
## Demand For Grants 2022-23 Analysis Food And Public Distribution

The Ministry of Consumer Affairs, Food and Public Distribution has two Departments: (i) Food and Public Distribution, and (ii) Consumer Affairs. Allocation to the Ministry accounts for 6% of the budget of the central government in 2022-23.1 
Department of Consumer Affairs is responsible for spreading awareness among consumers about their rights, protecting their interests, implementing standards, and preventing black marketing.2  In 2022-23, the Department has been allocated Rs 1,725 crore, a 30% decrease over the revised estimate of 2021-22.3 
Department of Food and Public Distribution is responsible for ensuring food security through procurement, storage, and distribution of food grains, and for regulating the sugar sector.4  In 2022- 23, the Department has been allocated Rs 2,15,960 crore (99% of the Ministry's allocation).5  This is a decrease of 28% as compared to the revised estimate of 2021-22. 

Department 
2020-21 
Actuals 
2021-22 
Revised 
2022-23 
Budgeted 
% change in 
2022-23 BE 
over 2021-22 
RE  
Food & Public Distribution 
5,55,432 3,02,000 
2,15,960 
-28% 
Consumer Affairs 
11,365 
2,454 
1,725 
-30% 
Total 
5,66,797 3,04,454 
2,17,684 
-28% 

Sources: Expenditure Budget, Union Budget 2022-23; PRS. 

This note examines the allocation to the Department of Food and Public Distribution.  It also discusses the broad issues in the sector and key observations and recommendations made in this regard. 

## Overview Of Finances

Food subsidy is the largest expenditure by the Department of Food and Public Distribution.  96% of the Department's allocation in 2022-23 is towards food subsidy (see Table 7 in the Annexure for more details).  The subsidy is provided to the Food Corporation of India (FCI) and states for procuring food grains from farmers at government notified prices and selling them at lower subsidised prices (known as Central Issue Prices), under the National Food Security Act, 2013.  The Act mandates coverage of 75% of the population in rural areas and 50% in urban areas, and covers 81 crore persons.6,7 The subsidy also covers the storage cost incurred by FCI in maintaining buffer stocks in order to ensure food security in the country.  Table 2 shows the expenditure on food subsidy during 2012-23. 

Table 2: Expenditure on food subsidy (Rs crore) 
Year 
Allocation 
Expenditure 
% utilisation 
2012-13 
75,000 
85,000 
113% 
2013-14 
90,000 
92,000 
102% 
2014-15 
1,15,000 
1,17,671 
102% 
2015-16 
1,24,419 
1,39,419 
112% 
2016-17 
1,34,835 
1,10,173 
82% 
2017-18 
1,45,339 
1,00,282 
69% 
2018-19 
1,69,323 
1,01,327 
60% 
2019-20 
1,84,220 
1,08,688 
59% 
2020-21 
1,15,570 
5,41,330 
468% 
2021-22 
2,42,836 
2,86,469# 
118% 
2022-23 
2,06,831* 
- 
- 

Note: *Budget estimate; #Revised estimate. Sources: Expenditure Budget, Union Budgets (various years); PRS. 

The central government provides food subsidy to 
FCI as reimbursement of the loss it incurs in its 
procurement, storage, and distribution operations.  
During the period 2016-20, although the Department 
used to receive sufficient allocation for payment to 
FCI, due to budget cuts made during the year, the 
actual amount paid to FCI was much lower.  The 
Comptroller and Auditor General (CAG) of India 
(2019) observed that when the food subsidy budget 
is not sufficient to clear FCI's dues, such dues are 
carried over to the next year.8  Due to such 
carryovers every year, payment due to FCI for food 
subsidy increased from Rs 81,303 crore at the end of 
2016-17 to Rs 2,43,779 crore at the end of 2019-20.9 

The Department was allocated Rs 1,84,220 crore for 
food subsidy in 2019-20.  However, only 59% of the 
allocation was utilised as the food subsidy provided 
to FCI decreased from Rs 1,51,000 crore (budget 
estimate) to Rs 75,000 crore.  As directed by the 
Ministry of Finance, the Department deferred the 
payment of food subsidy due to FCI, resulting in an 
underspending of Rs 76,000 crore.10  

In the meanwhile, the government provided loans to 
FCI from the National Small Savings Fund (NSSF) 
to meet its operational requirements.  NSSF loans 
worth Rs 2,54,600 crore were outstanding with FCI 
at the end of 2019-20.11  In her 2021-22 budget 
speech, the Finance Minister announced that the 
government will discontinue the NSSF loans given 
to FCI and accordingly make budget provisions in 
2020-21 and 2021-22.12  Following this 
announcement, the total expenditure on food 
subsidy increased to Rs 5,41,330 crore in 2020-21, 
an increase of 398% over the expenditure in 2019-
20.  Out of this the food subsidy given to FCI was 

