Is More Inclusive More Effective? The “New-Style” Public Distribution System in India

In September 2013, the Parliament of India enacted the National Food Security Act (NFSA), which entitles two-thirds of India’s population to 5 kg of rice, wheat, or coarse cereals per person per month at 1 to 3 Indian rupees (Rs) per kg. Foreshadowing the possible impact of this comprehensive reform provides the motivation for this paper. Five states in India—Andhra Pradesh, Chhattisgarh, Tamil Nadu, Odisha, and West Bengal—had already implemented somewhat similar changes in the targeted public distribution system (TPDS) a few years earlier using their own budgetary resources. They made rice—coincidentally, all five states are predominantly rice-eating—available in fair-price shops to a majority of their population at very low prices (less than Rs 3/kg). This paper tries to account for the changes in household consumption patterns associated with the change in PDS policy in these states using data from household consumption surveys by the National Sample Survey Organization (NSSO).

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South Asia Focus

Funded by UK DFID

This research has been funded by the UK Government’s Department for International Development; however the views expressed do not necessarily reflect the UK Government’s official policies

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