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National Food Security Act of India, 2013A Compendium

National Food Security Act of India, 2013A Compendium

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First published: February 2014

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Contents

Preface ........................................................................................................................................ i

Acknowledgement ..................................................................................................................... v

Section I: Pre-enactment of the National Food Security Act of India

1. A Grain of Good Sense: Legislation against Hunger is aGreat Idea that Needs Expansion ........................................................................................ 3Jean Dreze, Outlook, July 20, 2009

2. The Food Economy: How will the Government Reach Food to the Target Families? .......... 5Bhaskar Dutta, The Telegraph, July 30, 2009

3. Pathway to Food Security for All......................................................................................... 7M.S. Swaminathan, The Hindu, March 29, 2010

4. Differences Persists in Government over Food Bill Impact on Open Market Prices............ 10Prabha Jagannathan, The Economic Times, August 10, 2011

5. Punjab may Make Going Tough for Food Bill ................................................................... 12Urmi A Goswami, The Economic Times, February 01, 2012

6. Food Security Bill will Benefit Multinational Corporations and Hurt Genuine Traders ..... 13Tejinder Narang, The Economic Times, February 02, 2012

7. Panel Suggests 5kg of Subsidised Grain to 67% of Population .......................................... 15Financial Express, January 17, 2013

8. Pass Food Bill even Without Amendments......................................................................... 17Amartya Sen, The Hindu, May 07, 2013

9. Food Security: For Poor�s Sake, Jholawalas must Speak Up............................................... 18Akshaya Mishra, Firstpost, June 14, 2013

10. Exclusion as Policy ............................................................................................................ 20T.K. Rajalakshmi, Frontline, July 12, 2013

11. Food Security: Only Two Congress States Ready .............................................................. 23Iftikhar Gilani, Daily News and Analysis, July 14, 2013

12. PDS: A Story of Changing States ....................................................................................... 24Himanshu, Mint, August 05, 2013

13. The National Food Security Ordinance: Five Misconceptions ........................................... 26Reetika Khera, Ideas For India, August 07, 2013

14. Food Security Bill to Provide Food and Nutritional Security inHuman Life Cycle Approach ............................................................................................. 29K V Thomas, Odisha Diary, August 13, 2013

15. Why Food Security Bill Makes Economic Sense................................................................. 33Arun Kumar, Hindustan Times, August 20, 2013

16. We�ll Meet Foodgrain Requirement under FSB ................................................................. 35Sandip Das, The Financial Express, August 21, 2013

17. Food Security Bill: Why Blame the Poor and the Hungry? ................................................. 38Harsh Mander, Live Mint, August 26, 2013

18. Truth vs Hype: Who�s Afraid of the Food Security Bill? .................................................... 40Sreenivasan Jain, NDTV, September 03, 2013

19. The Food, the Bad and the Ugly ........................................................................................ 43P Sainath, The Hindu, March 22, 2012

20. Let us not Rush into Cash Transfers ................................................................................. 46The Hindu Business Line, December 27, 2012

21. Thomas for Private Help in India�s Foodgrain Procurement .............................................. 48Business Standard, April 04, 2013

22. Food Security Ordinance � Analysis and Recommendations.............................................. 50Byomkesh Lal, Note by ActionAid, August 06, 2013

Section 2: Post-enactment of the National Food Security Act of India

23. Food Disaster Waiting to Happen ..................................................................................... 57K D Singh, The Pioneer, September 23, 2013

24. North-eastern States Plead Inability to Roll Out Food Law ............................................... 59Gargi Parsai, The Hindu, November 10, 2013

25. Food Subsidies Need Protection from Coercive WTO Rules: Sharma ................................ 60Puja Mehra, The Hindu, November 21, 2013

26. India Rejects WTO Peace Clause Proposal ........................................................................ 61Puja Mehra, The Hindu, November 23, 2013

27. Hungry for Change ........................................................................................................... 62The Hindu, November 24, 2013

28. Ambitious Agenda for Food Security ................................................................................. 64Sandeep Kandicuppa, HIMAL South Asian, November 27, 2013

29. India not to Compromise on Food Security: Sharma ......................................................... 70The Hindu, December 02, 2013

30. India has its Way at WTO on Food Plan ........................................................................... 71Sidhartha, The Times of India, December 07, 2013

31. Application Process for Food Security Card Resumes ........................................................ 73Vishal Kant, The Hindu, December 21, 2013

32. Food Security Act: Should Centre Emulate Chattisgarh?-YES ........................................... 74Reetika Khera, The Hindu, December 28, 2013

33. India�s Plan to Feed 800 Million People is Either Amazing or Insane................................. 75Krista Mahr, Time World, January 13, 2014

34. Prez Bats for New Tech in Farming ................................................................................... 76The Times of India, January 20, 2014

35. Sustainability and Food Security ....................................................................................... 77Nilanjan Ghosh, The Hindu Business Line, January 20, 2014

36. Subsidies for Beneficiaries as Karnataka & Chhattisgarh Implement NFSA ...................... 79FnBnews, January 20, 2014

37. Centre�s Welfare Plans may Strain Finances of States: RBI Study ...................................... 80Economic Times, January 24, 2014

38. The National Food Security Act vis-à-vis the WTO Agreement on Agriculture ................. 81Sudha Narayanan, Economic & Political Weekly, February 01, 2014

Exhibits

Exhibit 1: The National Food Security Bill, 2011Right to Entitlement to Food and Nutrition ........................................................... 93

Exhibit 2: From Bill to Act: A Brief Overview ....................................................................... 101

Exhibit 3: National Food Security Act of India, 2013 ............................................................ 119

Preface

Ensuring food security in a large and diverse country like India is of great importance wherealmost one-third of its population is estimated to be absolutely poor and one-half of all children

malnourished in one way or another. In the past there have been many attempts to deal with all thedimensions of the food insecurity via programmes and schemes pertaining to subsidised ration tovulnerable sections of the population, care and support to destitute and homeless, special entitlementto women, etc.

However, in spite of all the provisions in place, there has been very little that the country couldachieve in tackling the problem of hunger and malnutrition as faced by its people. This called for anew approach to tackle food insecurity which is not only enforceable but also legally entitles itspeople to one of their basic human rights, that is the Right to Food.

The National Food Security Act of India, 2013 is the result of such necessity for changing thenutritional and hunger status of India. Although the Act derives its relevance from the Constitutionof India (Article 47) and the Universal Declaration of Human Rights and the International Covenanton Economic, Social and Cultural Rights to which India is a signatory but still it has been debated onalmost all the fronts. It is an overarching act covering multiple welfare schemes and programmes ofthe government for ensuring food security in India.

The Origin of the ActThe Right to Food Campaign in India sowed the seed for this gigantic redistributive mechanism.

The conceptualisation of the Act derives its origin from deeper debate that followed the writ petitionfiled by the Rajasthan Unit of the People�s Union for Civil Liberties in the Supreme Court of India inApril 2001 demanding that the country�s food stocks to be used to alleviate hunger and malnutrition.

The official announcement of the National Food Security Act came on 4th June, 2009, from Smt.Pratibha Devisingh Patil, the then President of India, in her address to the Members of both theHouses of Parliament, where she announced that �A new Act - the National Food Security Act - willbe enacted to provide a statutory basis for a framework which assures food security for all andentitle by law, every below poverty line family to 25kg per month of rice or wheat at Rs.3 per kg�.

The first draft of the National Food Security Bill was submitted by the National Advisory Councilin 2010, which was revised, incorporating comments and amendments from the expert committeesand parliamentary standing committee on the Bill. On 10th September 2013, the Parliament of Indiapassed bill, enacting the National Food Security Act of India, 2013.

Some salient features of the National Food Security Act of India, 2013 are as follows:� It gives right to subsidised food grains to 67 per cent of India�s 1.2 billion people and provides

for penalty for non-compliance by public servants.� 75 per cent of rural and 50 per cent of the urban population are entitled to 5kg of food grains

per month at Rs.3/2/1 per kg for rice/wheat/coarse grains, respectively.� Pregnant women and lactating mothers are entitled to nutritious meals and maternity benefit

of at least Rs. 6,000 for six months.� The Central government will provide funds to states in case of short supply of food grains.� The state governments will provide food security allowance to the beneficiaries in case of non-

supply of food grains.

National Food Security Act of India, 2013 i

� Public distribution system is to be reformed.� There will be state and district level redress mechanisms.

Debating the ActThe National Food Security Act of India, 2013, has been debated widely not only in the public

forum but also within the political and bureaucratic arena of the country. The range of argumentshas covered almost all the aspects of the Act and interestingly the arguments have been shaped inboth for and against strongly on each one of the dimensions of the act. In December 2011, theNational food Security Bill was taken up by the Parliament, in pursuance of electoral promises madeby the United Progressive Alliance government.

The following three major aspects of the Act were widely debated in public.

Economics of food securityOn the economic viability of the Act, there is a lobby of experts, policy makers, and public in

general who were of the opinion that it is not economically viable, especially in the light of thecurrent fiscal deficit that the country is facing. The implementation of this act will further proveharmful for the financial health of the economy. On the other hand, there are opinions voiced forthe importance of this Act to in order to ensure a more healthy population, which is economicallymore rewarding in the long run.

Public distribution system and redistribution of food grainsOne of the most controversial aspects of the Act is that it sets the public distribution system as

one of the most important pillars over which the Act is to stand. The controversy gets aired from theinefficiencies existing in the PDS and targeted PDS at present where it failed to benefit the poor withsubsidised ration, and instead led towards channelling allocated ration to the open market throughblack marketing channels.

Many experts have expressed their apprehensions on the effectiveness of the PDS system inachieving the intended benefits that are aimed by the Act. However, there are experts who pointtowards the �glass which is half full�, stating the improvements that have been carried out by some ofthe states in their respective PDS system resulting in higher benefits to the intended population andlimiting the leakages in the system to as minimum as 10 to 15 per cent. The most notable statesamong them are Chhattisgarh and Bihar � two poorest states of India.

Welfare vs. right-based approachThe Commission on Agricultural Costs and Prices of the Ministry of Agriculture, Government of

India has referred the Act as the �biggest ever experiment in the world for distributing highly subsidisedfood by any government through a right-based approach�. It extends the coverage of the targetedpublic distribution system, India�s principal domestic food aid programme, to two-thirds of itspopulation or approximately 820 million people.

In spite of all the criticism it faced from many fronts ranging from social feasibility to economicviability, it has given some hope to the poor and vulnerable sections of the population for ensuringbetter food security. The legal entitlement will change the system from the demand side of theequation as much expected by the experts.

From Bill to ActFrom 2009, when it was first announced, till 2013 when the Bill was finally enacted, it has gone

through many amendments at every step of its progress. In this compendium, we have done ananalysis of major amendments. Some salient features of the Bill and corresponding provisions in theAct are presented in the following table.

ii National Food Security Act of India, 2013

The debate on this Act has ranged from economic to social to political aspects it covered. Thiscompendium attempts to cover several major aspects of this Act as debated in public - before andafter its enactment. It is to help readers to enhance their understanding on different aspects of theNational Food Security Act of India. It has tried to cover various dimensions of this debate � both forand against � without tempering or tilting towards any one side of the opinions. It will be a usefulreference as the Act is implemented and will help in future debates on implementation issues.

Bipul ChatterjeeDeputy Executive Director

CUTS International

Salient Features

Foodentitlement

Entitlementsfor women andchildren

Special groups

Householdcoverage

RedressalMechanism

National Food Security Bill

Every person belonging to priorityhouseholds and general households,shall be entitled to receive every monthfrom State Government, under TPDS, 7kg of food grains per person per monthfor priority households and not less than3 kg per person per month for generalhouseholds at subsidised price.

Maternity benefit of Rs. 1,000 permonth for a period of six month inaccordance with a scheme, includingcost sharing, payable in instalments asprescribed by central government

Daily, free cooked meal for destitutepersons; Community kitchens (subjectto successful pilots) for homelesspersons and urban poor; Unconditionalprotection from starvation

The Bill itself does not specify thecriteria for categorisation of thepopulation into priority and generalhousehold and also does not specifies asto how the priority and generalhouseholds will be identified.

The Bill states that the centralgovernment and the state governmentsshall put in place an internal grievanceredressal mechanism which may includecall centres, help lines, designation ofthe nodal officers, or such othermechanism as may be prescribed by therespective governments.

National Food Security Act

Incorporating recommendation from theParliamentary Standing Committee Reportand many other analytical reportsincluding that of CUTS International(Exhibit 1), the National food Security Acthas made uniform legal entitlement of 5Kg for all the groups of the householdscovered under the Act.

Every pregnant and lactating mother isentitled to a free meal at the localanganwadi (community centre) duringpregnancy and six months after child birthas well as maternity benefit of Rs. 6,000 insuch instalments as may be prescribed bythe Central government.

The clause relating to the �special groupsconsisting of all destitute persons orhomeless persons have been deleted fromthe National Food Security Act, 2013.

The Act does not specify criteria for theidentification of households eligible forPDS entitlements. The central governmentis to determine the state-wise coverage ofthe PDS. The identification of eligiblehouseholds is left to state governments,subject to the guidelines of �AntyodayaAnna Yojana� scheme and as per newguidelines to be �specified� by the stategovernments for priority households.

The responsibility of establishing theinternal grievance cell has been completelyshifted to the state governments as againstthe shared responsibility between centreand the states as per the Bill.

National Food Security Act of India, 2013 iii

Acknowledgement

This compendium on the National Food Security Act of India, 2013 aims to be a resourcefulreference document for understanding multiple dimensions of this comprehensive act. It has

sought to bring together different point of views over this much debated act of India.It contains copyrighted material whose use has not been specifically authorised by the copyright

owners. Consumer Unity & Trust Society (CUTS International) is making these articles available inan effort to advance understanding of the National Food Security Act of India, 2013. We believethis constitutes a �fair use� of the copyrighted material as provided for in Article 10 of the BerneConvention for the Protection of Literary and Artistic Works (Paris Text 1971) and in Section 107of the US Copyright Law. If anybody wishes to use material from this publication for purpose thatgo beyond �fair use�, s/he must obtain permission from the copyright owner. CUTS Internationalwill not draw any profit from this publication, since it solely for informative and educational purposes.

The articles have been obtained from the following sources:� Outlook� The Telegraph� The Hindu� Economic Times� The Financial Express� First Post� Frontline� DNA� Mint� Ideas for India� Odisha Diary� Hindustan Times� NDTV� Business Line� Business Standard� Note by Action aid� The Pioneer� HIMAL South Asian� The Times of India� Time World� FnBnews

National Food Security Act of India, 2013 v

Section I

Pre-enactment of theNational Food Security Act

of India

National Food Security Act of India, 2013 3

1A Grain of Good Sense: Legislation against

Hunger is a Great Idea that needs ExpansionJean Drez*

Outlook, July 20, 2009

The budget reiterates the government�scommitment to a National Food Security

Act, known as the �right to food� law. In principle,this is welcome. Our under nutrition levels areamong the worst in the world and have barelyimproved in recent years. Such a law could helpfocus the nation�s energies on this burning issue.

In India, hunger and malnutrition have deeproots, not only in economic insecurity but alsolack of education, gender inequality, socialdiscrimination, skewed property rights and lackof basic amenities.

Serious commitment to the right to foodwould call for action on all these fronts. Theproposed act is unlikely to provide a blanketsolution but could make a big difference if it takesa broad view of the problem.

It�s especially important not to conflate theproposed act with the Congress promise of 25kg of grain every month at Rs 3 a kilo for BPLfamilies. Indeed, this happens to be little morethan a repackaging of the current BPLentitlements, with less quantity at a lower price.Further, good nutrition depends not only onaccess to cheap grain but also on other inputs,such as good food, childcare, clean water andbreastfeeding support. A serious right tofood law should ensure these needs are alsoaddressed.

The NREGS is already a step towards the rightto food. However, its implementation is erraticand the principle of �work on demand� isnowhere near being realised. Some families areunable to participate in it because of ill health orold age. This is why the right to food law mustinclude the provision of cheap grain under thePDS beyond the timid promise of �25 kg at Rs 3per kilo�.

The current quota of 35 kg per month shouldnot be reduced; ideally, the PDS should beuniversal in order to avoid the inevitableexclusion errors of any targeted system. But ifwe go for a targeted system, the selection of BPLfamilies should be transparent and verifiable. Andit must cover, say, at least 50 percent of thepopulation. Some marginalised groups, such asSC/ST families in rural areas, should have BPLcards as a matter of right.

Second, special PDS entitlements are requiredfor the most vulnerable families, including thosein which no adult member is able to participatein the labour market. Such entitlements alreadyexist for some such families under the AntyodayaAnn Yojana programme. This programme shouldbe expanded under the proposed act. Anotherform of social assistance that works relativelywell is that of cash pensions � like old agepensions and widow pensions. This is a natural

* An Honorary Professor, Delhi School of Economics and Visiting Professor, Department of Economics, AllahabadUniversity

Legislating against hunger is a great idea that needs expansion

4 National Food Security Act of India, 2013

complement to food-based assistance under theAntyodaya programme. An integrated pensionprogramme could form a third pillar of theproposed act.

A fourth crucial component is directnutritional support for children. School-goingchildren are already entitled to nutritious mid-day meals under recent orders of the SC; theseentitlements should be consolidated under theproposed act, along with provisions for schoolhealth services.

Similarly, for younger children, SC ordersrelating to the ICDS should be incorporated inthe right to food law. Under these orders, allchildren under six years are entitled to all basicICDS services � nutrition, healthcare and pre-school education. In fact, the SC directed thegovernment to ensure that this happens by

December 2008. The finance minister�s statementthat the ICDS would be universalised by 2012 isa step backward in this respect. Whatever thebudget may have in store for the �aam admi�,it�s a damp squib for �aam bacche�.

This is a minimum list of interventions thatneed to be included in the law if it has to have aserious impact on India�s �nutritionalemergency�. Other provisions to consider arematernity entitlements, breastfeeding support,rehabilitation of severely malnourished childrenand community kitchens in urban areas. Theseentitlements must be backed by adequate fundsand strong grievance redressal systems. Perhapsthis is a tall order. But India has already set anoutstanding example of bold social legislationwith the NREGS � it can be done again with theRight to Food Act.


2The Food Economy: How will the Government

Reach Food to the Target Families?Bhaskar Dutta*

The Telegraph, July 30, 2009

Residents of Delhi typically hate heavydownpours. Despite the annual claims of the

Municipal Corporation that they have cleanedall rainwater pipes, Delhi�s streets get floodedevery time it rains. This year, Delhi�s reaction todownpours has been unusual. It rained fairlyheavily a couple of days ago, forcing cars to crawlalong flooded streets. Nevertheless, we are alllooking forward to more showers in order to getsome respite from the sweltering heat.

Farmers in the northwest and several otherparts of the country are waiting for torrentialrains even more anxiously. This year�s monsoonhas been conspicuous by its absence � the latestestimate from the meteorological department isthat the deficiency in rainfall has been as muchas 19 percent. Despite quite large investments inagriculture over the years, irrigation facilitiesremain limited, and much of Indian agricultureremains dependent on adequate rainfall.

So, the inadequate rainfall will ensure that thisyear�s kharif or summer-sown crop output willbe much less than the output produced last year.Of course, the effect will not be uniform. Inparticular, the planting of rice and sugarcane hasbeen lagging far behind the levels last year, whilethe wheat output, which is less dependent onrainfall, will be almost �normal�.

This has given rise to apprehensions that theshortfall in agricultural output this year mayresult in an increase in food prices. The possibility

of a rise in food prices sends alarm bells ringingin government circles because even a slight risein the price of basic food items puts thegovernment on the defensive. It must appear totake firm and decisive steps to control anyincrease in food prices. Perhaps this explains thegovernment�s decision to ban the export of wheatand non-basmati rice through diplomaticchannels.

While the private export of wheat and non-basmati had been banned long ago, the previousUnited Progressive Alliance government hadearlier decided to allow the export of 2 milliontonnes each of wheat and non-basmati rice togovernments of developing countries essentiallyas a gesture of goodwill. Obviously, domesticpressures have been given higher priority thanbrownie points earned from foreign governments.

The latest ban on food exports is more of aknee-jerk reaction rather than a measuredresponse to any impending crisis. We now havea comfortable buffer stock of food grains in thecountry. By the agricultural minister�s ownreckoning, these stocks are enough for 13months� consumption. This suggests that theoverall food situation is quite comfortable. Thegovernment can control the retail price offoodgrains by releasing sufficient quantity fromits burgeoning stocks. Having said that, a wordof caution is also in order. Prices of pulses maywell go up if output dips alarmingly during the

* Professor, University of Warwick, (2000- ), and Distinguished Visiting Professor, Indian Statistical Institute, Delhi(2006-)


course of this year since the government does nothold sufficiently large stocks of these items.

Of course, we also need to consider theimplications of the government�s decision toimplement a �Right to Food Act� on the foodeconomy of the country. President PratibhaPatil�s inaugural speech mentioned thegovernment�s intention to provide each below-the-poverty-line family with 25 kg of foodgrainsa month at Rs 3 per kg. This pledge was reiteratedduring Pranab Mukherjee�s budget speech. It isnot clear when the act will actually be presentedin Parliament, at least partly because there is somecontroversy about whether the �right to food�should be narrowly defined to include justfoodgrains alone. Many social activists would liketo give a very broad meaning to the right to food,including within it food items other than justgrain, childcare and clean drinking water. But,hopefully, the government and its critics will soonarrive at a workable definition of the right tofood, and the BPL families will soon be issuedtheir quota of food at subsidised prices. This willundoubtedly result in an increase in the aggregatedemand for food. However, even this need notworry the government unduly given the stock offoodgrain available in the country.

The main problem once this act comes intobeing lies elsewhere. How will the governmentensure that the foodgrains reach the targetfamilies? What is the delivery mechanism? Thiswill pose the biggest challenge to the government.Apart from some stray articles, there has not beenany discussion at all about the pros and cons ofdifferent delivery mechanisms. This is all the moresurprising since the Right to Food Act, inwhatever form, promises to be one of the mostimportant redistributive schemes ever adopted inthis country.

This virtual silence suggests, at least implicitly,that the government has already decided to rely,

more or less completely, on the publicdistribution system. The PDS has becomesomething of a sacred cow, with many peopleeven refusing to consider that there can becredible alternatives to the PDS. Unfortunately,this view completely ignores the shortcomings ofthe PDS � of which there are many.