Rs 4,62,789 crore in 2020-21.  According to the revised estimate for 2021-22, there are estimated to be no NSSF loans outstanding with respect to FCI.13 Note that in 2021-22, FCI has claimed Rs 2,17,460 crore as food subsidy which is 95% of the food subsidy bill for the entire year.  Against this, in the revised estimate of 2021-22, the central government has provided Rs 2,10,929 crore which is lesser than the subsidy claimed by FCI.  In 2022-23, the central government has allocated Rs 2,06,831 crore for food subsidy out of which Rs 1,45,920 (71%) crore is for providing food subsidy to FCI.  

| 2016-17         | 2017-18          |
|-----------------|------------------|
| Subsidy Claimed | Subsidy Received |
|                 |                  |

Note: Data for 2021-22 is up to January 31, 2022. Sources: Report of Comptroller and Auditor General of India on Compliance of the Fiscal Responsibility and Budget Management Act, 2003 (2018); Food Corporation of India; PRS. 

Since April 2020, the government has been implementing the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) in phases.  Under the programme, which was announced in March 2020, the government has been allocating additional 5 kg of wheat or rice to 80 crore people free of cost under the National Food Security Act, 2013.14  This is over and above the monthly entitlements under the National Food Security Act.  In the first and second phases of the scheme, the government allocated one kg of pulses and chana respectively to the beneficiaries.15  The fifth phase of the scheme, which was approved by the Cabinet in November 2021, will run from December 2021 till March 2022.16  The government is expected to incur an expenditure of nearly Rs 2.6 lakh crore under the five phases of the scheme.16  The fifth phase alone is estimated to entail an additional food subsidy bill of Rs 53,345 crore.        

## Components Of Food **Subsidy**

Expenditure on food subsidy can be classified under the following three heads (break-up in Table 3): 

- 
Subsidy to FCI: The Food Corporation of 
India (FCI) receives subsidy for procuring food grains from farmers at government notified prices and selling them at lower subsidised prices.  It also receives subsidy for the storage cost incurred in maintaining buffer stocks. 
- 
Subsidy to states: Under the decentralised 
procurement scheme, states may choose to undertake the operations of procurement, storage, and distribution on behalf of FCI.  In such cases, states are provided with subsidy. Currently, 17 states undertake procurement of 
rice and wheat. 
- 
Sugar subsidy: Sugar subsidy is provided for 
giving one kg of sugar per month at subsidised rates to families covered under the Antyodaya Anna Yojana (i.e., poorest of the poor families). 
In 2022-23, subsidies to FCI and states form 71% and 29% of the allocation for food subsidy, respectively. 

Subsidy 
2020-21  
Actuals 
2021-22  
Revised 
2022-23 
Budgeted 
% change in 
2022-23 BE 
over 2021-
22 RE 
Subsidy to FCI 
4,62,789 2,10,929 
1,45,920 
-31% 
78,338 
75,290 
60,561 
-20% 
Subsidy to states (decentralised procurement) Sugar subsidy 
203 
250 
350 
40% 
Total 
5,41,330 2,86,469 
2,06,831 
-28% 

Sources: Expenditure Budget, Union Budget 2022-23; PRS. 

## Issues In The Sector

FCI and state agencies procure food grains from 
farmers at the government notified Minimum 
Support Prices (MSPs).  These food grains are 
provided to the economically weaker sections at 
subsidised prices through fair price shops under the 
Public Distribution System (PDS).  The central and 
state governments provide subsidised food grains to 
beneficiaries under the National Food Security Act, 
2013 as well as under certain other welfare schemes 
such as the Mid-Day Meal scheme.  In this section, 
we examine some issues relating to the: (i) factors 
increasing food subsidy bill, (iii) procurement and 
storage of food grains, and (iv) sugarcane dues to 
farmers. 

## Minimum Support Price And Farm Production

Minimum support price is the assured price 
announced by the central government at which food 
grains are procured from the farmers by central and 
state governments along with their agencies.6  This 
procurement is done for the central pool from which 
allocations are made under PDS and also kept as 
reserves.  MSPs are announced each year for 23 
crops.  However, procurement is limited to a few 
crops such as rice, wheat, pulses, and coarse grains.  
Figure 2 shows that 49% of the rice produced in 
2020-21 was procured by the government while the 
figure for wheat was 40%.  Under the National Food 
Security Act, the central and state governments have 
to undertake necessary reforms in targeted PDS.6  

One of those reforms is to diversify the commodities 

distributed under PDS.6 
The Economic Survey of 2019-20 noted that the government procures around 40-50% of the total market surplus of rice and wheat.17  MSP was designed to be indicative prices for farmers at the start of the sowing season and act as an insurance in times of fall in prices.  The Survey pointed out that the increasing trend in MSPs gives a signal to farmers to opt for the crops that have an assured procurement system.17  This also shows that market prices do not offer remunerative options for farmers and MSPs act as maximum prices that farmers can realise.17  This puts pressure on the water table as these crops (especially paddy and sugarcane) are water-intensive.18  Also, the bulk of MSP procurement is geographically concentrated in a few states.  As shown in Figure 3, in 2020-21, 64% of the rice procured was from five states.  However, the contribution of these states in the total production of rice in the same year was only 36%. Similarly, 80% of the wheat procured in 2021-22 
was from the three states of Punjab, Madhya Pradesh and Haryana.  Taken together these states contributed to only 43% of the total wheat production in 2020-21.  Note that the National Food Security Act provides for geographical diversification of procurement operations.6       
Note: Wheat procured in 2021-22 is for crop produced in 2020- 21. Sources: Department of Food and Public Distribution; PRS. 

