Public Distribution System in India

By Hemant Kumar|Updated : April 3rd, 2020

Public Distribution System(PDS) is a food Security System established under the Ministry of Consumer Affairs, Food, and Public Distribution by the govt. of India. It has evolved as a system of managing the scarcity of food by distributing food grains at affordable prices. The commodities like wheat, rice, sugar and kerosene are allocated to the States/UTs for distribution under PDS. Additional items of mass consumption such as pulses, edible oils, iodized salt, spices, etc are also distributed by some States/UTs through the PDS outlets. Both the Governments at Central as well as the States are jointly responsible for its operation. The Central Govt is responsible for procurement, storage, transportation and bulk allocation of food grains to the State GovernmentsIt is done with the help of Food Corporation of India (FCI). State Governments has the operational responsibilities like identification of eligible families, allocation within the State, issuance of Ration Cards and supervising the functioning of Fair Price Shops (FPSs) etc.

Public Distribution System in India: Evolution; Objectives; Functioning; Issues; Reforms and Way Forward

Evolution of PDS in India:

  • PDS was introduced during World War II as a war-time rationing measure. Before the 1960s, distribution of food grains through PDS was generally dependant on imports.
  • In the 1960s the government set up the Agriculture Prices Commission and the FCI to improve domestic procurement and storage of food grains for PDS. It was a measure taken by the govt. in response to the food shortages in India at that time.
  • PDS evolved into a universal scheme for the distribution of subsidised food by the 1970s. It was a general entitlement scheme for all consumers without any specific target until 1992.
  • Revamped Public Distribution System (RPDS) was launched by the Government in 1992. It helps to strengthen and streamline PDS and improve its reach in remote and inaccessible areas.
  • The Indian Government launched the Targeted Public Distribution System (TPDS) to focus on the poor in 1997. The beneficiaries were divided into 2 categories: Households below the poverty line or BPL and Households above the poverty line or APL.
  • Antyodaya Anna Yojana (AAY) was launched in 2000 to make TPDS aim at reducing hunger among the poorest segments of the BPL population.
  • The National Food Security Act, 2013 was enacted by the Parliament in 2013 to deliver food grains as legal entitlements to poor households. This makes the right to food a justiciable right.
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  • It helps to ensure Food and Nutritional Security in the nation.
  • System of minimum support price and procurement help to contribute to the increase in food grain production.
  • It helps in stabilising the food prices and making them available to the poor at affordable prices.
  • It also helps to maintain the buffer stock of food grains in the warehouse so that food remains available even during the period of less agricultural food production.
  • It helped in the redistribution of grains by supplying food from surplus regions of the country to deficient regions.


  • Both the Central and State Governments share responsibilities to provide food grains to the identified beneficiaries under PDS.
  • The centre govt. procures food grains directly from the farmers at a minimum support price (MSP) and sells it to various states at central issue prices. It is also responsible for the transportation of food grains to godowns in each state.
  • States has the responsibility of transporting food grains from these godowns to each fair price shop (ration shop) in the state. 
  • The beneficiaries buy the food grains at the lower central issue price from these fair price shops. Many states further subsidise food grains the prices before selling it to beneficiaries.


Issues Associated with PDS System in India:

  • The issue with procurement: All incoming grains are accepted even if buffer stock is filled, which creates a shortage in the market.
  • Leakage of food grains: TPDS suffers from leakages of food grains during transportation to and from the ration shops into the open market. Planning Commission in its report found 36% leakage of PDS rice and wheat at the all-India level. (Transportation leakages + Black Marketing by FPS owners)
  • Identification of beneficiaries: TPDS are prone to large scale inclusion and exclusion errors . This means that the needy beneficiaries do not get food grains while those that are ineligible are getting undue benefits.
  • Issues with storage: The CAG has revealed a serious shortfall in the government’s storage capacity of foodgrain in its performance audit of PDS.
  • Environmental issues: Overemphasis to attain self-sufficiency and a surplus in food grains has been found to be environmentally unsustainable as they are the water-intensive process. Procuring states like Punjab and Haryana are under severe environmental stress which includes rapid depletion of groundwater, deteriorating soil and water conditions from overuse of fertilisers. It was also found that because of the cultivation of rice in north-west India, the water table went down drastically in the region.
  • Due to Minimum support price (MSP) farmers divert land from production of coarse grains to that of rice and wheat which discourages crop diversification.

Reforms Undertaken by Government:

  • Adhaar Linked and digitization of ration cards: It allows online entry and verification of the beneficiary data and also enables online tracking of monthly entitlements and off-take of foodgrains by beneficiaries.
  • Direct Benefit Transfer scheme: Under the DBT scheme, the cash is transferred to the beneficiaries account in lieu of foodgrains subsidy component. They can buy food grains from anywhere in the market. Pre-requisites are complete digitization of beneficiary data and seed Aadhaar and bank account details of beneficiaries for taking up this model.
  • Computerized Fair Price Shops: It is done by installing a ‘Point of Sale’ device to swap the ration card. This helps to authenticate the beneficiaries and records the quantity of subsidized grains given to a family.
  • Use of web-based citizens portal: as a Public Grievance Redressal Machineries which includes support mechanisms like a toll-free number for call centres in order to register complaints or suggestions.
  • Use of GPS technology: GPS technology can be used to track the movement of trucks carrying foodgrains can help to prevent diversion.
  • SMS-based monitoring: It allows monitoring by citizens themselves as they can register their mobile numbers and send or receive SMS alerts during dispatch and arrival of TPDS commodities.

Way Forward:

  • Public Distribution System(PDS) is one of the biggest welfare programmes of the government which helps farmers to sell theirs produces at remunerative prices. It also helps the poorer sections of society to buy food grains at affordable rates.
  • Its effectiveness can be enhanced by technology-based solutions.
  •  Shifting towards Direct Benefits Transfer(DBT) is another idea, but with caution. Reserve Bank of India in its report on State finances has advised States that are planning to shift to cash transfer to be more cautious.
  • Computerization of the whole process will bring transparency in the process. It can help to prevent leakages and diversion of food grains to a great extent.
  • Bio-fortified foods should be distributed through the PDS to enhance the nutritional level of masses. This will make it more relevant in the backdrop of prevalent malnutrition in India.
  • Efforts to plug leakages is also the need of the hour.  
  • Capacity building and training of all the implementing authorities can help in strengthening the existing TPDS system. It can be further strengthened by increasing public participation through social audits.
  • Participation of SHGs, Cooperatives and NGOs can help in ensuring the transparency of the PDS system at ground level.

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