For instance, large sections of poor householdsdo not benefit at all from the PDS � even fromthe targeted PDS whose principal beneficiariesare supposed to be the BPL families. Fairly largefractions of BPL families do not purchase anyfoodgrains from the PDS. This is due to acombination of factors. In the north and east,limited geographical coverage is the principalculprit. In other areas, there are institutionalbarriers such as the need to prove residence andbuy ration entitlements only once a fortnight, thelatter being difficult for BPL families.

There is also a huge cost of providing subsidiesto the poor through the PDS. Indeed, someestimates suggest that it may cost the governmentmore than three rupees to provide a rupee ofsubsidy to the target households.

The system of food stamps provides analternative to the PDS. Under this scheme, thegovernment issues coupons to the target families.These coupons can then be redeemed at any shopfor specified quantities of foodgrains at stipulatedprices. The effectiveness of food stamps obviouslydepends on how efficient it is in deliveringfoodgrains to the consumers relative to the PDS.There are good reasons to believe that the systemof food stamps may be better than the PDS.

For instance, there cannot be any chance ofillegally diverting grains to the open market.Procurement and storage costs are alsosubstantially higher in the PDS. All this suggeststhat the government experiment with this systemin some areas.


3Pathway to Food Security for All

M.S. Swaminathan*

The Hindu, March 29, 2010

In his latest budget speech, Finance MinisterPranab Mukherjee announced: �We are now

ready with the draft Food Security Bill which willbe placed in the public domain very soon.�Although no official draft has been madeavailable as yet, several organisations andindividuals have questioned the adequacy of thesteps proposed to be taken under the Act toachieve the goal of a hunger-free India. Based onArticle 21 of the Constitution, the Supreme Courthas regarded the right to food as a fundamentalrequirement for the right to life.

Many steps have been taken sinceIndependence to adopt Mahatma Gandhi�sadvice for an antyodaya approach to hungerelimination. In spite of numerous measures andprogrammes, the number of undernourishedpersons has increased from about 210 million in1990-92 to 252 million in 2004-06. India hasabout half the world�s under-nourished children.Also, there has been a general decline in per capitacalorie consumption in recent decades. Grainmountains and hungry millions continue to co-exist.

Fortunately, we are moving away from apatronage-based to a rights-based approach inareas relating to human development and well-being. Acts relating to the Right to Information,Education, Land for Scheduled Tribes and Forest

Dwellers, and Rural Employment are examples.The Food Security Bill, when enacted, willbecome the most important step taken since 1947in addressing poverty-induced endemic hungerin India. The impact of under-nutrition on healthand productivity is well known.

Numerous programmes have been introducedby the Government of India from time to time toimprove nutritional status. Under the Ministryof Women and Child Development these areIntegrated Child Development Services (ICDS),the Kishori Shakti Yojana, the NutritionProgramme for Adolescent Girls, and the RajivGandhi Scheme for Empowerment of AdolescentGirls. Under the Ministry of Human ResourceDevelopment come the Mid-day MealsProgramme and the Sarva Siksha Abhiyan. TheMinistry of Health and Family Welfare has theNational Rural Health Mission and the NationalUrban Health Mission.

The Ministry of Agriculture has come forwardwith the Rashtriya Krishi Vikas Yojana, theNational Food Security Mission and the NationalHorticulture Mission. The Ministry of RuralDevelopment has initiated the Rajiv GandhiDrinking Water Mission, the Total SanitationCampaign, the Swarna Jayanthi Gram SwarajgarYojana, and the Mahatma Gandhi NationalRural Employment Guarantee Programme. The

* Emeritus Chairman and Chief Mentor, Centre for Research on Sustainable Agriculture and Rural Development

The proposed Food Security Bill should adopt a three-prongedstrategy that constitutes a Universal Public Distribution System for

all, low-cost foodgrains to the needy, and convergence in thedelivery of nutrition safety net programmes


Ministry of Food has introduced the TargetedPublic Distribution System, the Antyodaya AnnaYojana, and Annapoorna.

In spite of such an impressive list, the situationin the field of child nutrition remains bleak. Thepercentage of children below five years of agewho are underweight is now 42.5 percent. Thepercentage of children below three years who areundernourished is 40 percent.

To ensure food security for all, we should beclear about the definition of the problem, theprecise index of measuring impact and the roadmap to achieve the goal. Today, the discussionmainly centres on the definition of poverty andmethods to identify the poor. India has the mostausterely defined poverty line in the world andthe official approach appears to be to restrictsupport to BPL families. The number of BPLfamilies calculated (taking four persons as theaverage size of a family) varies from 9.25 crore(Suresh Tendulkar Committee) to 20 crore(Justice D.P. Wadhwa).

Food security, as internationally understood,involves physical, economic and social access toa balanced diet, safe drinking water,environmental hygiene and primary health care.Such a definition will involve concurrent attentionto the availability of food in the market, theability to buy needed food and the capability toabsorb and utilise the food in the body. Thus,food and non-food factors (that is, drinkingwater, environmental hygiene and primary healthcare) are involved in food security.

In addition to the Central government schemesdealing with nutrition support, drinking water,sanitation and health care, most Stategovernments have schemes such as extendingsupport to mothers to feed newborns withmothers� milk for at least the first six months.Tamil Nadu and Kerala have universal PDS.Unfortunately, the governance of the delivery ofsuch programmes is fragmented; a �deliver asone� approach is missing.

A life-cycle approach starting with pregnantwomen and ending with old and infirm personsis lacking in the development and delivery ofnutrition-support programmes. India�sunenviable status in the field of nutrition is largelybecause of the absence of a good governancesystem that can measure outlay and output in an

unbiased manner. Therefore, more than newschemes the governance of existing schemes needsattention.

The National Food Security Bill should be sostructured that it provides common anddifferentiated entitlements. The commonentitlements should be available to everyone.These should include a universal publicdistribution system, clean drinking water,sanitation, hygienic toilets, and primaryhealthcare. The differentiated entitlements couldbe restricted to those who are economically orphysically handicapped. Such families can beprovided with wheat or rice in the quantitydecided at Rs.3 a kg, as is being proposed.

Even to BPL families, the availability of cheapstaple grain will only help address the problemof access to food at an affordable price, but noteconomic access to a balanced diet. At theprevailing price of pulses, such families will nothave access to protein-rich foods. Similarly,hidden hunger caused by the deficiency of micro-nutrients such as iron, iodine, zinc, vitamin Aand Vitamin B12 will persist. The question thenis: what do we want to achieve from the FoodSecurity Bill? Should it enable every child, womanand man to have an opportunity for a healthyand productive life, or just have access to thecalories required for existence? If the aim is thelatter, the title �Food Security Bill� will beinappropriate.

Brazil�s �Zero Hunger� programme takes aholistic view of food security. The measuresinclude steps to enhance the productivity of smallholdings and the consumption capacity of thepoor. Our farmers will produce more if we areable to purchase more. Emphasis on agriculturalproduction, particularly small-farm productivity,will as a single step make the largest contributionto poverty eradication and hunger elimination.

While universal PDS should be a legalentitlement, the other common entitlements couldbe indicated in the Bill for the purpose ofmonitoring and integrated delivery. This will helpfoster a �deliver as one� approach. Theinvolvement of gram sabhas and nagarpalikas inmonitoring delivery systems will improveefficiency and curb corruption.

What is desirable should also beimplementable. The greatest challenge in


implementing the common and differentiatedfood entitlements under the Bill will be theproduction of adequate quantities of staple grain.The untapped production reservoir, even with thetechnologies now on the shelf, is high in irrigatedand rain-fed farming systems. Doubling theproduction of rice and wheat in eastern India andpulses and oilseeds in rain-fed areas is feasible inthis decade.

The 2010-11 budget indicates measures toinitiate a �bridge the yield gap movement� ineastern India, and stimulate a pulses and oilseedsrevolution through the organisation of 60,000Pulses and Oilseed Villages. Here, concurrentattention will be given to conservation of soil andwater, cultivation of the best available strains,consumption of local grain and commerce atprices that are fair to farmers. National and Stateefforts should be supported at the local body levelto build a community food security systeminvolving seed, grain and water banks.

The National Commission on Farmers (2006),in its recommendations on building a sustainablenational nutrition security system, calculated thatabout 60 million tonnes of foodgrains will beneeded to sustain a universal PDS. Thedifferentiated entitlements for BPL families for

foodgrains at low cost will involve only additionalcash expenditure. In fact, food stocks with thegovernment may touch 60 million tonnes by June2010.

For the government to remain at thecommanding heights of such a food securitysystem combining universal and uniqueentitlements, the four-pronged strategy indicatedin Mukherjee�s budget speech should beimplemented jointly by panchayats, Stategovernments and Union Ministries speedily andearnestly.

Just as the Golden Quadrilateral initiative ofthe Atal Behari Vajpayee government electrifiedthe national road communication infrastructure,we need a �golden quadrilateral� in thedevelopment of a national grid of modern grainstorages. Will Manmohan Singh, too, leave hisfootprints on the sands of time by taking stepsto ensure the safe storage of foodgrains andperishable commodities as an essentialrequirement for food security?

India should not lose this historic opportunityto ensure that it takes to a development pathwaywhich regard to the nutrition, health and well-being of every citizen as the primary purpose ofa democratic system of governance.


4Differences Persist in Government over

Food Bill Impact on Open Market PricesPrabha Jagannathan*

The Economic Times, August 10, 2011

Sharp differences persist in the governmentover whether and how much of an impact the

impending food law is likely to have on openmarket food prices. At a time when input costsfor farmers have already gone up significantlyand threaten volatility in food prices, the foodministry has dismissed apprehensions voiced byCommission for Agricultural Costs and Prices(CACP) chairman Ashok Gulati on the issue.

Food Minister K V Thomas dubbed thedifference between marketable surplus in grainsand the total production as �marginal�. Thedifference between the two is a key criterion fordeciding the price and demand-supply equationsin the open market. Food ministry officials assert,however, that the food law will be �scaleneutral.� However, Gulati, reacted by reiteratinghis apprehensions on open market prices offoodgrain and an availability crunch in droughtyears.

Speaking to ET, he stressed that thegovernment will also have to boost its strategicbuffer norm, in tandem with increased welfarecommitment to 10mt, i.e., double its current level.

He pointed out that support prices for keycrops, would have to go up exponentially thisyear in view of higher input costs, althoughmeeting �full production costs� for crops would�remain a major challenge.� In view of that, theoperational costs for the food law would also goup manifold.

But, he added, �I have no worries on how theneeds of the food law will be met for the firstyear or two, given the huge stocks available withthe government now.� Compared to stocks ofonly 19mt by the July 1 quarter in 2006, thegovernment had 64mt this July 1.

�There is very little difference between thetwo. Any significant impact is unlikely becausethe law is not procuring to store but procuringto release into the market and cool down pricesfor both priority and the general category. If thelatter, who have been procuring from the openmarket, find prices high, they will access grainfrom the food law allocation at lesser price tomake up their food grain needs.

We are currently procuring 55mt of grain forwelfare and PDS programmes. For the food law,we will be procuring 61mt, which is only amarginal increase in buys. The price or supplyimpact will be neutralised since 48 percent ofrural (75 percent of the rural poor) and 28percent of urban population will be covered. Thelaws of demand and supply will act to make thefood law scale neutral,� a senior ministry officialsaid.

Quite contradictory to the food ministry�scontention on marketable surplus of grain, thefarm ministry�s Agricultural Statistics at A Glanceregisters marketable surplus of grain as aproportion of total production in states. In thethree year period between 2005 and 2008,

* Journalist, The Economic Times


marketable surplus of rice was 74.35% of totalproduction and for wheat, it was 60.95% of thetotal production, the publication says.

Gulati, co-author of a key IFPRI study gaugingthe impact of the food law on open market pricesof grains and the participation of the privatesector in grain buys (reported first in ET May11) released earlier this year, pointed out, �Evenpriority consumers have to depend currently onthe open market for around 5kgs of grain perperson, over and above the 7 kgs per person thatthe food law will accommodate.

As for the general category, high value riceforms only a small proportion of totalproduction. If the law doles out 3kg/person, thatwill mean that 8 kgs will have to be accessed fromthe open market. Logically, prices should go upwith increased demand. If that happens, thepressure will increase on the food law allocations.If there is only one bucket of water available andmost of that is with the government, obviously,the demand from that will intensify, and the pricefor what�s available outside will go up.


5Punjab may Make Going

Tough for Food Security BillUrmi A Goswami*

The Economic Times, February 01, 2012

The Centre�s National Food Security Bill couldface some hitches, irrespective to which party

forms government in Punjab as both theCongress and Akali Dal-BJP have promised todiversify agricultural production by movingtowards cash or commercial crops.

The poll promise by political parties toinfluence Punjab farmer to also grow crops otherthan wheat and paddy gives further weight toagriculture minister Sharad Pawar�s warning thatimplementation of food security law would bedifficult unless agricultural productivityimproves.

�Solution is that unless and until we increaseproduction, we will not be able to implement(food security bill), we will not be comfortableto implement this,� Pawar said. Punjab on an

average, accounts for 23% of wheat and 10%of rice production in the country. Estimatessuggest that between 65 and 70 million tonnesof foodgrain would be required to implement theproposed food law. In 2010-11, wheatprocurement in Punjab was around 102 milliontonnes, and rice 93 million tonnes.

The state�s contribution in maintaining thecountry�s food security has had adverse impacton soil fertility and ground water situation of thestate. As many as 209 blocks in the state havebeen designated as �black blocks�, where thewater table has dropped to below 600 feet. Manyexperts stress that if Punjab doesn�t diversify itsagricultural production the chances ofdesertification will increase.

* Journalist, The Economic Times


6Food Security Bill will Benefit Multinational

Corporations and Hurt Genuine TradersTejinder Narang*

The Economic Times, February 02, 2012

The charter of the proposed National FoodSecurity Bill (NFSB) is reminiscent of the

socialistic era from the 1960s through the 1980swhere the state decided how much a personneeded and at what price that should be madeavailable, irrespective of the cost of production.That model of nationalisation of grain tradecollapsed with the demise of the Soviet Union.Though the intent of NFSB is laudable, itsfoundation is neither based on sound economicsnor does it take into account hazards ofimplementation.

For one, NFSB is an extension of thepolluted distribution system - a realisticinterpretation of the official public distributionsystem, or PDS - granting almost 65% populationthe right to access rice, wheat and maize at aminimum of 3-2-1 per kg, respectively, throughcentral and state agencies. What is the basis ofthe 3-2-1 formula? Why not distribute all grainsfree? Why is the state encouraging parasiticaltendencies for consumers on one side andpromoting manipulative cravings for trade on theother side?

The current BPL price of rice and wheat is 6per kg and 4 per kg, respectively. Net additionalsubsidy for these two cereals is, again, (6 - 3 =) 3and (4 - 2 =) 2 per kg, and, therefore, �netsubsidisation�, per se from the existing base ismarginal - but the critical concern is the ever-

expanding spread between the economic cost ofgrains and 3-2-1 formula.

The current economic cost of wheat and riceis about 24 per kg and 16 per kg, leading to a netloss, or difference, of 21 per kg and 14 per kg.This spread will increase as the minimum supportprice (MSP) is hiked annually. Multiplicityof ration cards at the local level will thrive andrise exponentially. Beneficiaries of �food security�will become retailers of these subsidised grainsrather than consumers in the open market as mostfarmers and labourers in rural areas retain partof their agro-produce for personal consumption.

Another channel of middlemen will becomeactive aggregators for these rural retailers whowill dispose subsidised grains either in the marketor recycle them to state procurement agencies. Abulk of the benefit will accrue to a string ofmiddlemen - a system that policymakers havebeen attempted to demolish (via FDI), but willbe reinforced through this food security Bill.

Even if the Centre intends to buy additional10 million tonnes of grain for NFSB, states suchas Uttar Pradesh, Bihar, Chhattisgarh and WestBengal will remain bereft of any procurement atMSP due to lack of a viable mechanism.Procurement of these crops is predominantlydone in Punjab, Haryana and Andhra Pradeshdespite paucity of scientific storages. If theintention is to mop up grains in these states by

* Owner, PEC LTD


engaging large corporates such as ITC, Adani,Pepsi, Hindustan Unilever and others, banks willfirst need to liberally finance them.

Secondly, the purchase protocol will involvepayment to farmers first followed byreimbursement from FCI or controller ofaccounts, and that would pose challenges.Corporates could be saddled with large arrearsdue to insufficient availability of funds in �headof accounts�, lack of compliance with procedures,complaints of payment below MSP, auditobjections and so on, thereby constrainingliquidity.

The availability of grains in the open marketwill shrink by extra procurement on governmentaccount as envisaged to the extent of 10 milliontonnes. Logically, it should result in inflation, butno, it will be deflationary on account of muchlower quotes offered by the intermediaries sellingmassive quantities of pilfered grains. It will bedifficult for a genuine trader to survive whenpushed to the brink by the �subsidised forces�.They will be pressured to enhance bargain in the�component of diversion�. Will government thenset up a vigilance force to regulate that activity?The Lokpal Bill will be saddled with additionalresponsibility to track possible corruption underNFSB.

Historically, after almost every six years, Indiaimports wheat due to poor agro climaticconditions. So far, import has ranged between6-8 million tonnes and that can now cross 10million tonnes when buffer norms and security

reserves are revised upwards. Since Indiaannounces its import requirement well inadvance, it will be a golden business opportunityfor Cargil, Glencore, Louis Dreyfus, Toepfer,ADM, Concordia and others to sell wheat ofRussian/Australian/EU/Argentinian origin atelevated prices on Indian shores with little storagecapacity in the interior. The need to import corndue to its inclusion in NFSB cannot be ruled out.Multinational corporations all over the world willbe thrilled to strategise by exploiting the urgencyof Indian sovereign demand.

State intervention in cereals is likely to inducesevere imbalance in the production of oilseedsand pulses, resulting in substantially outsourcingof imports in the coming years. The current levelof India�s import of edible oil is around 10 milliontonnes and pulses three million tonnes. Importintensity will intensify at higher prices creatinginflationary pressures, and net beneficiaries willbe MNCs such as Bunge and Wilmar, in additionto the countries of origin like Malaysia,Indonesia, Brazil, Argentina, etc., for oil, andMyanmar, Australia and Canada for pulses. Indiawill then be an active consumption market forsuch basic necessities of food. Vegetableproduction too may be affected - pushing foodinflation further.

The NFSB is a political master-stroke, but itseconomic viability and detailing of delivery couldpose challenges. These have to be factored inbefore it is made a law.


7Panel Suggests 5 kg of Subsidised

Grain to 67% of PopulationThe Financial Express

January 18, 2013

A Parliamentary panel on the food securityBill has suggested providing legal

entitlement of 5 kg of heavily-subsidised grainto each beneficiary per month, which wouldcover 67 percent of the country�s population.

The Standing Committee on Food, ConsumerAffairs and Public Distribution, headed by VilasMuttemwar, also said the direct cash transfer inlieu of grain entitlements at this juncture maynot be desirable, suggesting that bankinginfrastructure and accessibility to banking facilityneed to be made available throughout Indiabefore introducing the cash transfer.

�The beneficiaries should get rice, wheat andcoarse grain at R3, R2 and R1 per kg,respectively.... We have suggested that thereshould be a single category of beneficiary withuniform entitlement of 5 kg per person permonth,� Muttemwar said after submitting thepanel�s report to Lok Sabha Speaker MeiraKumar. The coverage under the proposed lawshould be reviewed after 10 years and rates afterfive years, he added.

However, the panel�s recommendations arecontrary to the government�s Food Bill thatdivides beneficiaries into two categories � priorityhouseholds and general households � and alsopromises a beneficiary belonging to the priorityhousehold 7 kg of subsidised grain a month.

�The committee found that entitlement of 7kg or 11 kg would not be feasible consideringthe current production and procurement trends,�Muttemwar said.

At 5 kg per person per month, 48.8 milliontonne of grain would be required for the publicdistribution system and another 8 million tonnefor other social welfare schemes, he said, addingthat this much quantity could be managed. Theannual food subsidy requirement would also belower at about Rs. 1,12,000 crore, he said.

�The report was adopted unanimously withone dissent note from CPM member TN Seema,�Muttemwar said. The panel agreed to the Bill�sprovision to cover 75 percent of the rural and 50percent of the urban population, he said.

Under the food Bill, a pet project of UPAchairperson Sonia Gandhi, the government hasproposed that each beneficiary of the priorityhouseholds get 7 kg of rice and wheat per monthat R3 and R2 per kg, respectively. The generalhouseholds would get at least 3 kg at 50 percentof the minimum support (MSP) prices of thegrain. The Bill was introduced in the Lok Sabhain December 2011 and, then, referred to theParliamentary committee.

The food ministry will now weigh changesproposed in the House panel�s recommendationsand firm up a final proposal for the cabinetapproval. Earlier, food minister KV Thomas hadsaid the Bill could be introduced in theforthcoming Budget season of Parliament.

Although the Bill is touted to be the UPA�sbiggest populist measure, several analysts haveexpressed concerns about its impact ongovernment finances. A team of experts, headedby CACP chairman Ashok Gulati, says in a report


that the government�s stated expenditure of Rs.1,20,000 crore annually in the national foodsecurity Bill (NFSB) is merely the tip of theiceberg. The report says the government wouldhave to shell out as much as Rs. 6,82,163 croreover three years to implement the Bill and wouldhurt the farm sector in the long run as well.

The government has budgeted Rs. 75,000crore as food subsidy during 2012-13, butofficials say the actual subsidy may cross Rs.100,000 crore because of a hike in paddy andwheat procurement prices.


8Pass Food Bill even Without Amendments

Amartya Sen*

The Hindu, May 07, 2013

Nobel laureate Amartya Sen is upset thatdisruption of Parliament has held up

passage of important legislation including theUPA�s flagship National Food Security Bill.

He feels that if the Bill is not passed � even ifwithout amendments � several hundred childrenwill go hungry or die from under-nutrition. TheBill has been criticised as �limited� and�targeted� by activists such as Jean Dreze andKavita Srivastava, who shared the dais with Prof.Sen to advocate its passage albeit with changes.