## Revision Of Central Issue Price (Cip)

Under the National Food Security Act, 2013, food grains are allocated to the beneficiaries at the CIP. These prices have not changed since July1, 2002.19  

| Food grain    |   AAY  |   BPL  |   APL  |
|---------------|--------|--------|--------|
| Rice          |      3 |   5.65 |    8.3 |
| Wheat         |      2 |   4.15 |    6.1 |

Note: AAY - Antyodaya Anna Yojana, BPL - Below Poverty Line, APL - Above Poverty Line. Sources: FCI; PRS. 

Food subsidy has three elements: (i) consumer 
subsidy, (ii) cost of maintaining buffer stock, and 
(iii) subsidy on coarse grains, regularisation of 
FCI's operational losses and other non-plan 
allocation to states.20  Consumer subsidy is the 
difference between the economic cost and CIP.  
Economic cost includes cost of procurement, 
acquisition, and distribution.  In 2002-03, from 
when the CIP has been effective, the economic cost 
of rice was Rs 11.7 per kg  and for wheat it was Rs 
8.8 per kg.20  In 2022-23, the economic cost of rice 
and wheat is estimated to increase to Rs 36.7 per kg 
and Rs 25.9 per kg repectively.20  Due to non-
revision of CIP to reflect the increase in economic 
cost of food grains distributed under PDS, the food 
subsidy bill has increased over the years.   

The Standing Committee on Food, Consumer Affairs and Public Distribution (2017) noted that the food subsidy bill has increased due to increase in MSP of wheat and rice with respect to the CIP, increased off take of food grains under targeted PDS, and implementation of national Food Security Act, 2013 in all states/UTs. 21  The 15th Finance Commission observed that the increase in economic cost of food grains will need to be partially offset by increasing CIP of subsidised food grains.22  The Economic Survey 2020-21 noted that the central government's food subsidy bill is becoming unmanageably large.23  The Survey said that while it is difficult to reduce the economic cost of food management, there is a need to consider revising CIP to reduce food subsidy bill.23  

## Delivery Of Food Subsidy

Leakages in PDS:  Leakages refer to food grains not reaching the intended beneficiaries.  Note that recent data on leakage is not publicly available.  The latest available data is for 2011.  According to the 2011 data, leakages in PDS were estimated to be 46.7%.24,25 Leakages may be of three types: (i) pilferage or damage during transportation of food grains, (ii) diversion to non-beneficiaries at fair price shops through issue of ghost cards, and (iii) exclusion of people entitled to food grains but who are not on the beneficiary list.26,27  Studies have shown that targeting mechanisms such as TPDS are prone to large exclusion and inclusion errors.28 
Exclusion errors occur when entitled beneficiaries do not get food grains.  It refers to the percentage of poor households that are entitled to but do not have PDS cards.  Exclusion errors had declined from 55% in 2004-05 to 41% in 2011-12.29 
Inclusion errors occur when those who are ineligible get undue benefits.  Inclusion errors had increased from 29% in 2004-05 to 37% in 2011- 12.29 For eliminating leakages, states/UTs have been 
 

suggested two, options: (i) direct cash transfer and 
(ii) automation of fair price shops (FPSs).30  The 
direct cash transfer scheme is being implemented in 
Chandigarh and Puducherry from September 2015 
and in part of Dadra and Nagar Haveli from March 
2016.30  Direct cash transfers give the option to 
beneficiaries to buy the food grains of their choice 
and diversify consumption based on dietary 
preferences.  However, beneficiaries may have to 
face higher costs in accessing the cash transfer due 
to factors such as distance and higher waiting time 
for cash withdrawal.30  There have also been certain 
reports of inadequate availability of food grain in 
the open market.  

The High-Level Committee on Restructuring of FCI 
(2015) had suggested that switching to DBT for 
food subsidy would reduce the food subsidy bill of 
the government by more than Rs 30,000 crore 
annually.24  It suggested that cash transfers can be 
indexed with the overall price level to protect the 
amount of real income transfers. 

The High-Level Committee had also recommended 
the introduction of biometric authentication and 
Aadhaar to address leakages in PDS.24  In February 
2017, the Ministry made it mandatory for 
beneficiaries under the National Food Security Act, 
2013 to use Aadhaar as proof of identification for 
receiving food grains.31  Note that non-linking of 
Aadhaar with ration cards is not a ground for 
cancellation of ration cards.32  The deadline for 
applying for Aadhaar enrolment in order to avail 
subsidised food grains or cash transfer of food 
subsidy, has been extended to March 31, 2022.33  As 
on December 9, 2020, 91% of the ration cards have 
been seeded with Aadhaar.  States and UTs have 
deleted 4.28 crore bogus ration cards during 2014-
2021.32  This is due to measures such as the use of 
information technology reforms, digitisation of 
ration cards data, de-duplication process, permanent 
migration, and identification of ineligible/duplicate 
ration cards.    

