solution. The report described the benefits of the PDS scheme as "limited'', pointing out that leakage and diversion of grains is high.

In its report, “Social Protection for a Changing India,” the World Bank said, “In the medium to long term, the report recommends offering households the option of a cash transfer while continuing food-based support for specific situations such as in areas where access is an issue, for disaster relief and for specific vulnerable groups. This reform would not eliminate the need for food buffer stocks.”

However, officials feel that this direct bank transfer of subsidy would be a viable alternative till the government decides on the World Bank recommendations. This system would however, eliminate the use of fake ration cards and plug leaks to a great extent, they claim.

Incidentally the recent ration card scam in the state indicates the existence of 14 lakh fake ration cards. Incidentally, most of these fake ration cards were issued to ineligible or non-existent beneficiaries during the run up for the assembly elections in the state last year.