In the past, Prof. Sen too favoured theuniversal Public Distribution System but he said,�It is a moderate Bill and whether it goes farenough is another question but the case forpassing it is strong.�

Even as Prof. Sen addressed a press conferencehere on the pitfalls of not getting the food securitylaw through, there was a weak attempt in theLok Sabha to debate the Bill through theopposition din demanding the resignation ofcertain ministers. The Treasury benches werenearly empty. It is learnt that in a new strategythe Opposition parties that want to moveamendments will seek to get the Bill referred to aSelect Committee.

Prof. Sen was hard on the Opposition for notallowing Parliament to function. �You can havea different view, but not having a debate goesagainst the tradition of democracy. Allowarguments, rather than kill arguments, and not

allowing Parliament to meet is killingarguments.� The media should �take anintelligent interest� in what was happening. �Themedia should, for instance, put out the cost ofthe Bill not being discussed and passed.�

He was, however, quick to add that this didnot mean the government had no questions toanswer on corruption or the killing of SarabjitSingh but the Opposition demand could not takeprecedence over important legislation such as theFood Bill. �Killing debate raises the suspicion thatthe Opposition arguments are weak.�

What if the government were to take theordinance route to legislate the food Bill? Prof.Sen said, �It will be sad if it goes through theordinance route because Parliament did not doits job.�

The Bill provides for mandatory provision ofsubsidised rice (at Rs. 3 a kg) or wheat (Rs. 2) orcoarse cereals (Re. 1) to 67 percent of thepopulation at 5 kg per beneficiary a month. Thebeneficiaries will be identified by the Stategovernment as per the parameters set by theCentre.

It is being criticised for being targeted, for notspecifying a time frame for rolling out themeasure, for cutbacks in individual entitlementsand for allowing entry of contractors andcommercial interests in supply of food throughthe Integrated Child Development Services.

* Nobel Laureate, Thomas W. Lamont University Professor and Professor of Economics and Philosophy, HarvardUniversity

Nobel laureate Amartya Sen is upset that disruption of Parliamenthas held up passage of important legislation including the UPA�s

flagship National Food Security Bill.


9Food Security: For Poor�s Sake,

Jholawalas must Speak UpAkshaya Mishra*

Firstpost, June 14, 2013

Everybody hates jholawalas these days. Thisbunch - apparently Jurassic creatures with a

fossilised worldview still hanging around inmodern times for no apparent reason - is obsessedwith all that is ugly and dirty in India. Thejholawalas cannot stop talking about unsexytopics such as the poor, poverty, hunger,deprivation and malnutrition and they have thebad habit of being killjoys by delivering that pinprick of conscience when everyone is in a moodto celebrate the land of hope and happiness thatis India. Their latest assault on the country�sdelicate sensibilities, as their staunchest criticswould croak, is the Food Security Bill. Butsurprisingly, when it is under vicious attack fromseveral quarters, the normally argumentative lothas gone silent and invisible.

This is being construed by rivals as defeat andthe defeated, as is the rule, is despised even more.Actually, we don�t hate the jholawala - despitehis idiosyncratic ways isn�t he still one of us? Wehate the idea and the ideology he represents. It�shis emphasis on the poor that infuriates us. Whywon�t they accept that the poor that is at the rootof all problems in the country?

They are a big burden because they cannotmanage their lives on their own. They need to befed, educated, provided medical care, water andwhat not. The country has to ensure that theydon�t die. And all that requires money. Thecountry�s economy is in a mess because it

subsidises the poor too much. Fiscal deficit is indangerous territory because they eat up too muchmoney.

The country�s progress has halted on the trackbecause of them. The global minders of oureconomy keep reminding us that unless we cutsubsidies for the poor we are headed towardsdoom. Rating agencies keep frowning on India�ssocial sector spending. Global investorssupposedly get the jitters about India when itturns �populist�.

As if all the trouble from the poor were noenough we have this monster of an idea calledrights based food security, conceived by thejholawalas. This lot is incorrigible indeed!Reuters But why don�t they put up a fight? Thecritics of the bill don�t have valid arguments -forget the fiction of numbers we get - against it.And their position reeks of hatred for the poor.

Let�s look at a few of them. Four lakh crore iswhat it would cost the government and itcertainly would ruin the economy, whine experts.Four lakh crore? Where did that number comefrom? But on that latter. First things first. Arethe poor only people enjoying the subsidy in thecountry?

Let�s check out the numbers. In 2010-11, thegovernment surrendered potential revenue of Rs4.6 lakh crore on account of various taxexemptions and incentives to the industry sector,read the rich. The amount surrendered the

* Senior Editor, Firstpost.com


previous year was Rs 4.37 lakh crore and it wasRs 4.20 lakh crore in 2008-09. More than 76percent of the estimated revenue from direct andindirect taxes was forgone in 2008-09. It meansonly a quarter of the assessed income came tothe state�s coffers.

The situation has not changed over the years.A CAG report says the revenue foregone onaccount of tax exemption has increased by 111.8percent from Rs 65,587 crore in 2006-07 to Rs1,38,921 crore in 2010-2011. Meanwhile, thespend on the subsidy to the poor and farmershovers around Rs 1.50 lakh crore. The subsidyto the rich accounts for more than 7 percent ofthe GDP while that for the poor, with the FoodSecurity Act, would account for 1.1 percent ofthe GDP. The rich get special tax rates,exemptions, deductions, rebates, deferrals andcredits.

We don�t call it subsidy; we call it incentives.Even the words used for the poor and the richare different. Aren�t the taxes foregone and theexemptions a burden on the economy? Don�t theycontribute to fiscal deficit?

The argument for the Incentives is they allowthe rich to produce more wealth and lift theeconomy - there�s no proof that these haveworked that way in the country though. But isn�ta well fed workforce population an asset for thecountry too? Now, the four lakh crore. Bignumbers have the capacity to awe, impress andinfluence judgements.

Former CAG Vinod Rai has already proved itwith his �presumptive� loss calculation in the 2Gspectrum and coal block allocations. Maybe asimilar tactic is at play to discredit the foodsecurity legislation. The country spends aroundRs 70,000 crore on food subsidies at present.This, according to the supporters of the bill,might go up by a maximum Rs 30,000 crorewhen the food security bill becomes an act.

The cost implication from the food securitylegislation is only Rs 20,000 crore, says MontekSingh Ahluwalia, Deputy Chairman of PlanningCommission. Union Food Minister KV Thomasplaces the entire cost of food subsidy Rs 1,23,084

crore after the relevant bill becomes an Act. It�spossible they are underestimating the cost, butthe advocates of this bill argue that thearchitecture for the major money-guzzlingcomponents of this legislation such as the PDSsystem, mid-day meals, ICDS already exists. Thusthe cost implications are highly exaggerated. Sowhere does this Rs 4 lakh come from? Is it somekind of �presumptive� loss estimate we are into?

The Food Security Bill has serious unresolvedproblems on procurement, transportation anddistribution fronts. There is the valid questionwhether the government will be the biggesthoarder of foodgrains in the country after itcomes into effect and whether it will severelydistort the foodgrain market in the country.These call for intense debate. But pegging theentire argument on the impact on fiscal deficit ismorally unjustified. If food subsidy to poor isbad economics then incentives to the rich is badeconomics too. Most of the criticism of the foodsecurity provision has an undeniable politicalundertone.

The fear is, once the beleaguered UPA IImanages to get it through, it will seize the moralhigh ground and approach the elections on a solidfooting. It could be a game changer for the party.However, the same critics have been arguing thatit�s not the MNREGA but steady growth thatensured victory for the UPA I in 2009. Highgrowth, they argue, implies intense economicactivity, more jobs, more employed people andconsequently, more goodwill for the governmentin power.

We are at a low growth phase right now andthe government has to bear the consequences ofit. If that is the case, what is the specific worry?Or is it that the experts are not so sure of thegrowth-electoral success connection?

The jholawalas, have gone unusually silent.Maybe it has to do with the politicalmarginalisation of the Left. But their silence hasallowed noise to overpower intellect and kill thewonderful concepts of perspective and debate.The poor need their spokesperson too, howeverflawed they are. The jholawalas must speak up.


10Exclusion as Policy

T K Rajalakshmi*

Frontline, July 12, 2013

The National Food Security Bill (NFSB), 2013,touted as the biggest game changer for the

Congress-led United Progressive Alliance (UPA)government in the 2014 parliamentary elections,will go through yet another round of discussionsbefore it is placed before Parliament in themonsoon session or in a specially convenedsession.

The Bill was cleared by the Union Cabinet onMarch 19 and was tabled in Parliament on March22 in the Budget session itself. It purports to cover67 percent of the population, providing priorityhouseholds 5 kilograms of foodgrain a personevery month, or 25 kg for an average family offive.

Repeated attempts by the Congress to pushthe Bill through in the form of an ordinance didnot succeed, with its allies, the NationalistCongress Party, the Rashtriya Lok Dal, theNational Conference and the Indian UnionMuslim League, opposing it. Expressing strongreservations over the Bill, the Samajwadi Party,which is supporting the UPA from outside,described it as anti-farmer. It is learnt that therewere divisions within the Union Cabinet on usingthe ordinance mode.

On June 13, a three-member committeecomprising Home Minister Sushil Kumar Shinde,

Parliamentary Affairs Minister Kamal Nath andFood and Civil Supplies Minister K.V. Thomaswas constituted to hold consultations with theopposition to evolve a consensus on convening aspecial session of Parliament for the Bill�s passage.

The Centre moved about 55 amendments,which it claimed were based on therecommendations of the Standing Committee andviews expressed by several stakeholders. Theautomatic exclusion criteria would keep a fairlysignificant section of people out of the PublicDistribution System, or PDS: 25 percent of ruraland 50 percent of the urban population.

The priority and general classifications havebeen done away with, which gives the falseimpression that the scheme is universal. Theamended Bill seeks to provide a uniformallocation of 5 kg of foodgrain to a person at afixed rate of Rs.3 for 3 kg of rice, Rs.2 for 2 kgof wheat and Re1 for 1 kg of coarse grainscovering 67 percent of the population (75 percentof rural and 50 percent of urban population).There is no change in the supply of 35 kg offoodgrain a month to every Antyodayahousehold.

Externally, the government blamed anintransigent opposition for stalling what it calledan important piece of legislation and even tried

* Special Correspondent, Frontline

Attempts by the Congress-led UPA government to adopt theordinance route to pass the Food Security Bill fail as the opposition

parties are more or less united in seeking a Bill that providesuniversal PDS coverage.


to get the Bill passed in its present form byenlisting the support of high-profile individualssuch as Nobel laureate Amartya Sen and some�civil society� organisations. These attemptsfailed.

As it is a one-of-its-kind Bill, seeking to makethe right to subsidised foodgrain legal, it has tobe comprehensive. However, the Bill in its presentform with its exclusionary criteria is far fromcomprehensive.

Minimalist provision Ironically, although the Bill�s objective is to

�provide for food and nutritional security inhuman life cycle approach, by ensuring access toadequate quantity of quality food at affordableprices to people who live a life with dignity andfor matters connected therewith�, its minimalisticprovision of 5 kg to each individual does notguarantee food security, leave alone nutritionalsecurity, which would entail a basket of fooditems that go beyond cereals.

The entitlement of 5 kg is far below the foodrequirements prescribed by the Indian Councilfor Medical Research (ICMR) � 14 kg for anadult and 7 kg for a child. It also runs contraryto a Supreme Court ruling that below povertyline (BPL) households should not be given lessthan 35 kg a month. This entitlement covers only10 percent of the population, that is, familiesunder the Antyodaya scheme.

Several States have food security programmesthat are much better than what is being offeredin the Bill. Moreover, the Left parties, which wereinstrumental in the UPA government launchingmajor welfare measures such as the MahatmaGandhi National Rural Employment GuaranteeScheme (MGNREGS) and the Forest Rights Act,have opposed the Bill. They are planning to moveamendments. The Bharatiya Janata Party (BJP),which was not opposed to the Bill initially, hasnow announced that it will move amendments.BJP president Rajnath Singh has termed theordinance route �undemocratic�.

The Biju Janata Dal, the Trinamool Congressand the All India Anna Dravida MunnetraKazhagam also plan to move amendments.Chhattisgarh�s BJP Chief Minister Raman Singhwrote to Prime Minister Manmohan Singh

suggesting, among other things, that theentitlement of foodgrain be made on a perhousehold basis instead of per capita basis andthat the limit of entitlement to eligible familiesbe raised.

He reminded the Prime Minister of therecommendation of the Parliamentary StandingCommittee on Food, Consumer Affairs andPublic Distribution that the Centre work outState-specific exclusion criteria in consultationwith State governments in a transparent mannerwhile ensuring that the overall exclusion at thenational level does not exceed 25 percent in thecase of rural areas and 50 percent in the case ofurban areas. The Bill seems to have incorporatedthis recommendation in part but has done anoverreach as far as principles of federalism areconcerned.

State governments� reservations The State governments that already have a

better system and coverage in place haveexpressed their reservations about the Bill, whichstipulates that the percentage coverage under theTargeted Public Distribution System in rural andurban areas shall be determined by the Centralgovernment and the total number of personscovered will be according to the Census estimates.

Raman Singh pointed out that the exclusioncriteria should be fixed on the basis of the socio-economic conditions of every State. In his letterto the Prime Minister, he said: �Instead, theexclusion limit for a State, if at all, should befixed keeping in view the socio-economicconditions of the State.� The provision ofentitlements on a per capita basis would resultin reduction of the entitlements of a large numberof poor families with fewer than five members.�This would be detrimental to ensuring the foodsecurity of such poor families.

Therefore, the entitlements should be providedon a per household basis and not on a per capitabasis,� the letter said. He also argued that themeagre allotment of 5 kg a person would not besufficient to ensure food security in a meaningfulway. He suggested a monthly provision of 35 kgfor every poor household, which is the positionthe Left parties have taken, although they are


pushing for a universal PDS without the exclusioncriteria.

Brinda Karat, Polit Bureau member of theCommunist Party of India (Marxist), said: �Itwas surprising that the government was planningto take the ordinance route. We opposed it. Forfour years the government did not move. For thepast two years, six crore tonnes of foodgrain havebeen rotting in the godowns and the governmentwas unconcerned, and now they do not even wantto wait for a month. The problem with the Bill isthat it excludes 50 percent of India�s urbanpopulation with a new automatic exclusioncategory.

At a time when the number of urban poor isgrowing and a majority of the labour force is inthe unorganised sector without a guaranteedincome, it is highly unfair to have an automaticexclusion category. Similarly, in the rural areas,there is an automatic exclusion category of 25percent. In other words the discredited systemof targeting forms the basis of the Bill which willnow become legal. We have movedamendments.�

The cost-sharing mechanisms between theCentre and the State, too, were problematic, shesaid, based as they were on a principle of �Idecide, you pay�. The CPI(M) plans to move anamendment demanding that all cost-sharing be

done in consultation with the State governments.The per capita entitlement would be grosslyunfair to families that get 35 kg under the PDS�in Kerala, for instance. The Left parties areopposed to the introduction of the scheme ofdirect cash transfer in the PDS, which they say isa ploy to do away with the system itself and forcepeople to purchase foodgrain from the openmarket. This will in effect affect the farmers asprocurement for the PDS will come down.

Left for universal PDS The Left parties want nothing less than a

universal PDS where every family gets 35 kg offoodgrain on the basis of the calorific criteria ofthe ICMR. One positive feature of the Bill is thatit has done away with the two-child norm, whichwas earlier the criterion for excluding familieswith more than two children and as such,pregnant and lactating women, who were entitledto a free meal at the local Anganwadi centre anda maternity benefit of not less than Rs.6,000prescribed by the Central government.

The Bill in its new avatar lacks a time framefor implementation. It has dropped the idea ofproviding community kitchens for the destituteand those on the brink of starvation.


11Food Security:

Only Two Congress States ReadyIftikhar Gilani*

Daily News and Analysis, July 14, 2013

Even as the Congress president Sonia Gandhiextorted Congress-ruled states to

expeditiously implement the food securityscheme, only two chief ministers committed tocoincide the rolling out of the scheme with thebirth anniversary of late prime minister RajivGandhi on August 20.

Majority of chief ministers said identificationof beneficiaries, setting of criteria and a leakageproof mechanism was proving a challenge. Buteven those chief ministers, who committed to rollout the scheme by next month, could not provideconvincing figures, to support their assurance.

Insiders said Delhi chief minister Sheila Dikshitand Haryana chief minister Dhupinder SinghHooda who boasted to roll out scheme on August20 had to cut short their presentations, when foodminister KV Thomas challenged their figures.Other chief ministers while appreciating thescheme did not commit to any timeline.

Dikshit�s presentation was cut short by foodminister, when she mentioned that 32 lakhbeneficiaries of existing schemes would becovered by the food security ordinance. She wasreminded that in Delhi 72 lakh people areestimated to gain from the food security scheme.She had mentioned that Delhi had 2.62 lakh BPLcard holders and 2.21 lakh are in therehabilitation colonies and other 40,500 are inslums. Even these figures made just 26 lakhpersons. Delhi CM then added another 10 lakh

beneficiaries covered under the Antyodaya AnnYojana and Anna Shri Yojana. She was told toundertake a fresh survey and draw the list ofbeneficiaries.

Similarly, Hooda also come out with a figureof just 39 lakh beneficiaries. He was also toldthat as per the population of his state, he needsto draw a list of not less than 1.69 crore.

The meeting was called by CongressPresident Sonia Gandhi to prepare a strategy forthe implementation of food security ordinance,which is touted as a game changer ahead of theelections.

Others who attended included Prime MinisterManmohan Singh, Congress vice-president,Rahul Gandhi chief ministers of 14 Congressruled States and other 34 top Congress leaders.

The meeting was told the ordinance empower82 crores Indians with a legal right to food andwill serve as a bulwark to fight againstmalnutrition and deprivation.

The leaders also expressed apprehensionabout poor condition of Public DistributionSystem and their transportation. Manipur chiefminister Okram Ibobi Singh pointed out theproblem of carriage of the foodgrains in the hillyareas, while Mizoram CM Pu Lalthanhawlaraised the issue of financial constraint before thestate but not specifically related to food security,the sources said.

* Head, Bureau of the Kashmir Times in Delhi

Most CMs list reasons to skip Aug deadline


12PDS: A Story of Changing States

Himanshu Bhagat*

Mint, August 05, 2013

The National Food Security Bill (NFSB) hasbeen finally tabled in the Lok Sabha. While

the United Progressive Alliance (UPA) sees it asa game changer for its electoral fortunes, there isvalid scepticism on the ability of the governmentto deliver on its promises. There are loose endsto be tied up such as restructuring of the publicdistribution system (PDS), identification of thosefor whom the law is meant; and puttingappropriate regulatory and other measures forthe smooth functioning of the system.

These are valid concerns and are importantnot because key provisions of NFSB relate to PDSbut also because PDS is known to be leakageprone and inefficient. However, some of theseconcerns have lost ground since 2004-05 whenmost states started reforming PDS byimplementing technical fixes along withexpanding coverage and reduction in the pricesof foodgrains under PDS.

Most of the criticism of PDS has emanatedfrom a comparison of the data from theconsumption expenditure surveys with theofficial off-take figures from the ministry of foodand consumer affairs (MFCA). The latest roundof consumption expenditure for the year 2011-12 was released recently. Data from the surveyshows the extent of leakage for rice and wheat,taken together, is 35 percent only compared with55 percent in 2004-05 using the same method.

Thus, within a span of seven years the reformsintroduced by states have led to a significantreduction in leakages. What is also worth notingis not only the curbing of leakages but also theexpansion in access to PDS. Only 23 percenthouseholds purchased cereals in 2004-05 and 39percent in 2009-10. This number rose to 44.5percent in 2011-12. In 2011-12, 50 percent ofrural and 31 percent of urban population waspurchasing cereal from PDS.

More than the all-India story, it is the states�performance that inspires hope. The traditionallylow or negligible leakage states of Tamil Nadu,Andhra Pradesh and Himachal Pradesh continueto maintain an efficient PDS. However,Chhattisgarh and Orissa have now joined thesestates in showing a remarkable reduction inplugging leakages. For Chhattisgarh, the extentof leakage is negligible and Orissa managed toreduce it from 25 percent in 2009-10 to just 15%in 2011-12.

Most states have witnessed an increase in thepercentage of population accessing cereals fromPDS along with a reduction in leakage. This ismost visible in states which reduced the prices ofPDS foodgrains and/or expanded coverage. Thesestates include Bihar, Kerala, Uttarakhand,Jharkhand, Madhya Pradesh, Assam and WestBengal.

* Delhi-based Freelance Writer

Plugging leakages in the public distribution systemrequires nothing more than simple technical fixes


Among the states that have dramaticallyimproved their performance in this respect, onestate that stands out is Bihar. A former laggardin this respect, Bihar was the state with the highestleakage and lowest percentage of populationaccessing PDS has shown a surprisingturnaround. Per person consumption of PDScereals in Bihar was 0.66kg in 2009-10 as againstthe national average of 1.8kg per person. By2011-12, per capita consumption of rice andwheat from PDS increased to 2.2kg per person,marginally higher than 2.1kg per personnationally. What about leakages? As against 65percent leakage in PDS in 2009-10, Bihar hasmanaged to reduce leakage in 2011-12 to only12 percent.

While most states including traditionallaggards such as West Bengal and Jharkhand haveshown improvement in the functioning of PDS,there is one state which needs to be mentionedfor deterioration in performance of PDS. Thestate which turns out to be the worst performeras far as functioning of PDS is concerned isGujarat. Not only has the percentage ofpopulation purchasing from PDS declined from26 percent in 2009-10 to 22 percent in 2011-12,the average consumption from PDS per personhas also declined from 0.8kg per person to 0.6kgper person.

But the worst aspect of PDS performance inGujarat is the fact that it is now the state with

the highest leakage in PDS in 2011-12: The figurerising from 45 percent in 2009-10 to 69 percentin 2011-12. Among big states, Gujarat had thehighest leakage in 2011-12.

So how did Bihar achieve a turnaround andwhy is Gujarat doing poorly? Bihar used simpletechnological fixes such as computerisation,doorstep delivery of foodgrains and globalpositioning system to track foodgrain movementand improve transparency in the system. It alsoincreased the coverage of households eligible forPDS cereals from 6.5 million to 12.3 million usingits own resources. Last year, Bihar budgeted forRs1,283 crore for food and civil supplies. Asagainst this, Gujarat budgeted just one-third ofthat sum at Rs476 crore.