Note that beneficiaries may face issues with 
Aadhaar authentication while availing PDS benefits. 
According to the data submitted by UIDAI to the 
Supreme Court in Justice K. S. Puttaswamy vs 
Union of India, the Aadhaar authentication failure 
rate (across all purposes) was 8.5% for iris scans 
and 6% for fingerprints.34  In its judgement, the 
Court held that services cannot be denied to 
beneficiaries due to Aadhaar authentication failure.34 

In addition to implementing cash transfers, 
automation of FPSs is done by installing electronic 
point of sale devices (ePoS).  This helps in 
transparent distribution of food grains after unique 
identification of beneficiaries.30  In addition to this, 
ePoS devices also upload the electronic records of 
sale transactions to centralised servers in 
states/UTs.30  At all India level, as of December 
2020, 92% of FPSs have been automated. 

 

is pending  
| Operational    | % FPS    |
|----------------|----------|
| State/UT       |          |
| Total          |          |
| FPS            | ePoS     |
| Andaman and    |          |
| Nicobar        |          |
| 464            | 445      |
| Arunachal      |          |
| Pradesh        |          |
| 1,943          | 683      |
| Assam          | 38,237   |
| Chhattisgarh   | 12,304   |
| Delhi          | 2,018    |
| Karnataka      | 19,935   |
| Manipur        | 2,333    |
| Meghalaya      | 4,709    |
| Mizoram        | 1,241    |
| Sikkim         | 1,362    |
| Uttarakhand    | 9,908    |

Note: Data as on December 9, 2020. Sources: 12th Report, Standing Committee on Food, Consumer Affairs and Public Distribution (2020-21); PRS. 

One Nation One Ration Card (ONORC): From April 2018, the Department has been implementing the Integrated Management of Public Distribution System scheme. 35  The scheme aims to provide nation-wide portability of ration cards through ONORC.35  It allows all beneficiaries under the National Food Security Act, 2013 to collect their entitled food grains from any FPS in the country. As of August 2021, the scheme has been implemented in 34 states/UTs with 24 crore portability transactions carried out between April 1, 2020 and September 30, 2021.36  Note that between August 2019 and November 2020, out of 18.98 crore portability transactions, only 22,087 transactions were for inter-state portability while the rest were for intra-state portability.30  This could be due to: (i) restrictions by states on biometric authentication of beneficiaries due to COVID-19 and (ii) lack of awareness among beneficiaries.30   

## Procurement Of Food Grains

The Department of Food and Public Distribution is the nodal department for making policies with regard to procurement, movement, scientific research, storage, distribution, and sale of food grains.  FCI and other state agencies procure wheat and paddy at MSP.37  Coarse grains are procured by state government agencies for the central pool as per the direction of the central government.37 There are two broad procurement systems: (i) centralised procurement and (ii) decentralised procurement.38  Under the centralised procurement system, food grains are procured either directly by the FCI or by state government agencies.  The food grains procured by state agencies are handed over to FCI for storage, distribution, or transportation. Under decentralised procurement, state government/agencies procure, store, and distribute rice/wheat/coarse grains within the state.  The excess stocks of rice and wheat are handed over to FCI in the central pool.  15 states procure rice and 

eight states procure wheat under decentralised 
procurement.  Presently, FCI plays only a 
supporting role in procurement of food grains and 
direct procurement by FCI is less than 5%.  All 
operations are conducted by state agencies.       

central pool (in lakh metric tonnes) 
|          |   Year  | Rice    |   Wheat  |
|----------|---------|---------|----------|
| 2015-16  |  342.18 |         |   280.88 |
| 2016-17  |  381.06 |         |   229.61 |
| 2017-18  |  381.74 |         |   308.24 |
| 2018-19  |  443.99 |         |   357.95 |
| 2019-20  |  518.26 |         |   341.32 |
| 2020-21  |  601.85 |         |   389.92 |
| 2021-22* |  452.26 |         |   433.44 |

Note: *Data for rice procurement for 2021-22 is up to February 10, 2022. Sources: FCI; PRS. 

The Standing Committee on Food, Consumer 
Affairs, and Public Distribution (2021) noted that 
after 23 years of its inception, decentralised 
procurement is not carried out in all states.35  
Decentralised procurement has increased the 
efficiency of PDS by making it possible to supply 
food grains suited to local tastes.35  The Committee 
expected the central government to take steps for 
motivating the remaining states to adopt the scheme.  
This will help lower the cost of distribution.  It 
recommended the Department/FCI to take steps to 
create necessary infrastructure in coordination with 
state governments.35      

## Storage Capacity

Note: Data as on April 1 of each year. 

Sources: FCI; PRS.   

The Department also has the responsibility to ensure 
availability of storage capacities in various states.  
In 2022-23, the central government has allocated Rs 
33 crore for creation of storage capacity through 
FCI and state governments.5  FCI has its own 
network of storage infrastructure.  It also hires 
additional storage facilities from state warehousing 
corporations and Central Warehousing 
Corporation.35  The existing storage facilities are 
primarily conventional godowns where food grains 
are stacked in bags.35  During peak procurement 

periods, FCI also uses cover and plinth (CAP) 
facilities for short-term storage of food grains.35  As on April 1, 2021, FCI had storage capacity of 415 lakh metric tonnes.39       
 
Note: Data as on June 1 of every year. Data for covered and CAP storage. Sources: Standing Committee on Food, Consumer Affairs and Public Distribution; PRS. The Standing Committee (2021) noted that the utilisation of hired storage capacity is much higher than the storage capacity owned by FCI.35  This is despite internal audit, audit by Comptroller and Auditor (CAG) of India, and review of capacity utilisation.  The Committee recommended that godowns should be hired only when it is absolutely necessary.35  It recommended that FCI should utilise its own storage capacity to the maximum to save funds spent on renting storage space.35 The Standing Committee (2021) was informed that storage capacity is hired only when there is absolute necessity for it.35  This is the reason that hired capacity is utilised fully.  Also, once constructed, owned capacity cannot be shifted to a different location due to change in procurement pattern or change in offtake of food grains.35 The Standing Committee noted that during 2020-21, FCI could not achieve physical and financial targets for construction of godowns.35  For instance, the physical targets for construction of godowns in north-eastern states was 30,020 metric tonnes. However, as on January 31, 2021, no construction had taken place.  Similarly, for states other than north-eastern states, the target was 6,220 metric tonnes.  But, again, no construction took place.  The Committee observed that the Department/FCI should make efforts to expedite completion of ongoing godown construction projects.35  FCI faces problems in the construction of godowns in the north eastern regions due to: (i) difficult terrain, (ii) land acquisition restrictions, (iii) law and order situation, and (iv) inclement weather.35  The Committee recommended that the Department should take up the matter with the states/UTs to solve the problem of storage.  It also recommended creating mini godowns in different parts of states/UTs.35   

## Sugarcane

The Department is also responsible for formulation 
of policies and regulations for the sugar sector.  This 
includes fixing the Fair and Remunerative Price 
(FRP) of sugarcane which is payable to farmers by 
sugar factories, training in sugar technology, and 
regulation of supply of free sale sugar.  As of 
November 26, 2021, Rs 4,940 crore are pending in 
dues to sugar farmers for the sugar seasons 
(October-September) of 2018-19, 2019-20, and 
2020-21.40          

Sugarcane dues: The sugar sector has been facing 
certain issues related to profitability and liquidity in 
the last few years.41  Depressed sugar prices have 
often led to sugar mills unable to pay the entire 
compensation to farmers for buying sugarcane.  
Certain state governments fix their own State 
Advised Price at levels higher than the FRP 
announced by the central government.  This causes 
further strain on the financial health of the sugar 
mills.41  A Task Force on Sugarcane and Sugar 
Industry (2020) recommended that sugarcane prices 
must be linked to sugar prices.41  Increases in FRP 
should be kept moderate and state announcing SAP 
should bear the additional costs associated with it.41    

The Task Force recommended a staggered payment 
mechanism for sugarcane so that the entire dues to 
the farmers are cleared within two months.  The 
central government also fixes the minimum selling 
price for white/refined sugar.  This was increased 
from Rs 29 per kg to Rs 31 per kg with effect from 
February 14, 2019.42  The task force had 
recommended increasing the minimum selling price 
of sugar to Rs 33 per kg with it being reviewed six 
months after notification.41  This would aid sugar 
mills to cover their cost of production and 
maintenance costs.  

The central government has taken measures to divert 
excess sugarcane/sugar for production of ethanol.43   
Note that in every sugar season, the production of 
sugar is around 320-330 lakh metric tonne as against 
the domestic consumption of 260 lakh metric 
tonne.43  This subdues the price of sugar in the 
domestic market leading to loss for sugar mills.  In 
the last three sugar seasons, about Rs 22,000 was 
generated by sugar mills/distilleries from sale of 
ethanol to oil marketing companies.43  In sugar 
season 2021-22, 35 lakh metric tonne of excess 
sugar is likely to be diverted for producing ethanol 
as compared to around 24 lakh metric tonne in 
2020-21.43       

Sugar Development Fund (SDF): SDF was 
established in 1982 and grants loans to sugar mills 
for schemes such as modernisation and expansion of 
sugar factory, and cane development.44  The task 
force recommended to levy a cess on sugar at Rs 50 
per quintal for three years.41  This would add about 
Rs 4,500 crore to the fund which can act as a 
comfort for banks lending to sugar mills for paying 
dues to farmers and improving technologies.