While both states have shown remarkableperformance on measures such as growth rate,the real yardstick of governance is the ability ofstate governments to deliver basic services to thepoor. A far more important lesson from theexperience of poorer states such as Orissa,Chhattisgarh and Bihar is the successfultransformation of a leaky PDS into an efficientvehicle for poverty reduction. In all the threecases, it was led by leaders who had politicalconviction and if these are any indication for howNFSB may be improved, there are certainlylessons to be learnt.


13The National Food Security

Ordinance: Five Misconceptions Reetika Khera*

Ideas For India, August 07, 2013

Misconception 1 - The National Food SecurityOrdinance (NFSO) will do nothing about under-nutrition: Many feel that the NFSO cannot domuch to reduce under-nutrition, as it onlyprovides cheap cereals. This is because of theoverwhelming focus on the Public DistributionSystem (PDS) in public debate. In fact, the NFSOtakes a life-cycle approach, half-hearted as it maybe, to food security. Even these limitedinterventions are important for the followingreasons.

First, the National Food Security Bill (NFSB)includes maternity entitlements (Rs. 1000 orapprox. US$16.67 per month for six months forpregnant women) which could go a long way inensuring better nutrition in the womb.

Two, it includes supplementary nutrition forchildren under six through the Integrated ChildDevelopment Services (ICDS) scheme, includingchildren in the 0-3 year age group, a crucialperiod for battling under-nutrition. Finally, eventhe PDS can contribute to better nutrition. Thereis a provision to supply more nutritious grain (forexample, millets and maize) instead of wheat andrice. Some states (Andhra Pradesh, Chhattisgarh,

Himachal Pradesh, and Tamil Nadu) alreadyprovide nutritious commodities such as pulsesand oil, and the NFSO may prompt others tofollow.

Further, households may use the �implicittransfer� from buying cereals at cheap prices todiversify diets and buy more nutritious fooditems. What remains true is that the NFSO is onlya step ahead, where a leap was required.

Misconception 2 - The NFSO imposes a hugefiscal burden: The NFSO is expected to lead toan increase of about Rs 30,000 crores (US$4.9bn)in the food subsidy, from the current Rs 90,000crores (US$14.7bn) to Rs 1.2 lakh crores(US$19.6bn), which is around 1.2 percent ofGDP. Estimates such as �3 percent of GDP� and�Rs. 6 lakh crores over three years� 1 areexaggerations (somewhat unusually, the latterestimate is presented aggregated over three years,whereas the convention is to present them �peryear�.) Note also that the food subsidy is acombination of support to farmers and theconsumer subsidy.

* Assistant Professor, Humanities & Social Sciences, IIT, Delhi and a fellow at the Institute of Economic Growth,

Delhi

The National Food Security Ordinance was promulgated in July2013. The public debate that ensued, especially the criticism in thebusiness media, has tended to be either devoid of facts or factuallyincorrect. This article attempts to correct the terms of the debate

with relevant facts.


The next question is whether we can afford afood subsidy of Rs. 1.2 lakh crores (US$19.6bn)for the NFSO. To put the cost in context: in 2012-2013, tax revenues foregone amount to morethan Rs. 5 lakh crores (US$82bn) and the increasein the food subsidy (Rs. 30,000 crores orUS$4.9bn) is less than the subsidy given to thegold and diamond industry (Rs. 60,000 croresor US$9.8bn).2 Currently, the fuel subsidy ishigher (Rs. 96,880 crores or US$15.9bn) thanthe food subsidy (Rs. 90,000 crores orUS$14.7bn) and fertiliser subsidy is of similarmagnitude (Rs. 65,974 crores or US$10.8bn). Itis also reasonably well accepted that the fuel andfertiliser subsidy do not go to the poorest. Viewedin this manner, the affordability of the food billis ultimately a question of political commitmentand priorities. Clearly, fiscal space does exist.

Misconception 3 - The NFSO is �anti-farmer�and will adversely impact agriculture: Today, thegovernment commits 58 million tonnes of grainto the PDS, ICDS and Mid-Day Meal (MDM).This will increase by 5 million tonnes, to 63million tonnes with the NFSO. The governmentprocures about 30 percent of totalproduction and only needs to continue to do so.The remaining 70 percent of grain trade in wheatand paddy in the private market will remainunaffected even after the NFSO is implemented.The overall requirement of grain and the shareof public procurement in total production willchange only marginally as a consequence of theNFSO. Consequently, the claim that India willbecome dependent on imports and that the NFSOwill lead to higher prices for non-beneficiaryhouseholds is baseless.

One political party has labelled the NFSB as�anti-farmer�5. When a senior spokesperson wasasked to explain how in a televised debate, theonly response he could manage was �we will doit in Parliament�! In fact, governmentprocurement through the Food Corporation ofIndia (FCI) is welcomed by farmers as it enhancestheir choices -to sell in the private market or toFCI. Without FCI, farmers would have no optionbut to sell to private traders. Some argue thatthe NFSO will further strain Punjab andHaryana�s agricultural sector.

Again, the facts tell a different story:procurement has become more decentralisedsince 2004-2005 and the combined share of non-traditional states (Andhra Pradesh, Chhatisgarhand Odisha) in paddy procurement has risen to33-45%.Others feel that if grain is provided atRs. 1-3/kg (0.2-0.3 US$ approx./kg), thosefarmers who produce for self-consumption willstop doing so. Chhattisgarh�s experience withdecentralised procurement and an expanded PDSdoes not corroborate this.

Finally, the Bill contains a provision forincluding millets and maize, so that there is scopefor diversification of cropping patterns. That theagricultural sector needs urgent attention andreform is not in dispute, but the NFSO does nothinder that process.

Misconception 4 - The PDS is uniformly �leaky�so the grain will not reach the poor: The NFSOwill deliver grain and other commodities throughthe PDS. While it is true that the PDS has beenplagued by corruption (between 2004-2005 and2009-2010, overall leakage declined by 15percentage points to 40 percent), some states haveshown remarkable improvement � for example,in Chhattisgarh leakages are down to 10 percent(from 50 percent) and in Odisha 30 percent (from75 percent) over the same period.

Even in states with high overall leakages (forexample, in Uttar Pradesh leakages were justunder 60 percent), the Below Poverty Line (BPL)and Antyodaya Anna Yojana (AAY) householdsseem to get their share. In a survey of BPL andAAY households in 2011, respondents in UttarPradesh reported getting 77-88 percent of theirentitlements (see Khera 2011).

Apparently, it is the Above Poverty Line (APL)quota that is leaky. Let us understand why.Between 2000-2008, when APL prices of wheatand rice (Rs. 8-10 per kg or US$0.13-0.16 perkg) were close to the market price, neither APLcard holders nor state governments wereinterested. Over time, the APL card became nota �ration� card, but a �mitti ka tel� (kerosene) card.Around 2008-2009, market prices of grain nearlydoubled (approximately Rs. 15-20/kg or 0.25-0.33 US$/kg) ,and even APL grain becamesubsidised. Increased offtake under the APL and


�special ad hoc� quota in the past four years(ranging between 35-45 percent of total offtake)reflects renewed state interest in this quota. Manystates use it to expand coverage, but in others(like Uttar Pradesh and Madhya Pradesh), APLcard holders are unaware of their entitlementsare and many PDS dealers do not know that APLgrain is being lifted. The lack of clarity andtransparency has opened the door to corruption.

In such states, as the NFSO rolls out, manyAPL card holders will become �entitled�households with clear entitlements (25kg permonth at Rs. 1-2-3/kg). Grain flowing throughthe leaky APL �pipe� will be channelled througha transparent BPL-AAY �pipe�, with significantlylower cheating. The NFSO is an opportunity toend the large scale diversion of APL grain.

Misconception 5 � The NFSO requires a bigexpansion of foodgrain procurement anddistribution: As explained above, the foodgrain

requirement of the NFSO is around 63 milliontonnes, just 5 million tonnes more than thecurrent commitment to the same programmes.Many believe that the NFSO entails a bigexpansion of procurement. This is not true. Thereason why more people can be covered with thesame foodgrain requirement is that a very largeshare of the grain currently is allocated throughthe APL, �ad hoc� and �special ad hoc� quotas.And the allocations (and offtake) under thesequotas have been rising because the governmenthas too much grain! Because these quotas arenot regular allocations, as explained above, insome states, they get misused.

Those who label the NFSO as �populist� seemto confuse the term with �popular�: as pointedout earlier, the NFSO makes a moderate claimon the budget. And if popular schemes winelections, it can only be regarded as an indicationof �something gone right� with India�s democraticsystem.


14Food Security Bill to Provide Food and Nutritional

Security in Human Life Cycle ApproachK V Thomas*

Odisha Diary, August 13, 2013

Report by Odisha Diary bureau, New Delhi:Proposed National Food Security Bill is

unique initiative to provide for food andnutritional security in human life cycle approach,by ensuring access to adequate quantity of qualityfood at affordable prices. Nowhere in the world,such a social justice programme has beenattempted at such a gigantic scale. This was statedby Prof. K.V.Thomas, Minister for ConsumerAffairs, Food and Public Distribution whiledelivering the inaugural address at the �South AsiaPolicy Dialogue on Regional Cooperation forStrengthening National Food Security Strategies�organised by the ESCAP, here today. Prof.Thomas said that the proposed Bill providesstatutory basis for a framework which assuresfood security for every family below the povertyline in rural as well as urban areas of the country.

Listing out the important features of the FoodBill, Prof .Thomas said after the enactment two-third of the population will become legallyentitled to receive highly subsidised food grains.Each entitled person will receive 5 kg of foodgrains per month i.e. rice, wheat or coarse grainsat Rs.3, Rs.2 and Re. 1 per kg. respectively. Thepoorest of the poor who have been getting 35 kgof food grains, will continue to get 35 kg foodgrains per household per month under AAY. Hesaid that with the aim of giving special focus towomen and children.

The Act will ensure that the eldest woman ofthe household above 18 years is considered thehead of the household for the purpose of issue ofration cards. Not only that pregnant women andlactating mother will get maternity benefit of Rs.6000/- and pregnant women and children below14 years of age will get nutritious meals, withhigher nutritional norms for malnourishedchildren.

On the issue of redressing grievances that mayarise in implementation of such a massive socialjustice programme, it has been planned to givean increased role for Panchayati Raj Institutionsand women�s self-help group in programme-monitoring and social auditing. There will beprovision for internal grievance redressalmechanism including call centres and help lines;and District Grievance Redressal Officers andState Food Commission for expeditious andeffective.

Full text of Shri Thomas speech is as follows:-�It gives me immense pleasure to be amongst

this distinguished gathering at this �policydialogue� on a very important topic havingrelevance not just to the South Asian countriesbut to the whole world as each of us strive toensure that the world becomes hunger-free inconsonance with the initiative taken recently by

* Minister of State for Agriculture, Consumer Affairs, Food & Public Distribution, Government of India


the UN Secretary General to face �Zero HungerChallenge.�

I congratulate the ESCAP South and South-West Asia Office in organising this South Asiapolicy dialogue on regional cooperation forstrengthening national food security strategies todevelop a common understanding ofopportunities and challenges that confront us inthe area of food security for our population. Ialso extend a warm welcome, on behalf of thepeople of India, to our guests from South Asiancountries who have assembled here to exchangetheir views and to give us the benefit of theiradvice and suggestions on food security in SouthAsia.

The South Asian countries such asAfghanistan, Bangladesh, Bhutan, India,Maldives, Nepal, Pakistan and Sri Lanka have acommon history and a distinct geographicalidentity. These countries are also united throughculture and tradition. The South Asian countriesaccount for about 34 percent of Asia�s population(or over 16.5 percent of the world�s populationwhich is more than 1.6 billion of people) and arehome to a vast array of peoples.

According to the Food and AgriculturalOrganisation (FAO), Asia would account forabout one-half of the world�s undernourishedpopulation, of which two-thirds would be fromSouth Asia, which remains a major cause forconcern. Majority of the South Asian populationlives in rural areas and most of them rely onagriculture for their livelihood. Being the mostpopulous and the most densely populatedgeographical region in the world, the South Asianregion naturally has a high stake in global effortsin confronting global hunger and malnutrition.

Declining investments in research andinfrastructure, falling water tables, globalwarming and climate change are consideredcrucial factors that affect food security across theglobe. Coming to South Asian region, theagriculture sector is confronted with variousproblems like low productivity, pricefluctuations, low returns to farmers, diversionof agricultural land to other purposes, etc. Theneed of the hour is increased investment, policyreforms, innovations in agro-ecology to keep upwith challenging times, et al.

These, I believe, may guide us to sustainableand yield-increasing techniques that mayrevolutionise our agriculture production. Needless to say, regional cooperation inexchange of ideas, experiences and strategies thatcan bring in buoyancy in agricultural productionwill go a long way in further strengthening bondsand friendship among countries of the SouthAsian region.

I would like to say a few words about�Kuttanad below sea-level farming system�practiced in my home State Kerala, known as�God�s Own Country,� which will be of someinterest to this august gathering. The farmingsystem was formally declared as a GloballyImportant Agricultural Heritage Systems(GIAHS) by the United Nation�s Food andAgriculture Organisation. The farmers ofKuttanad have developed and mastered thespectacular technique of below sea-levelcultivation over 150 year ago. They made thissystem unique as it contributes remarkably wellto the conservation of biodiversity and ecosystemservices, including several livelihood services forlocal communities.

I understand that the below sea-level farmingpracticed in Kuttanad is of great interests tocountries such as Malaysia, Bangladesh and theMaldives. I wanted to mention about thisbecause these are examples of unique andsuccessful experiments in the field of agricultureproduction, on which one country may takeguidance from another to take advantage of suchinnovative techniques.

A large part of the debate on Indianagriculture is concentrated around food securityconcerns of the people of the country. It isestimated that our country�s population willtouch 1.3 billion by 2018. Therefore, while onthe one hand, we have to take care of the presentfood needs of the people, we also have to plan toensure that the challenges that the populationincrease poses, in terms of food needs, over theyears is also kept in mind. We cannot grow land;but we can certainly find new techniques to growmore with the available land. India�s agriculturehistory can be traced back to at least 10 thousandyears.


Now our country occupies the coveted secondposition in agricultural production in the world.The food grain production which was at 51million tonnes in 1950-51 has touched 255.36million tonnes in 2012-13, an increase inproduction by more than five times around aperiod of six decades. In respect of fruit andvegetables, the production had reached 240.84million tonnes in 2012-13 from 134.27 milliontonnes in 2003-04, a big leap within a decade. The full credit for this achievement must go toour farmers, agricultural scientists as also leaderswho took up the challenge of leading the countryand its people to prosperity.

Now, we look at the eastern part of ourcountry which has enormous, untapped potentialfor agricultural growth. Therefore, inconfidence, we aim at �ever-green revolution,� �an attempt at increase in productivity, whichmust be perpetual and with least harm to ourfragile eco system � and, it is only a matter oftime before we achieve that, too.

Mahatma Gandhi ji said: �There are peoplein the world so hungry, that God cannot appearto them except in the form of bread (food).� TheElection Manifesto, 2009 of the Congress Partyheading the United Progressive Alliance whichis in power in India made a commitment to thepeople of India. The commitment was to enacta new law - the National Food Security Act -that will provide a statutory basis for aframework which assures food security for everyfamily below the poverty line in rural as well asurban areas of the country. I have great pleasurein informing this august gathering that thehistoric National Food Security (NFS) Bill hasbeen moved in Parliament which is in the processof debating the same (currently an NFSOrdinance is in force), by which 67 percent ofthe population are made entitled to receivesubsidised grains from the government everymonth. The most important thing about theOrdinance is that nowhere in the world, such asocial justice programme has been attempted atsuch a gigantic scale. The Ordinance, which issoon going to be converted into an Act ofParliament, aims �to provide for food andnutritional security in human life cycle approach,by ensuring access to adequate quantity of quality

food at affordable prices to people to live a lifewith dignity.�

For the benefit of this illustrious gathering Iwould like to list out the important features ofthe Ordinance. They are:

(1) Right to food: i.e. two-third of thepopulation become legally entitled to receivehighly subsidised food grains;

(2) each entitled person will receive 5 kg offood grains per month (i.e. rice, wheat or coarsegrains at Rs.3, Rs.2 and Re. 1 per kg. respectively;

(3) the poorest of the poor who have beengetting 35 kg of food grains, will continue to get35 kg food grains per household per month underAAY.

(4) with the aim of giving special focus towomen and children, the Ordinance will ensurethat the eldest woman of the household above18 years will be considered the head of thehousehold for the purpose of issue of ration cards;

(5) pregnant women and lactating mother willget maternity benefit of Rs. 6000/-, and

(6) pregnant women and children below 14years of age will get nutritious meals, with highernutritional norms for malnourished children.

On the issue of redressing grievances that mayarise in implementation of such a massive socialjustice programme, it has been planned to:

(1) give an increased role for Panchayati Rajinstitutions and women�s self-help group inprogramme-monitoring and social auditing;

(2) make provision for(a) internal grievance redressal mechanism

including call centres and help lines; and(b) District Grievance Redressal Officers and

State Food Commission for expeditious andeffective redressal of grievances.

So gigantic has been the attempt, the efforthas not gone unnoticed by the world. Prof.Amartya Sen, the Nobel Laureate, had comestrongly in favour of the �food security� for thepoor of the country, for Prof. Sen felt that that ifthe Bill was not passed, several hundred childrenwould go hungry or die from under-nutrition.

Ladies and Gentlemen: the world has becomea global village. No more can we do somethingin one country and not expect its vibrations andrepercussions in some other parts of the globe.


The people of the South Asian countries sharenot just their past, but their future, too. Thoughpoverty drags us down, we are not going to let itprevent our onward march to a brighter futurefor our peoples. Each country of the region hasits blessings. All nations of the South Asianregion can cooperate in understanding andappreciating our difficulties and in extendinghands of friendship to one another.

Through this opportunity, I have greatpleasure in extending to all the dignitaries fromthe South Asian region the promise that India,as the country which postulated from timeimmemorial, �Lokah Samastah SukhinoBhavantu� (let the whole world be happy andprosperous), will not shy away from extendingany help in terms of our expertise, wisdom,friendship, love and understanding�.


15Why Food Security BillMakes Economic Sense

Arun Kumar*

Hindustan Times, August 20, 2013

The National Food Security Bill (NFSB) hasraised a political storm in India. Many are

worried about what its impact would be on farmprices, the growth rate and questions are beingasked whether there would be a sharp rise in thesubsidy bill and inflation rate once the NFSB isimplemented. Such confusion persists becauseanalysts ignore the impact the Bill will have onthe economy.

Hunger is not an individual problem but hasits roots in the country�s macroeconomics: thenature of employment generation and the termsof trade between agriculture and the othersectors.

The government, through its policies,determines these macroeconomic variables. Forinstance, in spite of high growth after 2003,hunger persists. Only the government can providethe correctives and end hunger. So the NFSB isonly a corrective measure to the other policiesbeing pursued by the government; it does notsolve the basic problem of income generation.

The NFSB will also raise demand for othergoods and give the sluggish economy a much-needed boost. This is because the availability ofcheap food grain will lower the food bill offamilies and they would spend the extra amountthus saved on other items. This amount could besubstantial since the poor spend 50�60 percentof their budget on food.

If it is assumed that an additional 30 crorepeople would get the cheaper food, the demandfor other items of consumption would risesignificantly, giving the sluggish economy a boost.

The rate of inflation for the poor would alsofall. But because the total consumption of foodwould rise, the free market price would also rise.That would hurt those not covered by the NFSB,like the lower middle classes.

The immediate rise in inflation, however,would be small because as of March 01, India�sfood stocks were 62.8 million tonnes and withthe procurement in the new season these wouldhave increased to above 80 million tonnes whilethe buffer stock norm for July 1 was only 27million tonnes. The higher free market pricewould lead to a higher price for the farmers andthis could lead to an increase in supply in comingyears.

Some argue that the poor do not need morefood grain but require other items of food. Thisis partially correct. Food grain availability (proxyfor consumption) in India peaked in 1991 at 510gms per person per day and declined after that(in 2001 by 18 percent).

This has been attributed to a shift in theconsumption pattern. Whenever the monsoonshave been bountiful and food prices havedropped, consumption has gone back to around500 gms. This suggests that the consumption

* Sukhamoy Chakravarty Chair Professor, Centre for Economic Studies and Planning, School of Social Sciences,Jawaharlal Nehru University


pattern has changed little and the need for morefood grains remains substantial. The NFSB wouldhelp the poor stabilise their consumption.

It is estimated that the subsidy bill on foodwould be around Rs. 1,25,000 crore (around onepercent of GDP). The additional amount overand above the current expenditure may bearound Rs. 30,000 crore. But, the requirementof storage would decline since food grains would

be distributed rather than kept in the open wherethey rot, and that would reduce the subsidy. Thereal problem would be corruption and theidentification of additional families to be coveredand delivery to them. In macroeconomic terms,the NFSB is desirable (with some amendments)and would reflect the nation�s commitment toits citizens.


16We�ll Meet Foodgrain Requirement under FSB

Sandip Das*

The Financial Express, August 21, 2013

The UPA government�s ambitious NationalFood Security Bill is slotted for passage in

the ongoing monsoon session of Parliament. TheBill envisages providing highly subsidisedfoodgrains to 67 percent of the country�spopulation. The Food Corporation of India (FCI)is expected to play anchor in ensuring thatsufficient foodgrain is available for theimplementation of the mega food securityscheme. C Vishwanath, chairman & managingdirector, FCI, spoke to Sandip Das on thechallenges the corporation is likely to face.

What are the logistical arrangements FCI ismaking for the implementation of the foodsecurity legislation?

The annual requirement of foodgrains to meetthe demand under the national food security lawis estimated at 61.2 million tonne (mt). As onAugust 1, the available foodgrain stock in thecentral pool is 69.61 mt (40.38 mt wheat and29.23 mt rice). The average procurement duringthe last 3 years has been 63.3 mt (29.6 mt ofwheat and 33.7 mt rice). Hence, there is sufficientfoodgrain to meet the requirements under theproposed law.