2020-21 
Actuals 
2021-22 
Budgeted 
2021-22 
Revised 
2022-23 
Budgeted 
% change in 2022-23 
BE over 2021-22 RE 
 
Food subsidy 
5,41,330 
2,42,836 
2,86,469 
2,06,831 
-28% 
       Subsidy to Food Corporation of India (FCI) 
4,62,789 
2,02,616 
2,10,929 
1,45,920 
-31% 
       Subsidy to states (decentralised procurement) 
78,338 
40,000 
75,290 
60,561 
-20% 
       Sugar subsidy payable under PDS 
203 
220 
250 
350 
40% 
Assistance to state agencies for intra-state movement of food grains and for margin of fair price shops' dealers 
6,483 
4,000 
6,000 
- 
-100% 
Investment in equity capital of FCI 
1,000 
2,500 
2,500 
1,900 
-24% 
Scheme for defraying expenditure on transport and marketing of sugar exports, including handling and processing 
301 
2,000 
3,503 
- 
-100% 
Scheme for assistance to sugar mills for 2019-20 season 
3,900 
1,000 
2,150 
- 
-100% 
Scheme for creation and maintenance of buffer stock of sugar 
600 
650 
765 
- 
-100% 
Financial assistance to sugar mills for enhancement and augmentation of ethanol production capacity 
150 
300 
160 
300 
88% 
Schemes for development of sugar industries 
175 
187 
143 
85 
-41% 
Scheme for extending soft loan to sugar mills 
418 
- 
- 
- 
- 
Department 
5,55,432 
2,53,974 
3,02,000 
2,15,960 
-28% 

Sources: Demand no. 15, Department of Food and Public Distribution, Expenditure Budget, Union Budget 2022-23; PRS. 

 
Year 
Procurement 
Offtake 
% Offtake 
Stocks 
Rice 
Wheat 
Total 
Rice 
Wheat 
Total 
Rice 
Wheat 
Total 
2004-05 
24.7 
16.8 
41.5 
23.2 
18.3 
41.5 
100% 
13.3 
4.1 
18.0 
2005-06 
27.6 
14.8 
42.4 
25.1 
17.2 
42.3 
100% 
13.7 
2.0 
16.6 
2006-07 
25.1 
9.2 
34.3 
25.1 
11.7 
36.8 
107% 
13.2 
4.7 
17.9 
2007-08 
28.7 
11.1 
39.8 
25.2 
12.2 
37.4 
94% 
13.8 
5.8 
19.8 
2008-09 
34.1 
22.7 
56.8 
24.6 
14.9 
39.5 
70% 
21.6 
13.4 
35.6 
2009-10 
32.0 
25.4 
57.4 
27.4 
22.4 
49.8 
87% 
26.7 
16.1 
43.3 
2010-11 
34.2 
22.5 
56.7 
29.9 
23.1 
53.0 
93% 
28.8 
15.4 
44.3 
2011-12 
35.0 
28.3 
63.3 
32.1 
24.3 
56.4 
89% 
33.4 
20.0 
53.4 
2012-13 
34.0 
38.2 
72.2 
32.6 
33.2 
65.8 
91% 
35.5 
24.2 
59.8 
2013-14 
31.9 
25.1 
57.0 
29.2 
30.6 
59.8 
105% 
30.6 
17.8 
49.5 
2014-15 
31.6 
28.0 
59.6 
30.7 
25.2 
55.9 
94% 
23.8 
17.2 
41.3 
2015-16 
34.1 
28.1 
62.2 
31.8 
31.8 
63.6 
102% 
28.8 
14.5 
43.6 
2016-17 
36.5 
23.6 
60.1 
32.8 
29.1 
61.9 
103% 
29.8 
8.1 
38.1 
2017-18 
37.6 
30.6 
68.2 
35.0 
25.3 
60.3 
88% 
30.0 
13.2 
43.3 
2018-19 
42.7 
35.0 
77.7 
34.4 
31.5 
65.9 
85% 
37.7 
34.9 
72.7 
2019-20 
46.1 
34.1 
80.2 
35.0 
27.2 
62.2 
78% 
49.2 
24.7 
74.0 
2020-21 
58.2 
39.0 
97.2 
56.3 
36.8 
93.1 
96% 
49.9 
27.3 
78.0 

Sources: Database on Indian Economy, Reserve Bank of India, as of February 7, 2022; PRS. 