The storage capacity, as on July 30, stood at74.6 mt for foodgrains from the central pool. Thiswould be supplemented by about 20.3 mt withthe creation of both conventional and silocapacities by private sector participation underthe Private Entrepreneur Guarantee (PEG)scheme. We have already taken over facilities

totalling a capacity of 7.3 mt, while the rest isexpected to be ready in the next couple of years.Further, FCI will be adding capacity of 0.6 mt,especially in the difficult terrain of the north-eastern states, as is envisaged in the 12th Plan.We also have the option of hiring capacities fromprivate or public sector players, based on actualdemands.

Coming to transportation, the estimatedincrease is about 15 percent, which would be metin close coordination with the Railways. FCI isfully geared to meet the logistics requirementsfor the implementation of the proposed foodsecurity law.

Commission for Agricultural Costs and Prices(CACP) chairman Ashok Gulati has stated thata chunk of foodgrains is wasted because of FCI�sinability to store scientifically�

The storage issues have already beenaddressed. The stocks are stored by FCI in ascientific manner. Wheat stocks are stored incover and plinth (CAP), which is a proven andtime-tested method.

Relative to the quantum of our operations,the portion of grains that is considered spoilt ordamaged is minuscule. For example, the totalvolume of grains damaged in 2012-13 was 3,145tonnes, or 0.006 percent of the total quantityissued.

It is to be understood that grains are aperishable commodity. When we handle suchlarge volumes and store them for long periods oftime, a certain level of damage is inevitable. On

* Leading Columnist, The Financial Express


average, FCI moves about 3.5 mt of foodgrainsevery month over an average distance of about1,500 km, many times in adverse weatherconditions. However, we endeavour constantlyto keep the operational losses and damages tothe barest minimum.

Would there be a mechanism to ensure thatfoodgrains are available to FCI for procurementyear after year notwithstanding decline inproduction?

The quantum of procurement is directlyrelated to production and minimum support price(MSP). Over the last few years, the productionof foodgrains has either been increasing or stayedsteady. Though the current level of productionand procurement is satisfactory, the governmentof India is aggressively pursuing the agenda ofincreasing production further, especially in theeastern states of the country where there issignificant untapped potential. Concerted effortsare being made under the Bringing GreenRevolution to Eastern India (BGREI) scheme toleapfrog foodgrain production. FCI is alsoplaying its part in this by increasing the storagecapacities in these states and strengthening theavailable procurement apparatus. We areconfident that the supply position will match therequirements in the future.

Will the government have to importfoodgrains for the implementation of theproposed food security legislation if domesticprocurement falls short of the requirement?

Given the sturdy stock position and theincreasing or steady trends in procurement, wedo not foresee any such requirement. However,in the past, whenever there has been a shortageof foodgrain in the country, we have imported.We are committed to meet the requirements ofthe country and every possible action in thisdirection shall be taken as and when the needarises.

What improvements does the FCI need tomake in its infrastructure to ensure timely supplyto the states?

In the 50 years of its existence, FCI has neverfailed to meet the requirements of any state in

the country in terms of foodgrain supply. We areconfident that we will keep this impeccable trackrecord up in the future. Our infrastructure isconstantly improving to meet increasingdemands. For example, the storage capacityavailable for central pool stocks, which was 58.4mt as on March 31, 2010, is expected to reach81.1 mt by March 31, 2014, recording a growthof 39 percent over 4 years.

Please explain the financial implication of theimplementation of the food security law.

We estimate an additional implication ofabout Rs 24,000 crore in food subsidy once thelaw is implemented. The impact of the FoodSecurity Bill will stand at almost R19,000 crorefor FCI, assuming that we will be supplying about80 percent of the total quantity required. Theremaining portion will come from states underthe Decentralised Procurement (DCP)�this willbe applicable to states where DCP has beenimplemented (like Madhya Pradesh,Chhattisgarh, Orissa, Karnataka, etc).

Given that pending dues from the Centre is inthe excess of Rs 30,000 crore, how is FCI goingto raise funds for its operations following thepassage of the Bill?

We are requesting the government to allocatethe arrears in a supplementary budget or throughrevised estimates. The government has given usa �ways and means� advance of Rs10,000 croreto use till it clears its dues. We are also availingshort-term loans up to Rs 20,000 crore. With anobjective to reduce the cost of borrowing, wehave already approached the government toincrease the equity capital by Rs 8,000 crore andfor providing guarantee for issuing bonds worthRs 8,000 crore.

Will FCI�s borrowings go up because of theimplementation of food security law?

The additional subsidy requirement isestimated at around Rs 24,000 crore. If thegovernment provides adequate budgetarysupport for this amount, there may not be anyincrease in the borrowings by FCI. Otherwise wewill have to borrow more, either throughincreased food credit or through other optionslike short-term loans, bonds, etc.


Is FCI bringing in any structural ororganisational changes for the implementationof the the proposed food security law?

FCI is already managing the publicdistribution system (PDS) of the countryeffectively. Hence, no major structural ororganisational changes might be required toimplement the National Food SecurityOrdinance. However, as part of our efficiencyenhancement efforts, special emphasis is beinggiven to capacity-building of the workforce. Wehave also launched a scheme nurture and mentornext generation leaders, wherein the youngrecruits will be mentored by the seniors forsmooth and seamless assimilation into theorganisation.

Will FCI need to recruit a large number ofpersonnel for management of the requirementsof the food security law?

This is one area where a lot of work is beingdone. At present, we have 26,716 employeesagainst the sanctioned strength of 45,451. Thismassive shortage, of 18,735 employees, needs tobe filled, especially considering the expectedincrease in the scale of operations for effectiveimplementation of National Food SecurityOrdinance. Already, about 1,700 new recruitshave joined the organisation and about 8,000 areexpected to join by December 2013. We have setan ambitious target of filling the vacancies in thisfinancial year itself.


17Food Security Bill:

Why Blame the Poor and the Hungry?Harsh Mander*

Live Mint, August 26, 2013

The debates around the national food securityBill � which will create legal duties for the

state to provide food to citizens � have becomeoverheated and often deeply polarised. Some ofthe fiercest criticisms relate to the costs of thefood legislation, suggesting that a flounderingeconomy cannot afford the huge publicexpenditure required. It has also been argued thateconomic growth is a much more reliable andsustainable way to end hunger than public foodprovisioning.

The unease of those who worry that the lawis wasteful and populist stems from the high costsof the food law � an estimated annual burden ofRs1.25 trillion, they argue, is profligate, and willinflate deficits and fuel inflation.

These need to be taken with a pinch of salt.First, what is relevant is not the total but the

marginal increase in public expenditure that thefood Bill entails. This amounts to Rs25,000 crore,which seems a more reasonable expansion if weare convinced that what the law offers is a usefulpublic investment. Second, we can manage publicdeficits if we are willing to tax more. India�s taxto gross domestic product (GDP) ratio is lowerthan that of most industrialised marketeconomies. Further, it is excessively reliant onindirect instead of direct taxes, something that

burdens the poor disproportionately. India alsogives tax holidays amounting to Rs5 trillion everyyear to the corporate sector, and this is justifiedas necessary for wealth and job creation.

The overwhelming evidence from high growthyears is that this has been a period of virtuallyjobless growth, which underlines that there is nosubstitute for public investment to enhancelivelihoods. There is need also to enhance theintegrity of India�s tax efforts. All of this suggeststhere is considerable scope for taxing the rich toensure investments in the nutrition, health andeducation of the working poor.

Also, we need to weigh the costs of not makingthese investments, the enormous costs of hunger,preventable diseases and deaths on the moraleand productivity of several hundred millionworking people and growing children. Oxfordeconomist Sabina Alkire in an article (This Billwon�t eat your money, The Hindu, 29 July) offersa telling global comparison. She points out thatIndia �has a higher proportion of stunted childrenthan nearly any other country on earth, yetspends half the proportion of GDP that lower,middle-income Asian countries spend on socialprotection and less than one-fifth of what high-income countries in Asia spend.�

* Special Commissioner to the Supreme Court of India and Director of the Centre for Equity Studies. Ex member ofNational Advisory Council, where he convened the working groups on Food Security Bill.

The case against the food security Bill � that it is costly and itmollycoddles the poor � is deeply flawed


In lower, middle-income countries, theseexpenses are 3.4 percent of GDP. India�s is a merehalf of that at 1.7 percent and even this low levelis reached largely because of the rural jobsguarantee programme that ensures 100 days ofpaid work to all poor households in villages. Theaverage for upper, middle-income countries is 4percent of GDP and 10.2 percent for high-incomecountries. Japan spends 19.2 percent and China,5.4 percent. Even Singapore spends more thantwice as much as India, at 3.5 percent of GDP.

The criticisms of an expanded publicdistribution system are sweeping but deservecareful consideration. Management guruGurcharan Das feels that not only cheap foodwill disincentivise work, but the money that willgo into financing the food provisioning couldhave been far better spent in providing publicgoods such as roads, schools, power and law andorder. It would encourage entrepreneurs to startbusinesses, which would create sustainable jobsand raise the state�s tax revenues. These taxes,he suggests, would make it possible to invest inmore public goods. Thus, a virtuous circle wouldbe created and lift the society�s standard of living.

Again, such arguments miss the point. First,the belief that impoverished people will work lessif they are able to access cheaper cereals fails toacknowledge both the hard toil that characterise

the lives of millions of India�s poor, and the factthat like all of us they aim for much more than afull stomach. Moreover, spending on food is nota populist dole but an investment in India�sgreatest economic resource � its vast youngpopulation in the productive age-group �imperative for consolidating the gains of India�sdemographic dividend.

Every second child in India is malnourished,which means that the brains and bodies of everysecond young adult are not developed to theirfull potential. A well-nourished and well-educated workforce would be more productiveand have higher morale, the best guarantee tosustain higher economic growth. The savings onthe cost of cereals would place more disposableincome in their hands, and this enhancedspending by millions would stimulate growthfrom below. An assured expanded nationalmarket could stimulate agriculture, which stillemploys the majority of India�s food deprivedpeople.

The point is to consider not only the costs ofthe national food security Bill, but also the costsof not investing in the better nourishment ofmillions of our people. Growth cannot besustained much longer on the thin shoulders ofhungry people.


18Truth vs Hype:

Who�s Afraid of the Food Security Bill?Sreenivasan Jain*

NDTV, September 03, 2013

The Food Security Bill�s passage in Parliamentset off seismic levels of panic in the stock

markets. The Government on the other handseems to see it as a political game-changer. NDTVtakes a hard look at 4 big questions surroundingthe Bill.

Will the Food Bill Sink the Economy?

The cost of the Bill is highly contentious. TheGovernment claims it�s only going to costmarginally more than the existing food subsidybut others say hidden costs are not beingconsidered.

According to Food Minister Thomas, thecurrent food subsidy is Rs. 1.09 lakh crores.Adjusted according to the recent census, it willgo up to Rs1.13 lakh crores. The Food SecurityBill will according to him cost onlyanother Rs. 10,000 crores.

The Bill hopes to increase coverage from 45percent to 70 percent of the population withcheaper grain from Rs. 5 per kg to Rs. 2 perkg.But the minister says the grain needed isnegligible. He says currently we need 60 milliontons, and after the Bill, the increase will be 62million tons, just 2 million tons extra.That�sbecause the amount of grain being distributed iscoming down.

According to Thomas, from 35 per kg to afamily, it is down to 5 kg per person. So a wider

spread in terms of population, but a drop in theamount of grain.But not everyone is convincedby these numbers. The head of Government�sCommission for Agriculture Prices, says theircalculations suggest the government will spendnot Rs. 1.25 lakh crores, but almost double, thatis Rs. 2.4 lakh crores every year. The reportclaims the biggest expense: almost Rs. 66,000crores spent on the first year to increasingagricultural production, to meet the FoodSecurity Bill�s demands.

Thomas says, �Are we not bound to investmore in agriculture? This investment inagriculture is not because the Food Security Billhas come. We are bound to invest more inagriculture because we are an agriculturalcountry and we have to feed crores of people.�

In balance, it is fair to say that the FoodSecurity Bill will come at a cost, not significantlyhigher than what we already spend on the existingpublic distribution system. A more legitimatequestion to ask is, when poverty is shrinking, bythe government�s own estimates, why is the FoodBill expanding the scope of the PublicDistribution System?

The Food Minster says the government wasresponding to pressure from states that refuse toaccept the reduction in poverty. But activists likeReetika Khera say that the �Bill should not belinked to the poverty estimates because hungerand poverty are two different things. And even

* Journalist, NDTV. Inputs provided by Niha Masih


though both those things have been going downover a period of time, the fact is that many peoplestill remain very vulnerable to hunger and theirlives remain still very fragile.�

Will The Bill Solve Hunger?Some argue that the problem of hunger in

India has dwindled. The real problem ismalnourishment which the Food Security Billcan�t tackle since it provides only rice and wheat,not the more nutritious cereals and proteinsneeded to tackle malnutrition.

But defenders of the legislation claim it will.They say the bill includes maternity entitlementswhich will give Rs. 6000 for every pregnancy towomen for nutritional needs.

Even the Integrated Child DevelopmentScheme where children till the age of six getnutritional supplements like eggs, daliya inthe anganwadi, is now a law under the FoodSecurity Bill.

But there are concerns that the Bill will hastenthe decline of nutritious coarse cerealslike jowar and bajra (millets). Activist MilindMurugkar says, �In a state like Maharashtrafrom where I come or most of the dry landagriculture in India, the cereals are coarse cerealsand these farmers are in arid and semi-arid areaswithout irrigation. The farmers there don�t getany subsidy and on top of it, they have to facewhat we can call the dumping of subsidised PDSgrain.�

Will the Food Bill Create a GrainShortage?

Critics of the Bill worry that the additionaldemand of grain necessitated by the new law willcreate a food shortage. This in turn will pushthe government to import wheat and rice, whichwill hurt an already strained economy.

The government says 62 million tonnes neededto ensure food security for people targeted bythis bill is only a third of India�s annualproduction. The balance 70 percent will beavailable for the open market. But as some criticspoint out, making food an entitlement will needmeasures to ensure that there is no shortfall. This

may push up already high rates of agriculturallabour.

But that may be an upside to this law as theChairman of the Commission for AgriculturalCosts and Prices Ashok Gulati points out.

�In the last three years the labour cost alonein agriculture the farm wages are increasing 20percent per annum. Now that is great in one sensebecause the agriculture labour which is thebottom of the economic pyramid is getting wageswhich are much higher than the rate of inflation.�Gulati said.

Will the Food Bill Increase Corruption?The backbone of the Food Bill is the public

distribution system (PDS) which by thegovernment�s own admission is prone tocorruption. But it�s unclear how the Food Billwill repair the PDS, especially since this is in thedomain of the states?

Food Minister KV Thomas says there is a nine-point programme in the Bill to modernise thePDS. But the steps like doorstep delivery, de-privatising ration shops are all in the nature ofrecommendations.

Activists who support the Bill say that the twocompulsory clauses of the Bill - expandingcoverage and reducing prices - can reducecorruption. �When you reduce the price from thecurrent levels of 4 rupees and 6 rupees to 2 rupeesand 3 rupees, what happens is that people becomemore interested in the system And therefore I ammuch more likely to you know to fight with thedealer and try to get my full quota from him.And we have seen this happening in states likeChhattisgarh and Orissa and to some extent, noweven in Rajasthan,� Reetika Khera, an activistsaid.

Defenders of the Bill point to success storieslike Chhattisgarh, which has brought downcorruption dramatically by covering almost 70percent of its population with rice at Rs. 3 perkg and wheat at Rs.2 per kg. And as NDTVfound on the ground, it has meant a bigger rushon the ration shop and better accountability.

Chhattisgarh spends Rs. 1200 crores eachyear from its own pocket. But it�s success is notjust because of more coverage and cheaper grain.


The state is also taken a series of steps which arenot mandatory in the Food Security Bill- likehanding over control of the ration shops to grampanchayats and co-operatives, a highly efficientand heavily monitored back end supply chain, regular crackdowns on corrupt officials, alldriven by the Chief Minister Raman Singhhimself.

The success of states like Chhattisgarh, whichhave more to do with political will and less witha Food Bill, begs the question, how will a pieceof national legislation ensure that states like UttarPradesh, with the highest levels of corruption inits public distribution system in India, everbecome like Chhattisgarh?

UP currently has leakage of a whopping 57percent, largely unchanged over the years. Thenew bill will at best ensure that the state can cover70 percent of its population with steeply reducedrates of grain. But will this be enough to createenough pressure from below, to lessen corruptionand fix the problems plaguing their PDS?

To witness these NDTV didn�t have to go toofar. About 70 kms away from Lucknow, inUnnao district is Andheliya, a village of mostly

landless Dalits. For years some the villagers havenot got grain, like Ram Babu who has a familyof 9 and was issued a card in 2006 but receivedno ration till 2011. Finally with the help ofactivists and RTI the villagers got the ration shopowner raided and suspended. But no new shopwas appointed leaving them at the mercy ofsimilar corrupt ration shop owners.

At the state government�s godown whichstocks PDS grain for Andheliya, NDTV foundgrain lying in the open and the person in chargewith a political affiliation.

The bottom line is that there is no guaranteethat the Food Security Bill will lead to basket casestate�s like UP improving their inefficient PDSsystem. But at least, by widening the coverageand reducing price, might nudge them in thedirection of better performing states likeChhattisgarh and Tamil Nadu.

As Thomas told NDTV what was not awelfare measure is now a right. �There is asubstantial change between coming with a bowlwith a request �Give me rice� and now I can say�Bring the rice�. That is the difference.�


19The Food, the Bad and the Ugly

P Sainath*

The Hindu, March 22, 2012

Economic Editors� conferenceUnion Agriculture Minister Sharad Pawar

doesn�t just deal in foodgrain production, he dealsin records. Landmarks he�s fond of citing asfoodgrain production rises every year. (Barringblips like those in 2009-10, of course). Stickingto absolute numbers helps him maintain a modestsilence on another record he�s been a big part of.

The daily per capita net availability offoodgrain has been falling steadily anddangerously during the �reform� years. If we takefive-year averages for those years from 1992 to2010 � the figure declined every five yearswithout exception (see table �Declining percapita ��). From 474.9 grams of cereals andpulses for the years of 1992-96 to 440.4 grams

* Journalist and Photojournalist. Rural Affairs Editor for The Hindu and the website India Together

Average per capita net availability of foodgrain declined in every five-year period of the�reforms� without exception. In the 20 years preceding the reforms � 1972-1991 � itrose every five-year period without exception.

The country�s total foodgrain production is expected to touch a record 250 milliontons this year (2011-12).

Union Agriculture Minister Sharad PawarPTI, February 17, 2012

Record foodgrain output of 235.88 million tonnes in 2010-11.Sharad Pawar

PTI, April 6, 2011

India�s foodgrain production hit a fresh record at 233.87 million tonnes in 2008-09.Sharad Pawar, Lok Sabha

July 20, 2009

The Minister (Pawar) said food grain production in 2007-08 had reached a record227.32 million tonnes and record production has been achieved in a number of crops.

Economic TimesApril 23, 2008

�During 2006-07, the agriculture sector has posted new landmarks. The recordproduction of 216 million tonnes of food grains��

Sharad PawarNovember 13, 2007


for the period 2007-2010 (The 2011 figure is yetto come). A fall of 7.3 percent. There has notbeen a single five-year period that saw an upwardblip.

What about the 20 years preceding thereforms? That is 1972-1991? The per capitaavailability figure rose every five-year periodwithout exception. From 433.7 for 1972-76, to480.3 grams in 1987-91. An increase of 10.7percent.

Not reaching the needyConsider the average for the latest five years

for which data are available. It was 441.4 gramsfor the period 2006-2010. That�s lower than thecorresponding period half a century ago. It was446.9 for the years 1956-60. Not great news fora nation where malnutrition among childrenunder five is nearly double that of Sub-SaharanAfrica�s. (A point the India Human DevelopmentReport 2011 � from a wing of the PlanningCommission � concedes).

If production is rising, which it is; if the upperclasses are eating a lot better, which they are;and if per capita availability keeps declining,which it does � that implies three things at least.That foodgrain is not getting to those who mostneed it. That the gap between those eating moreand those eating less is worsening. And that foodprices and incomes of the poor are less and lessin sync.

It also tells us how disastrous the reforms-erapolicy of �targeting� through the PublicDistribution System has been. The poor have notgained from �targeting� in the PDS. They havebeen the targets. The �reforms� period has seenmore poor and hungry people shut out of thePDS in practice. The latest budget suggests that�targeting� is about to get more ruthless. Auniversal PDS covering all would cost much lessthan what the government gives away each yearin concessions to the corporate sector.

Small wonder that Pawar sticks to aggregatenumbers in his claims of records. He stays withproduction in absolute numbers, because that�srising. As the Big Boss of Cricket in India (andthe planet) Pawar would not be satisfied withtotalling up how many runs a batsman of hismakes. He�d divide it by the number of innings

the batter has played. He�d perhaps even look atthe number of balls he faced, strike rate and soon. But when it comes to his boss role onfoodgrain, aggregate figures will do. The bignumbers look so nice. Why complicate things bylooking at how much foodgrain is available perIndian? That too, per day or year?

Economic Survey documentFor those worried about food availability,

though, it matters. The highest figure for any yearin our history was the 510.1 grams for 1991.Aha! Chalk one up for the reformers? Not really.The data are based on the agricultural year � i.e.July to June. So the 1991 figure corresponds tothe production of July 1990 to June 1991.Manmohan Singh made his speech launching thereforms on July 24, 1991. And the average for2010, after nearly two decades of �reforms,� was440.4 grams.

The decline across the reforms years has beendismal. Indeed, some five-year periods in this eracompare poorly even with those in the pre-GreenRevolution years. For instance, 2006-10 throwsup worse figures than 1956-1960. All figuresfrom 1961 are seen in the latest Economic Surveyof 2011-12. (http://indiabudget.nic.in/es2011-12/estat1.pdf See A22, 1.17. Last year�s survey hasdata going back to 1951.

This, of course, is the point at which someonepops up with: �It�s all due to the population. Thepoor breed like flies.� Is it? The compoundannual growth of population was much higherin pre-reform decades than it is now. But theCAGR for food production was always higherand ahead of it. Even in 1961-1971, when theCAGR for population was 2.24 percent it was2.37 for grain production. In 2001-10, the figurefor population was just 1.65 percent. Butfoodgrain production lagged behind even thatfigure, at 1.03 percent. (For the growth rate infoodgrain, we have not taken 2010-11 intoaccount. We have only advance estimates for thatyear and these can vary quite a bit from finalfigures).

In all the southern states the fertility rate iseither at replacement level or even below it. Andthe population growth rate is falling everywherein the country, and at quite a rapid pace. Yet,


per capita availability has declined. So thepopulation claim does not fly. There may be one-off years in which the growth rate of foodproduction (or even per capita availability) getsbetter, or much worse. Hence, looking at five-year or decadal averages makes more sense. Andthe trends those show are awful.

This is a context where foodgrainproduction per capita is on the decline. Where,however, the buffer stocks with the governmentin fact show an increasing trend. So per capitaavailability is in fact declining at a faster rate. Itmeans the poor are so badly hit that they cannotbuy, or have access to, even the limited grain onoffer.

GHI rankingTrue, this will invite yowls of rage from the

Marie Antoinette School of Economics (or �Let-them-eat-cake� crowd). For them the decline onlyshows that people now care less for cereals andpulses. They�re eating much better stuff sincethey�re doing so much better. So much better thatwe�d be lucky to reach Sub-Saharan Africa�s rateof child malnourishment in a few years. Or

improve enough in the Global Hunger Index(GHI) to challenge an upstart Rwanda in a fewyears. Presently we rank 67 in the GHI (out of81 countries with the worst food security status).Rwanda clocks in ahead of us at rank 60. India�sGHI value in 2011 was worse than it was 15 yearsbefore that in 1996.

We�ve spent 20 years promoting cash cropsat the expense of food crops. No one knows quitehow much land has been converted from thelatter to the former, but it would run to lakhs ofacres. As food crop cultivation has grown lessremunerative, many have abandoned it. Asfarming tanks across large swathes of thecountry, more and more land lies fallow. Theowners have given up on the idea of making aliving from it. Close to seven-and-a-half millionpeople quit farming between 1991 and 2001 (andwe still await the figures for 2001-11).

Two decades of policies hostile tosmallholders, but paving the way for corporatecontrol, have seen public investment inagriculture crash. No surprise then that foodgrainproduction is �growing� only in absolutenumbers but falling at an alarming rate in percapita terms.


20Let us not Rush into Cash Transfers

The Hindu Business Line, December 27, 2012

We support cash transfers such as old agepensions, widow pensions, maternity

entitlements and scholarships. However, weoppose the government�s plan for acceleratedmass conversion of welfare schemes to UID-driven cash transfers. This plan could cause havocand massive social exclusion. We demand thefollowing:1. No replacement of food with cash under the

Public Distribution SystemThe PDS is a vital source of economic securityand nutrition support for millions of people.It should be expanded and consolidated, notdismantled.

2. Immediate enactment of a comprehensiveNational Food Security Act, includinguniversal PDSInstead of diverting the public�s attention withpromises of mass cash transfers before the2014 elections, the government should redeemits promise to enact a National Food SecurityAct (NFSA).

3. Cash transfers should not substitute for publicservicesWhile some cash transfer schemes are useful,they should complement, not substitute forthe provision of public services such as healthcare, school education, water supply, basicamenities, and the PDS. These services remaingrossly under-funded.

4. Expand and improve appropriate cashtransfers without waiting for UIDThere is no need to wait for UID to expandand improve positive cash transfer schemessuch as pensions, scholarships and maternityentitlements. For instance, social securitypensions should be increased anduniversalised.

5. No UID enrolment without a legal frameworkMillions of people are being enrolled for UIDwithout any legal safeguards. The UIDAI�sdraft bill has been rejected by a parliamentarystanding committee. UID enrolment should behalted until a sound legal framework is inplace.

6. All UID applications should be voluntary, notcompulsoryUID should never be a condition for anyoneto access any entitlements or public services.A convenient alternative should always beavailable.

7. UID should be kept out of the PDS, NREGAand other essential entitlement programmesfor the time beingEssential services are not a suitable field ofexperimentation for a highly centralised anduncertain technology. Other applications (e.g.to tax evasion) should be tried first.

* Letter by various authors: Reetika Khera, Jean Dreze, Nikhil Dey, Bina Agarwal, C.P. Chandrashekhar,Hinamshu, K.P. Kannan, Lawrence Liang, R. Nagaraj, Medha Patkar and about 200 others.


Explanatory Note:Why we Oppose the Rush to Cash Transfers andUID: We support cash transfers such as old agepensions, widow pensions, maternity entitlementsand scholarships. In fact, many of us have beenpart of struggles to expand social securitypensions and improve their delivery. We alsosupport appropriate, people-friendly uses ofmodern technology for this purpose.

However, we have serious reservations aboutthe government�s rush to link these cash transfersto �Aadhaar�, the unique identity (UID) number.This is because the linking of these schemes cancause huge disruption � think of an old man whois currently getting his pension from the local postoffice, but will now have to run around gettinghis �UID-enabled� bank account activated andthen may find his pension held up by fingerprintsproblems, connectivity issues, power failures,truant �business correspondents�, and what not.

We are also firmly opposed to the introductionof cash transfers in lieu of food and othercommodities supplied through the PublicDistribution System, for many reasons. One,subsidised food from the PDS is a source of foodand economic security for millions of poorfamilies.

In 2009-10, implicit transfers from the PDSwiped out about one fifth of the �poverty gap�at the national level, and close to one half of it inStates like Tamil Nadu and Chhattisgarh.

Recent experience also shows that it is possibleto further revamp and reform the PDS withoutdelay.

Two, the banking system in rural areas is notready to handle large volumes of small transfers.Banks are often far and overcrowded. The allegedsolution, banking correspondents, is fraught withproblems. Post offices could possibly beconverted into useful payment agencies, but thiswill take time.

Three, rural markets are often poorlydeveloped. Dismantling the PDS would disruptthe flow of food across the country and put manypeople at the mercy of local traders andmiddlemen.

Four, there are concerns of special groups suchas single women, disabled persons and the elderlywho cannot easily move around to withdrawtheir cash and buy food from distant markets.Last but not least, inflation could easily erodethe purchasing power of cash transfers. Whenthe government refuses to index pensions orNREGA wages, how can it be trusted to indexcash transfers to the price level?

The Kotkasim fiasco is a telling example ofthe potentially disruptive effects of inappropriatecash transfer schemes.

The experiment was launched with muchfanfare and immediately projected as a �stunningsuccess� based on the fact that kerosene subsidyexpenditure had declined by 80 percent, but infact, the main reason for this decline was thecollapse of the entire kerosene distributionsystem.

An impression has been created that thegovernment is all set to launch UID-enabled cashtransfers on a mass scale before the 2014elections.

This is very misleading, and looks like anattempt to make people rush to UID enrolmentcentres. This announcement also diverts attentionfrom the government�s failure to enact a NationalFood Security Act.

The Food Security Bill, very weak in the firstplace, has been languishing with a StandingCommittee for a whole year. Meanwhile, foodstocks are accumulating on an unprecedentedscale.

The need of the hour is a comprehensiveNational Food Security Act, not a potentiallydisruptive rush for UID-driven cash transfers.


21Thomas for Private Help in

Foodgrain ProcurementBusiness Standard, April 04, 2013

Food Minister K V Thomas said a mechanismwas being worked out with major industry

associations to ensure that the participation ofthe private sector was enhanced in foodgrainprocurement operations, as the governmentprepared for a surge in 2013-14 annual wheatprocurement by almost 6-8 million tonnes ascompared to last year.

�In 2013-14, the government is expected toprocure around 44-46 million tonnes of wheat,which till last year, was around 38 million tonnes,while the requirement is just around 26-27million tonnes. Hence, it is the government whichhas become the biggest buyer of foodgrains, asprivate companies are absent since the last twoyears from major wheat and rice producingregions, which has to change,� Thomas toldreporters on the sidelines of a discussion on�India�s food security and the Second GreenRevolution�. The discussion was part of theannual general meeting of the Confederation ofIndian Industry.

Thomas said the private sector, too, could notescape being blamed, as it had a tendency of notpurchasing wheat and rice when supplies wereabundant and then want the government toliquidate its inventories at cheap rates. �Privatetraders, too, have some social commitment andyou cannot purchase foodgrainis at belowMinimum Support Price (MSP) rates,� Thomassaid.

�This is a scary situation and we cannot allownationalisation of the country�s foodgrain trade,as we have stopped proper market operations anddriven away private traders from India�s graintrade,� said Chairman of Commission forAgriculture Costs and Prices, Ashok Gulati. �Theproposed National Food Security Bill seeks toachieve equity concerns through a price policy,which I as an economist feel is a major lacunae,�he said.

Agriculture secretary, Ashish Bahuguna, whoalso participated in the discussion, said, �Ourfarmers have ensured that India would remain afood-secure nation for some time to come...�, butthat has not guaranteed income security tofarmers. Average income from agriculture ismuch less than average income from non-agriculture sources. Therefore, we have to reducethe burden on farming and facilitate themigration of more and more people from ruralareas or create adequate opportunities in the non-farm sector,� Bahuguna said.

He also streesed on the need for cropdiversification and said the newly-announcedNational Mission on Crop Diversification wouldencourage farmers to switch to crops like maizeand mustard in traditional wheat-growing areas.�Cash transfer would also form part of theMission,� Bahuguna said.

Ajay Jakhar, chairman of Bharat KrishakSamaj, blamed the government�s policies for

Private sector too cannot escape being blamed as theyhave tendency of not purchasing wheat and rice

when supplies are abundant


being the greatest hindrance to cropdiversification and higher farmers� income. �Whydoesn�t the government make farmers self-sufficient, so that the poor ones do not require asocial security net like the National Food SecurityBill?� Jakhar asked.

Criticising Ashok Gulati�s contention thatMinimum Support Price (MSP) cannot be just

decided by the cost of production, and thedemand side of the produce will also have to belooked into, Jakhar said that while it is acceptedthat the cost of production alone cannot be thesole criteria for determining the MSP, it must alsobe understood that the production cost of farmershas increased manifold in the last few years.�


22Food Security Ordinance

� Analysis and RecommendationsByomkesh Lal*

Note by ActionAid, August 06, 2013

A couple of months ago, The HonorablePresident of India promulgated an

Ordinance on the National Food Security thatseeks to give legal rights to 67 percent of thepopulation over subsidised grains every month.

The detailed version of ordinance can befound here. The beneficiaries will be identifiedby the States, which will also implement theprogramme under the Targeted PublicDistribution Scheme.

The ordinance will have to be ratified withinsix weeks of the commencement of the nextsession of Parliament. As we prepare this note,the monsoon session of the parliament has justbegun and this is certainly one of the mostimportant of issues to find its space in thediscussions in this session.

It is also important to note that in the electionpromises of United Progressive Alliance in 2009,ensuring Food security within 100 days ofsecond-tenure, was high on the list. We are almostat the end of that tenure before the discussionhas finally reached the parliament.

The food security act could have been aculmination of the long struggle to ensure ahunger and malnutrition free India.

However, in its present form, the Ordinanceis being opposed by the Right to FoodCampaigners (constituting a large number ofgrassroot organisations across India) on variouscounts.

The suggestions made by the campaignersinclude a further increase of entitlements that arebeing proposed as well as a broadening of thescope of the concept of �right to food� itself, soas to include crucial issues such as land,agriculture and water.

It needs to be noted that, all this is happeningin a situation where certain vested interests havestepped up their campaign in reducing theproblem of mal-nutrition in India to an an illusoryone, resulting from bad measurement!

There have been strong criticisms about thegovernment taking the ordinance route on animportant issue like the Food Security. Some haveeven termed it a way of short-circuiting informeddebate in the parliament.

An ordinance is an executive order to passlaws when Parliament is not in session. It remainseffective for six months from the date of passagewithin which period it must be replaced with apermanent law that needs to be passed by bothhouses of Parliament.

However, various criticisms notwithstanding,the fact remains that even in its somewhat limitedscope, this Ordinance is a groundbreaking oneand will have a positive impact across the nation.

It could be seen as a first step towards theultimate goal of a comprehensive (and universal)food security act. Experts also believe that accessto subisidised food would help the poorbeneficiaries save on food expenditures and leave

* Programme Manager, ActionAid, India country office


more disposable income in the hands of thebeneficiaries to do more spending on health andeducation.

In this context, it becomes exceedinglyimportant that ActionAid India through itspartners and ongoing campaigns take a proactivestand supporting the broad advocacy positionsof the nationwide Right to Food Campaign, andits efforts to convince the government to makepositive revisions in the Ordinance andincorporate a specific timeframe forimplementation.

Limitations of the Current VersionThe Ordinance�s narrow vision on the

prerequisites of food security, restricted mainlyto grain entitlements under the existing PublicDistribution System, need to change significantly.

According to NCRB data, more than 2,50,000farmers have committed suicide after 1995 inrural India. In this situation, a right to foodlegislation that does not address the ongoingagrarian crisis in the countryside will remainseverely limited in its scope.

In addition, it is observed by various advocacygroups across the country that the focus of thelegislation remains only on the access andavailability aspects of the right to food and noton the nutritional dimension.

More worryingly, important socialdeterminants like access to healthcare, drinkingwater, sanitation, etc. have been completelyignored.

There are fears expressed from variousquarters that commercial interests will beencouraged in the procurement and distributionof food entitlements in contravention to manyexisting Supreme Court orders.

It is indeed a grave situation and the �Right toFood Campaign� needs to be strengthened withmobilisation of people and opinion around theissue, so that the problem of hunger is addressedby the government at a more fundamental level.

We endorse the various issues raised by theRight to Food Campaign in its recent press releasewhich urged the UPA government to bring theOrdinance through only after sufficient debateand discussion in Parliament.

RecommendationsThe broad aspects of the National Food

Security Ordinance that need attention are listedout below:� Production & Procurement Issues: The

ordinance, even if it eventually becomes anAct, will remain a food entitlement Act andnot legislation in line with the right to food. It fails to address the production orprocurement related issues, issues related torelief to farmers, or the larger determinantsto right to food. It must be noted that thekey social determinants to malnutrition areleft out completely from the legislation.

� Endangering PDS? - Even though UPA-2promised to bring in a law that would ensureevery household received at least 35kg of grainper month from the public distribution system,the current ordinance does not propose anyreturn to universal PDS. Instead, it now createsa new classification that puts the cut-off at 67percent. No more than 75 percent of the ruralhouseholds, and 50 percent of theurban households, can come under the ambitof right to food.

� Realistic Timelines to Map Eligibility: Section10 of the ordinance which discusses theidentification of the eligible householdsmandates the state governments to identify theeligible households within 180 days after thecommencement of the Ordinance. It is ironicalwhen the central government has taken nearly2 years to complete the socio-economic andcaste survey (still not over) and expects statesto identify the eligible households in a periodof 180 days. Hurrying the beneficiaryidentification process will defeat the purposeof the Ordinance to provide food security tothe poorer section of the population.

� Risks of Unfair Exclusion: These householdswill get only 5 Kg foodgrains per person permonth and not 35Kg per household per monthas promised before. The rest of the householdsare totally excluded from entitlements underPDS, and will have no right to food. Suchtargeting are indeed prone to well-known


errors of unfair exclusion and unjustifiedinclusion. What we need is a PDS free of allarbitrary cut-offs, and which is trulyuniversal. It needs to be kept in mind thatthe ICMR norms recommend that an adultrequires 14kgs of food grains per month. Theminimum requirement of a person must betaken into account while the allocation of foodgrains is determined.

� Section 32 is Welcome: The ordinance saysthat State governments, if they want,can increase the coverage at their own cost.This is both meaningless and unfair to thoseState governments that already run awidespread, near-universal and efficient PDSlike Tamil nadu, Kerala, Chhattisgarh andOrissa. It is feared that this legislation willaffect the price at which the centre sells grainto the states, and those already with largerprogrammes will end up having to buy fromthe open market to top up their requirements.However, section 32 of the ordinance is awelcome step which states that this legislationdoes not preclude the state and centralgovernment from continuing or formulatingother food based welfare schemes.

� Ensure Local Production: Section 23 of theordinance which allows for fund transfer fromthe centre to states in situations of short supplyof foodgrains is problematic, as it paves wayfor the central government to abdicate itsresponsibilities regarding foodgrainproduction. A situation where the changingclimate makes food deficit years and droughtyears a recurring possibility, it wouldencourage a minimalist state buying its wayout of a strong presence in agriculture. Rather,the central government should discuss andcollectively work out a strategy andoperational plan to ensure local food grainproduction. All the programmes/Missions onagriculture/food production such as RKVY,NFSM, MHM, etc. may be propelled in lineof the Ordinance to realise the objective offood security in a time bound manner.

� Address Vulnerable Groups: The legislationhas left out special provisions for marginalised

groups whose access is severely compromisedwhich were addressed � albeit partially � inthe previous versions of the Ordinance,whittled down subsequently. Section 30 ofthe ordinance which discusses needs moreclarity in terms of government�s commitmentto pay special focus to the needs of vulnerablegroups residing in remote and difficult toaccess, hilly and tribal areas for ensuring theirfood security. Unless these groups areidentified as eligible beneficiaries of thisordinance, they would not be able to benefitfrom this.

� Mid-Day Meal During Holidays: Section 5bof the ordinance talks about food andnutritional security of children up to class VIII.It should also provide free mid-day mealduring holidays in the case of droughtdeclaration/humanitarian emergencies likefloods, and other natural calamities when thepoor households need it the most.

� Direct Cash Transfer Detrimental: The foodsecurity allowance�s provision made in theordinance is problematic. There is well-founded apprehension that the government,in the long run might abdicate theresponsibility of supplying food grains andresort to cash transfers which would leave thepoor beneficiaries at the mercy of the marketforces. The clauses that allow for direct cashtransfers in the place of food grains shouldbe removed. Also, there is the risk of such amove undermining the production/yieldpotential of our farming community in thecountry whose farming rights and entitlementswe have been relentlessly demanding for.

� Address Nutrition Issues: The Section 31 ofthe Ordinance which discusses provisions foradvancing food security remains quite sketchyand unclear about the measures to be takento progressively realise the objectives ofadvancing nutritional and food security in theSchedule III of the Ordinance. It seems thatto pacify the demands of the farmers�organisations and the national campaign, theschedule has been written in a vague mannerwithout mention of any commitment from the


central government to protect the rights of thefarmers and to address the plundering ofresources like land, water and commons.

� Decentralise Grievance Redressal: Thegrievance redressal system mentioned in theordinance places officials at district level,whereas the vast coverage of the Ordinancecalls for further decentralising the process ofgrievance redressal by placing adequatenumber of human resource even at the panchayat level.

ActionAid India has been in completesolidarity with the nationwide movement forthe Right to Food, over the last decade or so.

We have been an active part of the campaigndemanding a comprehensive food security act� both at the national level and in terms ofstate level initiatives and public action.Our partners and various peoples� formationspromoted and supported by us have beenstrengthening the campaign across thecountry.

We urge everyone to be part of the publicdebates and campaigns that aim atstrengthening the Ordinance, and help makethis historic legislation more inclusive andresponsive.

Section II

Post-enactment of theNational Food Security

Act of India


23Food Disaster Waiting to Happen

KD Singh*

The Pioneer, September 23, 2013

In 2009, the UPA2 Government led by theIndian National Congress promised the

country pro-people policies � policies whichwould first and foremost take into account theneeds of the poor. Unfortunately, it has takenthis regime almost four years to pass its firstmajor pro-people policy (if we leave out TheRight of Children to Free and CompulsoryEducation Act and the Mahatma GandhiNational Rural Employment Guarantee Act),when the Lok Sabha passed the National FoodSecurity Bill, 2013.

Despite all the political baggage that the foodsecurity programme is intended to carry for theCongress and the UPA, it truly is a first exampleof �noblesse oblige� displayed by the Government.The programme intends to guarantee fivekilogram of rice, wheat and coarse cereals permonth per individual at a fixed price of three,two and one rupees respectively, to nearly 67percent of the population � that is almost 830million individuals. According to Congresspresident Sonia Gandhi, this Bill will bring aboutan �empowerment revolution� fulfilling herparty�s promise to wipe out hunger andmalnutrition.

At this point, the question needs to be asked:Can the programme in its present form actuallyattain this goal? On top of this, the timing as

well as the intent of the Bill are also questionable.The promise of food security was one of themajor agendas of the UPA�s 2009 electioncampaign. Then why was postponed till the endof the term? It only enforces the fact that theCongress-led Government is using thisprogramme for some political traction in thecoming elections. Also, the way the Bill standsright now; it clearly is just a repackaging of thealready present Targeted Public DistributionSystem.

All this left aside; the Bill to some level is evendesirable in our present context. But, as anobjective observer you cannot help but notice theobvious cons of this policy. Let�s keep theeconomic aspect aside and focus first on theimplementation side of this policy. The foodsecurity programme will be implemented throughthe existing TPDS infrastructure. It is well-knownand supported that our public distribution systemis extremely �leaky�.

India introduced targeted food subsidies in1997. In the current TPDS, subsidies depend onwhether the household is classified as abovepoverty-level, below poverty-level or poorest ofpoor or Antyodaya Anna Yojana. However,improper targeting, inclusion errors and illegaldiversion of subsidised grains all add to massiveleakages. According to an Asian Development

* Rajya Sabha MP

UPA2 regime�s flagship programme on the �right to food� is slatedto create more problems than it will solve, once it kicks off across

the country. A creaky public distribution system and the weakeconomy will not be able to sustain the scheme


Bank study in 2004-2005, 70 percent of the poorreceived no grain through the TPDS while 70percent of those who did were non-poor.

In the same year, 55 percent of subsidised foodgrains leaked out along the distribution chain.In its decomposition of subsidies in India, thestudy estimates that income transfer to poor wasa meagre 10 percent; on the other hand the non-poor received 19 percent. The Commission forAgricultural Costs and Prices also paints a grimpicture of the present TPDS. According to themthe public distribution system has leakages of 40percent.

With this in mind, when in the next fewmonths the food security programme isimplemented by the States in full swing, theprobable outcome would be more leakages.Unless in these few months the Government cansomehow increase the participation rate of thepoor; enhance the fraction of subsidy going tothem; trim diversion and excess costs; andultimately reduce programme waste.