 

Online Allocation 
State/ UT 
Digitisation of 
Ration Cards 
Aadhaar Seeding 
with Ration Cards 
of Food grains 
Computerisation 
of Supply Chain 
Andhra Pradesh 
100% 
100% 
Implemented 
Implemented 
Arunachal Pradesh 
100% 
45% 
- 
- 
Assam 
100% 
0% 
Implemented 
- 
Bihar 
100% 
83% 
Implemented 
Implemented 
Chhattisgarh 
100% 
100% 
Implemented 
Implemented 
Goa 
100% 
100% 
Implemented 
Implemented 
Gujarat 
100% 
98% 
Implemented 
Implemented 
Haryana 
100% 
100% 
Implemented 
Implemented 
Himachal Pradesh 
100% 
94% 
Implemented 
Implemented 
Jharkhand 
100% 
97% 
Implemented 
Implemented 
Karnataka 
100% 
100% 
Implemented 
Implemented 
Kerala 
100% 
98% 
Implemented 
- 
Madhya Pradesh 
100% 
92% 
Implemented 
Implemented 
Maharashtra 
100% 
96% 
Implemented 
Implemented 
Manipur 
100% 
31% 
Partial 
- 
Meghalaya 
100% 
0% 
- 
- 
Mizoram 
100% 
83% 
Implemented 
- 
Nagaland 
100% 
57% 
- 
- 
Odisha 
100% 
92% 
Implemented 
Implemented 
Punjab 
100% 
98% 
Implemented 
- 
Rajasthan 
100% 
96% 
Implemented 
- 
Sikkim 
100% 
87% 
Implemented 
- 
Tamil Nadu 
100% 
100% 
Implemented 
Implemented 
Telangana 
100% 
100% 
Implemented 
Implemented 
Tripura 
100% 
98% 
Implemented 
Implemented 
Uttar Pradesh 
100% 
92% 
Implemented 
Implemented 
Uttarakhand 
100% 
90% 
Implemented 
- 
West Bengal 
100% 
63% 
Implemented 
Implemented 
Andaman and Nicobar Islands 
100% 
100% 
Implemented 
Implemented 
Chandigarh 
100% 
100% 
Direct Benefit 
Direct Benefit 
Dadra and Nagar Haveli 
100% 
100% 
Implemented 
Implemented 
Daman and Diu 
100% 
100% 
Implemented 
Implemented 
Delhi 
100% 
100% 
Implemented 
Implemented 
Jammu and Kashmir  
100% 
59% 
- 
- 
Lakshadweep 
100% 
98% 
- 
NA 
Puducherry 
100% 
100% 
Direct Benefit 
Direct Benefit 
Total 
100% 
84% 
30 
21 
Sources: Department of Food and Public Distribution; PRS. 
 
 
Year 
Paddy (common) 
% increase over last year 
Wheat 
% increase over last year 
2011-12 
1,080 
8.0% 
1,285 
14.7% 
2012-13 
1,250 
15.7% 
1,350 
5.1% 
2013-14 
1,310 
4.8% 
1,400 
3.7% 
2014-15 
1,360 
3.8% 
1,450 
3.6% 
2015-16 
1,410 
3.7% 
1,525 
5.2% 
2016-17 
1,470 
4.3% 
1,625 
6.6% 
2017-18 
1,550 
5.4% 
1,735 
6.8% 
2018-19 
1,750 
12.9% 
1,840 
6.1% 
2019-20 
1,815 
3.7% 
1,925 
4.6% 
2020-21 
1,868 
2.9% 
1,975 
2.6% 
2021-22 
1,940 
3.9% 
2,015 
2.0% 

 Sources: Commission for Agricultural Costs and Prices, Ministry of Agriculture and Farmers' Welfare; PRS. 

State 
Arrears of 
2018-19 
Arrears of 
2019-20 
Arrears of 
2020-21 
Total Arrears 
Andhra Pradesh 
37 
43 
37 
117 
Bihar 
50 
39 
4 
93 
Chhattisgarh 
6 
- 
64 
70 
Goa 
2 
- 
- 
2 
Gujarat 
- 
- 
44 
44 
Haryana 
- 
- 
63 
63 
Karnataka 
9 
5 
- 
14 
Madhya Pradesh 
2 
- 
1 
3 
Maharashtra 
81 
- 
394 
475 
Odisha 
- 
- 
- 
0 
Punjab 
- 
43 
9 
52 
Tamil Nadu 
73 
- 
25 
98 
Telangana 
- 
- 
- 
0 
Uttar Pradesh 
- 
- 
3,752 
3752 
Uttarakhand 
105 
- 
52 
157 
Total 
365 
130 
4,445 
4,940 

Sources: Lok Sabha Starred Question No. 466, December 1, 2021; PRS. 

12 Budget Speech, Union Budget 2021-22, https://www.indiabudget.gov.in/doc/Budget_Speech.pdf. 13 Sources and Application of National Small Savings Fund as on 31st March, 2022, Receipt Budget, Union Budget 2022-23, https://www.indiabudget.gov.in/doc/rec/annex8.pdf. 14 Finance Minister announces Rs 1.70 Lakh Crore relief package under Pradhan Mantri Garib Kalyan Yojana for the poor to help them fight the battle against Corona Virus, Press Information Bureau, Ministry of Finance, March 26, 2020. 