The problem is, if these goals were notachieved in the past 15 years since the TPDS wasfirst introduced, the addition of this Bill will onlyexacerbate the present condition. The draftersof the Bill should have taken lessons fromsuccessful implementation of food security fromStates like Chhattisgarh, whose Food andNutrition Security Act of 2012, has been praisedfor reducing the amount of grain lost throughcorrupt practices.

The next important aspect, probably the mostcrucial one is the economic consequences thatthe food security programme will bring about.The Government estimates the burden on theexchequer at Rs 1,25,000 crore. But this estimateis contested by many. According to the CACP,the Government is looking at an expenditure ofRs 6,82,163 crore over a period of three years(Rs 2,27,387 crore/year). Others like economistSurjit S Bhalla peg the expenditure at Rs 3,14,000crore per year, which is almost equivalent to threepercent of India�s GDP.

In fact, the Government�s estimates fallswoefully short because, during the

implementation of a policy, various other costsget associated. Just to name a few, there wouldbe an additional cost on warehousing-relatedaspects; logistical costs, agriculture productionenhancement costs, infrastructural costs forsetting up a grievance redressal mechanism. Ontop of these, costs relating to TPDS leakages andits reform also need to be considered. But,estimating the cost of a policy is not the importantpoint and that is why there is the concept ofrevised estimates. What is important is the effectof that policy�s expenditure on the economy ofthe country as a whole.

According to India�s Budget Estimates forfiscal year 2013-2014, total receipts is pegged atRs 11,22,799 crore and total expenditure at Rs16,65,297 crore, leaving the country with a fiscaldeficit of Rs 5,42,499 crore. So far, three monthsinto the fiscal year the Government has onlyrealised 11.1 percent of the estimated revenuereceipts.

If we analyse the Government estimate for thefood security programme, it comes up to 11.13percent of the total receipts. The CACP�s estimateputs the cost of food security programme at 20.2percent. This gives us a fair idea of how large theexpenditure under food security programme willactually be. Since the Government�s realisationof receipts has been slow, the percentage ofexpenditure will only increase.

Given that the economy is on a bearish trend,the biggest concern for the Government, asbefore, will be the fiscal deficit. The expenditureson a large policy such as the food securityprogramme will add a sizeable chunk to the fiscaldeficit, which would need to be financed. Thereare various ways a Government can financegrowing fiscal deficit. But, in a slow economythe solutions are even more difficult and canfurther add to the slump. One way or the other,in the foreseeable future, the introduction of thefood security programme will hamper economicgrowth. Its prime goal of eliminating �hunger andmalnutrition� remains questionable.


24North-eastern States Plead

Inability to Roll Out Food LawGargi Parsai*

The Hindu, November 10, 2013

A majority of States in the northeast haveconveyed to the Central government that it

is not �practical� for them to roll out the UnitedProgressive Alliance�s �game-changer� foodsecurity law for lack of resources, manpower andinfrastructure.

Alarmed at the admitted ill-preparedness ofthese States to implement the food law, the Centrehas deputed Union Food Minister K.V. Thomasto hold urgent consultations with them. TheMinister is flying down to Guwahati with a high-level team of officials and has convened a two-day meeting with the Food Ministers ofArunachal Pradesh, Assam, Manipur, Mizoram,Meghalaya, Nagaland, Tripura and Sikkim.

No door deliveryArunachal Pradesh, Assam, Manipur and

Mizoram have candidly told the Centralgovernment that it is not possible for them tomake door delivery at fair price shops as they donot have the resources or manpower. Nagalandhas said that it is not practical for it to do doordelivery due to the �topography� of the State.Tripura plans to introduce mobile vans. OnlySikkim said it had opened 25 godowns to storefoodgrains for the public distribution system.Under the new system, States have to createintermediary points for storing four months� offoodgrain stocks.

All the seven States and Sikkim havedemanded more foodgrains allocation as they

have �negligible� local production of cereals. Thegovernment is bound by the Act to providesubsidised wheat or rice or coarse cereals to 75percent rural and 50 percent urban population.Only identified beneficiaries are eligible to receive5 kg of rice or wheat or coarse cereal at Rs. 3,Rs. 2 and Re 1 per kg every month.

Based on their offtake in the last three years,but for Manipur, the northeastern States will tendto lose their allocation under the Act. But theCentre has given an assurance in Parliament thatit will not cut the allocation of any State for threeyears.

Implementation left to StatesThe Food Ministry has pointed out that under

the new law, implementation of the programmeis with the State governments through local self-government bodies, which must be strengthened.The States have to evolve a proper criterion andmechanism to identify the beneficiaries. Theyhave to set up grievance redress bodies andvigilance committees at district and State levels.

It is incumbent upon States to computerise thePDS with digitisation of database andcomputerisation of the supply chain forimplementation of the Act. So far only Delhi,Haryana and Uttarakhand have indicated theirreadiness to implement the law. Poll-bound Delhihas said it will do it in phases.

* Senior Journalist, The Hindu


25Food Subsidies Need Protection

from Coercive WTO Rules: SharmaPuja Mehra*


Unless India�s minimum support prices forfarmers and food subsidies are safeguarded

against the rules of the World TradeOrganisation, the Ninth WTO Ministerialscheduled for next month in Bali could fail,Commerce and Industry Minister Anand Sharmahas warned.

Mr. Sharma told WTO Director-GeneralRoberto Azevedo on the phone that an outcomein Bali that addressed only the proposals of thedeveloped countries would not be acceptable toIndia, according to sources in the government.

The Minister has sought an urgent meetingof the Cabinet Committee on WTO as thecountry�s administered MSP was at �serious riskof breaching� the WTO�s permissible subsidylevels. �Our estimation shows that India willexceed de minimis,� top Commerce Ministryofficials told The Hindu.

Over the past weeks, India was locked inhectic negotiations in Geneva with the richcountries to find a way to permanently safeguardits food security and food subsidies from WTO

disciplines. One of the most fiercely contestedproposals in the Bali package is the one onpermissible levels of subsidies in agriculture.

India has not managed to have its preferredposition included in the draft for Bali. Proposedamendments will be reviewed on the morning ofDecember 5, after which the final text will besubmitted for the Ministerial.

Though the draft did not offer a permanentsolution, it did propose a peace clause that offeredIndia a breathing space on its MSP and foodprocurement programme until the 11thMinisterial, the officials said adding that theclause provided that no country would be ableto initiate action against another that was inbreach of the WTO caps.

�The peace clause averts the possibility ofIndia�s food security law running afoul of theWTO�s Agreement on Agriculture but not againstthe Agreement on Subsidies and CountervailingMeasures for which negotiations are going on inGeneva,� an official said.

* Assistant Editor, Businessworld

�An outcome in Bali that addressed only the proposals of thedeveloped countries would not be acceptable to India.�


26India Rejects WTO Peace Clause Proposal

Puja Mehra*


At a meeting between Prime MinisterManmohan Singh and Commerce &

Industry Minister Anand Sharma it was agreedthat India cannot agree to the Peace Clause foragriculture subsidies that the World TradeOrganisation (WTO) Director-General RobertoAzevedo has proposed for Bali.

In no situation can India�s food security bedictated, said Singh at the meeting, according tohighly-placed Commerce Ministry sources. ThePrime Minister�s instructions are that �India willnot agree to any deal at Bali until it is certainthat the proposed interim solution will beavailable till a permanent solution to the issue ofIndia�s minimum support prices (MSP) breachingthe WTO norms has been found and agreed to,�the officials told The Hindu.

The Commerce Ministry plans to seek theCabinet�s approval for this position at Bali. �Thefood subsidies under the Food Security Act weare not even discussing...that�s our sovereignspace,� Sharma told The Hindu. India isnegotiating in Geneva safeguards for itsadministered MSPs. �The MSPs will only risewith the roll out of the Food Security Law,�Sharma said.

The deal breaker for India is the lack of clarityon when the proposed Peace Clause, an interimsafeguard for MSPs in breach of the WTO caps,will expire. India, said the officials, also cannotafford to not have any deal at all at Bali for thenthere will be no safeguards against the breachesof the WTO caps.

The text for Bali, a copy of which The Hinduhas accessed, states that the Peace Clause �willremain in force until the 11th MinisterialConference, at which time we will decide on nextsteps in view of the General Council�s furtherreport on the operation of this Decision and ofthe Work Programme decided in paragraph 7.�

�The clause can imply that should no solutionor agreement be reached at the eleventhMinisterial conference, the protection from thePeace Clause will end and its extension will behave to be renegotiated � an eventuality Indiadoesn�t want,� said a senior Commerce Ministryofficial.

Work programmeThe Work Programme, according to the text,

is to �be undertaken in the Committee onAgriculture to pursue this issue with the aim ofmaking recommendations for a permanentsolution.�

The Peace Clause is conditional on fulldisclosures on the MSPs that are at risk or havebreached the WTO limits and the annualprocurements undertaken for food securitypurposes for each public stockholdingprogramme.

On November 11, Sharma wrote to the UnitedStates Trade Representative Michael Froman�...excessive conditionalities imposed on a PeaceClause would lead to serious concerns that wewill be required to change our domestic policy.�

* Assistant Editor, Businessworld

In no situation can India�s food security be dictated, says Manmohan


27Hungry for Change


In the wake of the passing of the National FoodSecurity Act, Ertharin Cousin, Executive

Director of United Nations World FoodProgramme (WFP), visited New Delhi last weekon the invitation of the Ministry of Agriculture.Seeking to engage and enhance WFP�s strategicpartnership in a country that is home to over aquarter of the hungry people in the world, andranks 63rd on the Global Hunger Index releasedon 14 October 2013, Cousin met with a numberof important policy makers, including K.V.Thomas, Minister of State (Independent Charge),Ministry of Food, Consumer Affairs & PublicDistribution and Sharad Pawar, Minister forAgriculture and Food Processing Industries.Excerpts from an interview:

You�ve just returned from the Philippines. Tellus a little about the situation there; post-Haiyan,as well as the progress made by World FoodProgramme�s rescue and rehabilitation efforts?

It�s now almost two weeks since the typhoonin the Philippines. The emergency relief operationin the early days after the dramatic anddevastating typhoon hit was very challenging.After the typhoon, WFP had only managed toreach 50,000 people. The devastation was suchthat the roads were not open, you couldn�t getboats into the docks, and so we couldn�t reachpeople. But as of yesterday, we have dispatchedfood to more than 2.5 million people in the areas

that are affected, together with our partners.That�s the difference between where we were andwhere we are now.

Flying over Tacloban recently, I saw housesthat were completely destroyed, and visitedevacuation centres with more than 2000 families,but I also saw the roads cleared, people goingback to houses and beginning reconstruction. ThePhilippines people are marching forward, andWFP is moving with them. We recognise that thisis going to be a long road back and investmentand effort is what is required. This is going to bea very complex operation, where you need cashfor work and food for work programmes thatyou can give to people to support their food needswhile they rebuild their house and livelihood.

In your opinion how does the world view therecently passed National Food Security Act byIndia?

The reality is that we as a global communityrecognise that we have the tools and theknowledge to eliminate hunger and foodinsecurity. The passage of the bill signals that theIndian government has the public will. It�s thiswill that we are too often missing. You cannotcreate sustainable, durable solutions to food andsecurity without government leadership. That iswhat we have now in India. As a number ofministers have reminded me, most of theprogrammes on the bill are not new, but all of

* Interview with World Food Programme�s Executive Director Ertharin Cousin

In view of the National Food Security Act, World FoodProgramme�s Executive Director Ertharin Cousin discusses the

organisation�s plans to assist India�s fight against hunger


these have been taken and put under oneumbrella. They�ve been prioritised and it is thatprioritisation and their focus on the issue thatwill make the change.

How do you compare and contrast the Indiansituation to that in other parts of the worldsuffering from food insecurity and hunger?

I think there are a couple of contrasts. Theprimary contrast is the size of the country andwhile India has reduced the number of vulnerablepoor people in the country in the past ten years,that percentage is still in whole numbers largerthan entire countries. This size is a significantfactor and challenge in India�s goal of achievingfood security and elimination of hunger. Thesimilarity is the efficiency and effectiveness that�srequired in a public distribution system toeliminate leakages and duplications. We�ve seenthose challenges in other places. We know thekinds of technology solutions that we can bringinto India to assist in implementing programs thatare much more effective and efficient and fit thetarget audience.

And a little bit about WFP�s plans in India, withregards to policy making and implementation?

The best practice model that we developed forTargeted Public Distribution System reformbecomes one tool that we can use. We are alreadysupporting its scale up in Odisha. We can meetwith other state governments and provide thatas an option. We have talked to the ministryabout potentially using an ICT (Information andcommunications technology) e-commerce tool asa pilot programme that we can introduce indifferent states. Like any pilot, we will measuregoing in, implement, measure coming out andthen write about outcomes and put the

programme into practice in other states. Thereality of what WFP can do is identify tools thathave worked abroad as well as tools that haveworked in India and pilot them in very diverselocations across the country.

I wouldn�t call it handholding because this isa very sophisticated government in India. Thereare some contexts that you work in and you haveto bring a level of technological and intellectualcapacity. That�s already in place in India. WhatIndia needs is help in implementation; in learningfrom best practices from within and outside ofthe country. WFP is the operational agency inthe UN and what we have built our reputationupon is our ability to perform. Bringing thatexpertise to the implementation of policies iswhere we see the opportunity to assist.

During this visit you have had several interactionswith ministers and representatives of variousorganisations. Have there been any concretetakeaways?

There have been a number of concretetakeaways. Professor Swaminathan hosted around table discussion with eight differentministries where each of the ministers andsecretaries presented opportunities where theycould use WFP�s assistance and the good partabout that was that the World Bank was thereand the representatives from UNDP as well asUNICEF were there. I don�t want to identify anyparticular one but I can tell you that we are nowdeveloping a menu of opportunities for us to pilotprojects and we will, over the coming weeks,work particularly with the Ministry ofAgriculture and the Minister of Food to identifyfrom that menu the key priority projects that theywant us to focus on and we will create aprogramme plan on how to move forward.


28Ambitious Agenda for Food Security

Sandeep Kandicuppa*

HIMAL South Asian, November 27, 2013

The 2013 Food Security Act is far-reaching inaddressing hunger and malnutrition but

comes up short in key areas due to the broaderpolicymaking context.

The National Food Security Act is one of themost prominent pieces of legislation passed bythe Indian Parliament in recent times. The passageof the Act is the culmination of a long processthat started with the case filed by the People�sUnion for Civil Liberties (PUCL) in April 2001,which pointed out the general need to recognisethe right to food as flowing from the right to lifeenshrined in the Indian Constitution.Notwithstanding the numerous valid criticismsthat have been levelled against the Act, it is animportant piece of legislation directed against thetwin curses of hunger and malnutrition that stillplague India. But before weighing the merits, itis worth asking why the Act is actually needed atall? And, what is different about this newlegislation?

Hunger and malnutrition statistics in Indialeave little doubt about the need for drasticmeasures. In the 2013 Global Hunger Index,India is ranked 63rd out of 78 countries. TheHunger and Malnutrition (HUNGaMA) Report2012 that covered 112 districts across some ofthe poorest states in the country estimated that42 percent of the children below five years ofage were moderately or severely underweight.The India State Hunger Index rated 14 states in2008, and placed 12 in the �Alarming� category

and one in the �Very Alarming� category. India isalso home to an overwhelming number ofunderweight and stunted children and anaemicwomen according to the National Family HealthSurvey-III. All these statistics point to the needfor strong measures to combat hunger andmalnutrition.

Significantly, the Act recognises food as alegal entitlement of the people; and in cases wherepeople are unable to realise this entitlement, itprovides redress mechanisms at different levels,in the form of District Grievance RedressalOffices and State Food Commissions. Markinganother first, the Act brings myriad governmentprogrammes, such as the Public DistributionSystem (PDS) that comes under the Ministry ofFood and Civil Supplies, the Mid-Day Mealprogramme vested with the Ministry ofEducation, and the Integrated Child DevelopmentServices (ICDS) administered by the Ministry ofWomen and Child Development, under oneumbrella, governed by a single piece of legislationand subject to a common redress mechanism.

Further analysis reveals several laudableprovisions in the Act. Section 1(5) includes milletsin the definition of food grains. Millets, referredto as coarse cereals in official parlance, arenutritionally superior to rice and wheat in termsof proteins, minerals, fibre and micro-nutrients;and if supplied properly as per the Act, they havethe potential to make a serious dent on ruralmalnutrition. The introduction of millets in

* Programme Coordinator, Deccan Development Society, Andhra Pradesh


government food programmes would also comeas a boost to millet farmers; if assuredprocurement, the necessary infrastructure forstorage and distribution, and a beneficialminimum support price, there is a stronglikelihood that more farmers would be willingto take up millet farming.

Another salutary feature of the Act is that itincludes provisions for enhancing food andnutritional availability to specific populationsegments. Sections 4, 5 and 6 talk aboutproviding nutrition to pregnant and lactatingwomen, children and malnourished children,respectively. Pregnant and lactating women areprovided with meals free of charge duringpregnancy and six months after the child birth.They are additionally entitled to a maternitybenefit of at least INR 6000 (likely during theentire course of pregnancy, although this is notclarified in the Act). In the case of children,appropriate cooked meals will be suppliedthrough Anganwadi (rural health) centres orthrough the Mid-Day Meal programme, free ofcharge, every day except during school holidays.

In the same vein, children with malnutritionare to be identified by the Anganwadi centres andprovided with free meals until they attain thenutritional standards mentioned in Schedule IIof the Act. All these are a step forward inaddressing issues like child malnutrition andmaternal mortality and morbidity by targetingespecially vulnerable population groups.

Reforming the PDS is an important aspect ofthe Act. Section 12(2)(g) calls for supporting localpublic distribution models and grain banks. Ifadequately grounded, this could help indecentralising food distribution in India. Anotherimportant reform suggested is the diversificationof commodities. Exactly what this entails is notmentioned; presumably it will include foodproducts other than just cereals and sugar, suchas pulses and oilseeds. Again, if implemented, thiswould be a significant step in enabling the poorto access a balanced diet and would also helpfarmers growing these crops get a decent pricefor their produce.

The Act talks about inviting local institutionslike Panchayati Raj organisations, self-helpgroups and women�s federations to come forwardand take charge of fair price shops. This is a

departure from the current situation whereentrepreneurs are asked to bid for the right torun a fair price shop, and has the potential toinfuse the operations of these shops with greatertransparency and accountability.

The creation of storage facilities at the districtand block levels is another crucial provision. Thiswould help in reducing the �food miles� or thedistance between farm gates and consumers�plates, and could potentially lead to a reductionin losses due to spoilage and pilfering. However,checks have to be put in place to ensure that thecreation of storage facilities does not become yetanother avenue for private contractors to stepin. These storage facilities should ideally becreated in close consultation with the membersof rural communities, and the management ofthese storage facilities should be vested with thesecommunities.

Manufactured debatesIn light of the provisions mentioned above,

the Act is a welcome move in the fight againsthunger and malnutrition. However, there aresevere shortcomings imposed by the larger policyenvironment, and these shortcomings offset, toa great extent, its many positives. The legislationshould be critiqued against the backdrop ofbroader economic processes that have crippledIndian agriculture, which needs to serve as theunderpinning of any Food Security Act in India.However, before going into these criticisms, itmust be pointed out that the discussions on theAct in the mainstream media, for the most part,have been in poor taste.

Two arguments against the legislation thatsurfaced in the run up to and in the aftermath ofits passage were that (1) the National FoodSecurity Act would place a lot of strain on thenational exchequer and might widen the currentaccount deficit (CAD) and (2) that the availabilityof cheap food under the Act would make the poorlazy. Both of these arguments are flawed and needto be countered. First, regarding the Act�sfinancial unviability, it is estimated that the Actwould cost the national exchequer about INR125,000 crores.

However, the food subsidy stands at aboutINR 90,000 crores at present, and these food


subsidies would be brought within the ambit ofthe Act. This implies an additional allocation ofonly INR 35,000 crores. With a total GrossDomestic Product of INR 55 trillion in 2012-13(at 2004-05 constant prices, as per Ministry ofFinance), if India cannot spare a mere two percentof total GDP for some of the poorest and mostmalnourished people on the planet, there issomething fundamentally wrong with itspriorities.

The second criticism, and one that featuredin many popular TV debates by well-known freemarket proponents, is that the Act will make thepoor lazy. However, these spokespersons of thefree market conveniently ignore the huge dolesto the rich in the form of tax holidays andexemptions. As per the data from the Ministryof Finance, in 2011-12, the revenue forgone bythe government of India stood at a staggeringINR 500,000 crores. The items that fall underthe category of revenue forgone include customsduty, direct corporate tax, and export promotionconcessions to name a few. These items largelyimpact the top quartile of the Indian population.

If this largesse has not made the rich lazy, thereis no reason to think that a Food Security Actshould make the poor of India lazy. Such anargument only reflects the fact that a certainsegment of the Indian populace has becomecompletely insulated from the harsh realitiesfaced by the poor. In a country like India, withits high incidence of poverty and where the gulfbetween the rich and the poor is rapidly widening,the State should strive to enhance peoples�capabilities by enabling them to access affordableand nutritious food.

Limits of legislationAside from these shallow arguments, other

critiques of the Act are worth taking seriously.The first is that the Act stops short of makingfood a fundamental right. Doing so would havemade it constitutionally obligatory for thegovernment to ensure that everybody in India hasaccess to nutritious food. Unfortunately the Actavoids even mentioning the phrase �right to food�.Therefore, while during the debates surroundingthe legislation the government made it appearthat the Act promotes the right to food, in reality

it is another example of the welfare-orientedapproach that the Indian State has adopted overthe decades, particularly with respect to foodsecurity and issues of rural poverty.

To elucidate this further, the legislation onlytalks about providing a certain quantity of foodto the poor and creates a redress mechanism incase the State fails to deliver on its promise. Butthe Act does not even talk about the need tocreate an enabling environment wherein the poor,especially the rural poor, can enhance their owncapacities to produce food or to access food thatis locally produced. The legislation does not gobeyond the conventional understanding of foodsecurity, wherein the State provides the food thatit deems fit for the poor, or consider decentralisedagricultural and food systems that allow peoplegreater decision-making about what they are ableto eat, what crops to grow and how to growthem.