15 Starred Question No. 157, Lok Sabha, December 8, 2021, http://164.100.24.220/loksabhaquestions/annex/177/AS157.pdf.  
16 Cabinet approves extension of Pradhan Mantri Garib Kalyan Ann Yojana (PMGKAY) for another four months (December 2021-March 2022), Press Information Bureau, Cabinet, November 24, 2021. 17 Chapter 4, Volume I, Economic Survey 2019-20, Ministry of Finance, January 2020, https://www.indiabudget.gov.in/budget2020- 21/economicsurvey/doc/echapter.pdf. 18 Agriculture and Food Management, Chapter 7, Volume II, Economic Survey 2018-19, January 2019, https://www.indiabudget.gov.in/budget2019-20/economicsurvey/doc/vol2chapter/echap07_vol2.pdf. 19 Pricing, Overview of TPDS, Sales, Food Corporation of India, as accessed on January 21, 2022, https://fci.gov.in/sales.php?view=41. 20 Budget and Cost, Finance and Accounts, Food Corporation of India, as accessed on January 21, 2022, https://fci.gov.in/finances.php?view=109. 21 Report no. 15, Standing Committee on Food, Consumer Affairs and Public Distribution: 'Demands for Grants (2017-18), Department of Food and Public Distribution', Lok Sabha, March 2017, http://164.100.47.193/lsscommittee/Food,%20Consumer%20Affairs%20&%20Public%20Distribution/16_Food_Consumer_Affairs_And_P ublic_Distribution_15.pdf. 22 Chapter 4, Volume-I Main Report, 15th Finance Commission, October 2020 23 Chapter 7, Agriculture & Food Management, Volume-2, Economic Survey 2020-21, January 2021, https://www.indiabudget.gov.in/budget2021-22/economicsurvey/doc/echapter_vol2.pdf. 24 Report of the High Level Committee on Reorienting the Role and Restructuring of Food Corporation of India, January 2015, http://www.fci.gov.in/app2/webroot/upload/News/Report%20of%20the%20High%20Level%20Committee%20on%20Reorienting%20the% 20Role%20and%20Restructuring%20of%20FCI_English_1.pdf. 25 Third Report of the Standing Committee on Food, Consumer Affairs and Public Distribution: Demands for Grants 2015-16, Department of Food and Public Distribution, http://164.100.47.193/lsscommittee/Food,%20Consumer%20Affairs%20&%20Public%20Distribution/16_Food_Consumer_Affairs_And_P ublic_Distribution_3.pdf. 26 The Case for Direct Cash Transfers to the Poor, Economic and Political Weekly, April 2008, http://www.epw.in/system/files/pdf/2008_43/15/The_Case_for_Direct_Cash_Transfers_to_the_Poor.pdf. 27 Performance Evaluation of Targeted Public Distribution System, Planning Commission of India, March 2005, http://planningcommission.nic.in/reports/peoreport/peo/peo_tpds.pdf. 28 Report of the Expert Group to advise the Ministry of Rural Development in the methodology for conducting the Below Poverty Line (BPL) Census for 11th Five Year Plan, August 2009, https://rural.nic.in/sites/default/files/ReportofExpertGroupChaired-Dr.N.C.Saxena.pdf. 29 Role of the Public Distribution System in Shaping Household Food and Nutritional Security in India, NITI Aayog, December 2016. 30 12th Report, Strengthening of Public Distribution System - Augmenting Use of Technological Means and Implementation of  'One Nation, One Ration Card' Scheme, Standing Committee on Food, Consumer Affairs and Public Distribution, Lok Sabha, March 2021, http://164.100.47.193/lsscommittee/Food,%20Consumer%20Affairs%20&%20Public%20Distribution/17_Food_Consumer_Affairs_And_P ublic_Distribution_12.pdf. 31 S.O. 371(E), Notification, Ministry of Consumer Affairs, Food and Public Distribution, February 8, 2017, https://egazette.nic.in/WriteReadData/2017/174131.pdf. 32 Unstarred Question No. 1522, Rajya Sabha, Ministry of Consumer Affairs, Food and Public Distribution, December 10, 2021, https://pqars.nic.in/annex/255/AU1522.pdf. 33 S.O. 5314(E), Notification, Ministry of Consumer Affairs, Food and Public Distribution, December 20, 2021, https://egazette.nic.in/WriteReadData/2021/232018.pdf. 34 Justice K. S. Puttaswamy (Retd.) and Another vs Union of India and Others, W. P. (C.) No. 494 of 2012, https://main.sci.gov.in/supremecourt/2012/35071/35071_2012_Judgement_26-Sep-2018.pdf. 35 13th Report, Procurement, Storage and Distribution of Foodgrains by Food Corporation Of India, Standing Committee on Food, Consumer DISCLAIMER: This document is being furnished to you for your information.  You may choose to reproduce or redistribute this report for non-commercial purposes in part or in full to any other person with due acknowledgement of PRS Legislative Research ("PRS").  The opinions expressed herein are entirely those of the author(s).  PRS makes every effort to use reliable and comprehensive information, but PRS does not represent that the contents of the report are accurate or complete.  PRS is an independent, not-for-profit group.  This document has been prepared without regard to the objectives or opinions of those who may receive it. 

 
 