At a deeper level, the Act is detached fromthe realities confronting Indian agriculture. Thelegislation includes coarse cereals in the definitionof food grains, thus paving the way for theprocurement of these important food grains.However, no thought has been spared on howthe cultivation of these cereals will be encouraged,what steps will be taken to bring farmers backto these crops, and what model of farming willbe followed in order to revive them.

Ministry of Agriculture data for 2011-12shows a 40 percent decline in the area undermillet cultivation, since the 1960s. There areseveral reasons for the stagnation or decline inthe crops that were, for generations, the bulwarkof dry land agriculture in India. The GreenRevolution, which made India self-sufficient withrespect to cereals, focused mainly on two crops,rice and wheat. These crops attracted a host ofincentives, including a strong minimum supportprice, regular bonuses for farmers, subsidies forfertilisers and pesticides and an assuredprocurement by the State, all of which wereabsent in the case of millets and pulses.

Even in the dry land regions, the push has beentoward paddy and wheat cultivation. The GreenRevolution technologies that worked well initiallywere grounded in rainfed and irrigated pocketslike Punjab and Haryana. Pursuing them in dry


land areas has had severe ecological effects andhas made food cultivation more expensive.

As a result, millets, which were thepredominant crops in the dry land areas havebecome marginalised and replaced by rice, wheatand maize and also by commercial crops likesoybean, sugarcane and cotton. These crops arewater-intensive and demand a high use ofchemical inputs. This shift in cropping patternshas had severe ecological implications, includingthe depletion of groundwater resources and thepollution of soils and water bodies due toexcessive use of chemical inputs.

Also, it has made farmers increasinglydependent on markets for all their agriculturalinputs and has resulted in an unprecedented risein the costs of cultivation. The need for instantcash with which to meet the growing costs ofliving � especially with respect to health,education, debt servicing, etc. � is pushing manyfarmers to adopt input-intensive agriculture andgive up millet-based farming systems, which donot generate as much cash as the former. TheAct is being introduced in this complex milieu.

The next critique flows from theaforementioned point; agriculture is one of theleast remunerative occupations in India today.Analysts like P Sainath, Utsa Patnaik and othershave pointed out that farmers are finding itextremely difficult to carry on with agriculture.The last large-scale survey that looked at theincome of farming households was the NationalSample Survey 59th Round conducted in 2003.

This survey indicates that the average annualincome of the farmers in India stood at aboutINR 25,000, or a little over INR 2000 per month,and the monthly per capita expenditure offarming households was a paltry INR 503, mostof which went towards meeting food expenses,leaving very little for savings. An assessment byT N Prakash Kammardi in The Hindu BusinessLine indicates the dismal state of farmers in thestate of Karnataka. Looking at 2009-10 data on19 principal crops, Kammardi finds that 14 didnot result in any surplus. Barring red gram andsome cash crops, all the other crops resulted in anet loss for the farmer.

Furthermore, except for a few cash crops, theminimum support price extended to the variouscrops did not even cover the cost of production.

While the analysis focused on Karnataka, it is areflection of the situation confronted by farmersin the rest of the country. Thus, as Vijay Jawandiaof Shetkari Sanghatana put it during a meeting,�We are concerned about food security withoutreally looking into food producers� security.�

It is only the farmer who is not assured of aminimum income. As P Sainath says, the peoplewho produce our food are less and less in aposition to afford it for themselves and theirfamilies. This, coupled with the indebtedness offarming households in India, is the cornerstoneof the farm crisis that has come to grip the Indiancountryside, a crisis manifested in the more than250,000 farmers� suicides across India since1995. This is a major bottleneck for the Act. Howcan this kind of legislation succeed if the peoplewho produce food are in the throes of a crisisand their livelihoods are not secure?

Unless measures are taken to improve incomesof farming households and incentivise productionof food grains, especially dry land crops likemillets, pulses, oilseeds and dry land paddy, theFood Security Act will not stop the process offarmers being pushed out of agriculture. Such ascenario can only benefit agri-businesscorporations, which are looking to establish agreater foothold in India�s food production.

The next shortcoming is that the Act laysdown uniform nutritional standards for childrenand pregnant women across the country, anddoes not account for the fact that differentregions might have different nutritional demands;those living in hilly regions, desert, undulatingterrain and so on might require higher nutritionalintake. A more nuanced specification of thenutritional requirements is needed.

While food rights activists and some politicalparties among the Left have been demanding theuniversalisation of the PDS, the Act proposes adifferent type of targeting. It talks of priority andeligible households, amounting to 67 percent ofthe total population of India. While the centralgovernment will determine the extent of supportprovided to each of the states, it is for the statesto identify the households that would fall underthe Antyodaya (�poorest of the poor�) categoryand those who fall under the priority category.This means that effectively, there can be as manyways of identifying the priority households as the


number of states in India, which will onlycomplicate an already controversial mechanismfor identifying the poor.

Additionally, the Act does not talk aboutfixing the logistical problems in the distributionof food. In 2011, Food Minister K V Thomasstated that nearly 100,000 tonnes of food grainswere lost to spoilage for the year. Yet, the needto fix the supply and storage problems of PDS isnot mentioned. A key problem with the PDS isthe inability to reach out to villages in the lastmile. While the Act talks about working towardslocal distribution systems, the idea is not fleshedout. The challenge lies in realising this provisionon the ground. Until that happens, the logisticalchallenges that have plagued the governmentfood programmes will remain.

Two specific provisions in the Act are causefor serious concern. The first deals with providingwheat flour in case cereals are not available. Withthe kind of cereal production that India hasclocked over the last four decades, the questionof availability is frankly redundant. It is only amatter of having the will to procure and channelthe grains into PDS.

The other disconcerting aspect is the talk ofmoving towards cash transfer. Doing so wouldabsolve the Indian state of the responsibility forproviding food to the poor and supporting foodcultivation by extending the various incentivesthat have been discussed above. This move worksin the favour of agri-food companies that wouldsell food to the needy and supply seeds and otheragri-inputs to the farmers producing food.

Dominant decision-makersThe fact is that today, the larger policy

environment is stacked against the �rural� and the�agricultural� and in favour of the �urban� andthe �industrial�. One of the biggest factors behindthe challenges facing Indian agriculture today isthe highly centralised nature of agriculturalpolicymaking in India. What crops should besupported by the government and to what extentis decided by the various departments ofagriculture at the state level or the Ministry ofAgriculture at the central level.

These decisions are made with very little inputfrom farmers themselves. Extending special

incentives to farmers for various crops,distributing free seeds, and providing free inputand seed kits under various programmes are alldecisions made by the agricultural departmentsin various states; these incentives play a majorrole in determining the crops that farmers arelikely to veer towards in a given year.

The other layer of decision-making occurs faraway in the conference rooms of internationalagencies like the World Trade Organisation(WTO). In 1995, India signed the WTOAgreement, and subsequently, dismantled theQuantitative Restrictions that governed theimport and export of agricultural produce. Theyears since have seen greater liberalisation oftrade in agricultural produce. Consequently,cropping patterns are determined by what globalmarkets want and not what local communitiesneed. A case in point is the crisis faced by coffeefarmers in India. Volatility in the global coffeemarket, for example due to frost or worker strikesin Brazil, has led to booms followed by busts thathave adversely affected coffee growers in Kerala.

Not surprisingly, this situation has contributedto a spate of farmer suicides. Another example isthat the minimum support price offered to Indianfarmers has to meet the approval of the WTO,as must the Food Security Act, which currentlyviolates certain commitments to the internationaltrade body. Thus, notwithstanding the alarminghunger and malnutrition statistics of India andthe numerous strictures passed by the apex court,India cannot provide for some of the poorestpeople on the planet without the approval of theWTO. This is an insidious and yet invisible formof centralisation.

Proposed legislation like the BiotechnologyRegulatory Authority of India (BRAI) Bill andThe Seed Bill suggest, in the coming years, acontinuation of policymaking along theaforementioned lines. These bills are heavilyloaded in favour of agri-tech industry and relegatelocal communities to advisory positions. Theyvest real decision-making power with governmentbodies and corporate houses, and propose tocreate centralised structures that would decidewhether a given technology is safe or not, whatkind of seeds would be released into the market,and how much information would be madeavailable in the public domain. While such


legislation is couched in mostly conciliatory toneswhen it comes to farmers, they only serve toundermine the interests of the farmers. This isone of the reasons why the Food Security Actmay be an exercise in tokenism.

A related point is the growing connectionsbetween the government and private enterprises.Various programmes of the government whichentail the distribution of seeds, pesticides,fertilisers and so on, involve procuring hugequantities of agri-inputs from private enterprise.A handful of companies like Monsanto, Cargill,and Bayer to name a few exercise significant

control of global agri-business and have stakesin all aspects of agriculture through a dizzyingseries of cross-holdings. With India eagerlyembracing these companies, chances are that theinterests of Indian farmers will be sacrificed uponthe altar of �development� and �technologyupgradation�. This is the larger reality withinwhich the Food Security Act is situated. If theneeds of farmers are not given precedence overand above private, commercial interests, Indiawill have squandered a golden opportunity to usethe Food Security Act to address serious problemsfacing those who produce our food.


29India not to Compromise on

Food Security: SharmaThe Hindu, December 02, 2013

On the eve of WTO ministerial meeting here,India said the interim solution on food

security as currently designed is not acceptableand the country won�t compromise its farmers�interest or succumb to mercantilist ambitions ofrich nations.

There is a national consensus and completepolitical unanimity on this matter in India,Commerce and Industry Minister Anand Sharmasaid, adding: �It is therefore difficult for us toaccept an interim solution as it has been currentlydesigned.

�We can no longer allow the interests of ourfarmers to be compromised at the altar ofmercantilist ambitions of the rich. The BaliMinisterial Meeting is an opportunity for thedeveloping countries to stay united in resolve todemonstrate the centrality of agriculture in tradetalks.�

Developed countries have proposed an interimsolution of four-year �peace clause� during whichperiod India would not attract penalty even ifthe 10 percent cap is broken.

As per the existing Agreement on Agriculture(AoA) of the Geneva-headquartered WTO, farmsubsidy has to be capped at 10 percent of thetotal value of the farm production. India hasraised issues regarding the way the cap value isbenchmarked to the base price.

In a statement at a meeting of the G-33 inBali on the eve of the 9th Ministerial Conferenceof the World Trade Organization, Sharma saidthat for decades, �handful of farm lobbies ofsome countries� have shaped the discourse anddetermined the destiny of millions of subsistencefarmers of the developing countries.

�The massive subsidisation of the farm sectorin the developed countries is not even a subjectmatter of discussion, leave aside seriousnegotiations,� he said.

He further said that food security must beprotected from all challenges in the WTO as it isnot only a sensitive issue for India but also acritical social imperative.


30India has its Way at WTO on Food Plan

Siddhartha*

The Times of India, December 07, 2013

The government claimed major gains atthe World Trade Organisation as members

accepted its demand on food security that willprotect India and other developing countries frompenalties for breaching the domestic subsidy capof 10 percent of value of production. In return,India agreed to a new agreement on tradefacilitation, the first since WTO was set up nearlytwo decades ago, that will ease controls at portsand airports and may provide a boost of up to$1 trillion to the global economy.

�It�s a great day because. It�s a historicdecision. It�s a victory not only for India but forall developing countries. It�s a victory for WTOand all countries who have come to a maturedecision,� said an elated commerce & industryminister Anand Sharma while coming out of ameeting where the decision was circulated toWTO�s 159 members.

Politically, the Congress party will claim amajor victory as it will help it roll out the UPA�sflagship National Food Security Act without anyhurdles. In addition, it will help blunt anyopposition from principal opposition BJP and theLeft parties.

But the result was not easy as India shruggedoff pressure and stuck to its demand. Tradeministers spent the last four days trying to bridgedifferences over a trade deal that has remainedelusive for years. The Bali package, as it is beingcalled, is the first success in the Doha Round ofnegotiations that started 12 years ago with a viewto help developing and poor countries. For India,

the victory was particularly sweet as it managedto have its way despite major players China andBrazil backing out, leaving South Africa as theonly major ally along with Argentina and somelarge African countries such as Kenya andNigeria.

While members have virtually accepted thedraft circulated by WTO, an endorsement is seenas a formality.

As demanded by India, developing countrieswill now be able to continue with their publicprocurement programmes without fearing apossible breach in the ceiling. A ruling in itsfavour will help the government roll out the foodsecurity law without any hurdles as procurementhiccups could have impacted the implementationof UPA�s flagship scheme.

Although India has still not exceeded the 10percent limit, higher minimum support price andincreased quantities of purchases are pushing upthe domestic subsidy level as 1986-88 prices areused to calculate the level of support.

Civil society groups, however, pointed out thatdeveloping countries can still be dragged to WTOseeking penalties for violation of rules onsubsidies. The government, however, refuted thecharges. Countering their other charge, Sharmalater told reporters that there are no restrictionson launching new food security schemes.

To get the food subsidy benefits, thegovernment will have to comply with conditionssuch as the support offered by it and if it is

* Journalist, The Times of India


nearing the 10 percent limit. In addition, thebenefit will be available for all crops.

There were other gains for the developingcountries such as Brazil, China and India morecompetitive in international markets. The leastdeveloped countries too got a package of sorts.

The trade facilitation agreement will, however,require changes in Indian laws, especially theCustoms Act, a quicker transition to electronicpayments across ports and a special set of rulesto speed up courier flow at airports.


31Application Process for

Food Security Card ResumesVishal Kant*

The Hindu, December 21, 2013

The Delhi Government�s Department of Foodand Supplies has resumed the process of

issuing food security cards to beneficiaries underthe National Food Security Act, 2013.

The process of issuing smart cards tobeneficiaries of the scheme, which wasimplemented from September 1, was stoppedafter the model code of conduct came into forcefor the Assembly elections.

The department issued a public notice askingration card-holders to apply for new cards byJanuary 10.

�Ration card-holders who are presentlygetting ration and who have still not applied forthe new ration card under the National FoodSecurity Act, 2013 have been requested to applyfor it by January 10. The scrutiny of all suchapplications would be done in order to weed outfake ration card-holders. Smart cards would beissued to them gradually,� said the department�sSecretary-cum-Commissioner, S.S. Yadav.

A total of over 5 lakh families (around 32 lakhpeople) in the Capital currently hold ration cardsunder different schemes like Below Poverty Line,Antyodaya Anna Yojna as well as ration cardholders living in slumand resettlement colonies.

All families holding ration cards are entitledfor subsidised food grains at the rate of 5 kg per

member per month. While around 72 lakh peoplewould ultimately be covered under the schemein Delhi, the authorities have started the processof issuing new ration cards to the existingbeneficiaries.

Officials said the renewal of the cards wouldalso help in weeding out fake ration card-holders.

�We have already received applications fromaround 16 lakh households. Data entry of thereceived forms has been completed and electronicscrutiny of the applications has also begun. Theapplications are being collated with the datacollected from other departments like transport,income tax, property details from MCD andpower usage pattern from discoms. The next stepwould be field verification of the applicants,which is likely to begin,� said Mr. Yadav.

Officials said the department is likely to startdistributing the first set of smart cards byDecember-end.

�We had issued tenders for manufacturing thesmart cards. We have already received bids forit. We will finalise the vendor within a week,�said Mr. Yadav. Officials said all beneficiarieswould be identified and covered under the schemewithin the stipulated deadline of July 5, 2014.

* Senior Reporter, Deccan Herald, New Delhi


32Food Security Act: Should Centre

Emulate Chhattisgarh? � YESReetika Khera*

The Hindu, December 28, 2013

A year after the Centre tabled a National FoodSecurity Bill, on December 21, the

Chhattisgarh Government enacted theChhattisgarh Food Security Act (CFSA) which,in some ways, is better than the Centre�s Bill.

The CFSA covers the public distributionsystem, school meals, anganwadis (includingtake-home rations for pregnant/lactating womenand children under three) and free meals for thedestitute and homeless. It excludes 10 percent ofhouseholds from the PDS.

The rest are divided into three groups:Antyodaya, Priority and General. Unlike theCentral Bill, the size of these groups has not beencapped artificially.

Antyodaya and priority households get 35 kgof grain at Rs 1-2/kg. Taking a cue from Statessuch as Tamil Nadu, Andhra and HimachalPradesh, the CFSA guarantees 2 kg of pulses atRs 5-10/kg, an essential source of protein.

Notable features of the CFSA include: One,sensible use of technology (for example, fullcomputerisation of PDS); two, greatertransparency (public scrutiny of all records) andthree, strengthening accountability (publicinstitutions such as Gram Panchayats havepriority in running ration outlets).

These reforms, in place since 2004 inChhattisgarh, have yielded good results:Estimated diversion of PDS grain fell from halfin 2004-05 to 10 percent in 2009-10.

The CFSA comes at a time when the Centreappears on the verge of reneging on its promiseof a National Food Security Act in favour of cashtransfers. Doublespeak and confusion on theissue abound: While the Food Minister stated inParliament that the failed Kotkasim kerosenecash transfer model will be applied to food in sixUnion Territories and Puducherry, other seniorCongress leaders continue to deny this.

The benefits of computerisation (enhancedadministrative capacity, better accounting) andbanking (protection from corruption) are beingmarketed as the �magic� of aadhar. Animpression is being created, perhapsunintentionally, that aadhar will create eligibilityfor welfare benefits.

In fact, today, aadhar is neither necessary norsufficient for any government benefits. FromJanuary, it will become necessary for somebenefits, without being sufficient. Setting asidepolitical considerations, there is a strong case forsuch an Act: Economic and food security.

In Tamil Nadu, 60 percent of the �povertygap� has been wiped out due to implicit transfersthrough the PDS; the figure for Chhattisgarh is40 percent and nearly 20 percent at the all-Indialevel.

The case against cash-for-food is equallystrong: Poorly developed banking infrastructureand markets in rural areas, inflationary pressuresand so on. The Chhattisgarh Government hasother faults, but this is one lesson to learn from it.

* Assistant Professor, Humanities & Social Sciences, IIT, Delhi and a fellow at the Institute of Economic Growth,Delhi


33India�s Plan to Feed 800 Million People

is Either Amazing or InsaneKrista Mahr*

Time World, January 13, 2014

For decades, the Indian government has beendistributing subsidised food to millions of

poor. But last September, New Delhi went asignificant step further: Parliament passed theNational Food Security Act (NFSA), guaranteeingaccess to subsidized food to nearly 70 percent ofthe 1.2 billion population. In an unprecedentedexperiment, the central government is now legallybound to provide each of over 800 million people� just shy of the combined populations of the USand the European Union � 5 kg of subsidised foodgrains every month. (The poorest receive more,and states also run their own food-subsidyprogrammes.)

For these people, food is now a right, not aluxury, and it�s up to officials to make sure theyget it. The program, if successful, could give amajor boost to the ruling Congress Party aheadof national elections this spring. The problem,critics say, is that the landmark legislation relieson an unwieldy network of farmers, buyers,storage facilities and sellers to provide some 60million tons of subsidised grains each year.

In many ways, the system works: accordingto a recent study, in fiscal 2011�12, over 500million Indians received 51.3 million tons ofsubsidised food, or more than 10 times theamount of direct food aid delivered by the WorldFood Programme in 2011. But in 2005 thegovernment estimated that nearly 60 percent ofits grain did not reach beneficiaries because of

theft, corruption and difficulties identifying theneedy. More recent studies show that hasimproved somewhat, but over 17 percent ofIndians are still undernourished, according to the2013 Global Hunger Index.

Few would argue against getting food to moreIndians. But not all agree the NFSA is the way todo it. The law is expected to cost the governmentabout $20 billion in fiscal 2013�14 as it rolls outacross India. That�s a moderate increase overwhat the government has already been spendingon food programmes, and its supporters say it isnothing short of a moral obligation of thegovernment to its citizens. �The question is notwhether we can do it or not,� Sonia Gandhi,leader of India�s ruling Congress Party, said in arare public speech to lawmakers before the bill�spassage. �We have to do it.�

But critics say that more spending on welfareprogrammes � especially when that spendingrelies on a flawed system � is reckless in aneconomy burdened by a weakened currency anda large fiscal deficit. Says Ashok Gulati, chairmanof India�s Commission for Agricultural Costs andPrices: �The economic inefficiencies and thelosses incurred [in the system] will outweigh thewelfare gains you are trying to achieve.�

Can India�s ambitious scheme work? Read thefull story here, and read Michael Schuman�sviewpoint on the law here.

* TIME�s South Asia Bureau Chief and Correspondent in New Delhi, India

The jury is still out on this one


34Prez Bats for New Tech in Farming

The Times of India, January 20, 2014

President Pranab Mukherjee said the futurelay in technology-driven agricultural growth.

He called upon the network of agriculturalresearch, education and extension institutions todevelop and implement newer technologies formore farm development.

He was speaking in Baramati afterinaugurating a new Krishi Vigyan Kendra (KVK)building and a technology exhibition. Unionagriculture minister Sharad Pawar, chief ministerPrithviraj Chavan, and deputy chief minister AjitPawar were present.

�The National Food Security Act, 2013provides legal guarantee for food grain ataffordable prices to more than 800 millionpeople. The rollout and successfulimplementation of the world�s largest socialsector programme will depend on the success ofour agriculture sector,� he said.

The Science, Technology and InnovationPolicy, 2013 has laid down the importance offostering innovations in agriculture. The policyhas also envisaged a greater mentoring role forgrassroot institutions like KVKs. The KVKs haveto train growers and encourage them to formassociations for collective bargaining in procuringinputs and selling their produce, he added.

The country, the President said, ranks first inmilk and second in fish production in the world.Given the demand for both, a focused strategy isrequired to leverage their production potential.Technology-led growth in horticulture, livestock,dairy, and fisheries sectors would usher in arainbow revolution in agriculture, he added.

Chavan said farmers must adopt newtechnology and KVKs would play big role indisseminating information.

The President also inaugurated the conferenceof vice-chancellors of agricultural universities anddirectors of the Indian Council of AgricultureResearch (ICAR) institutes. He said agriculturaluniversities should adopt and promote the latesttechnologies among farmers within the countryand abroad.

Pawar says he wanted agriculture ministryUnion agriculture minister Sharad Pawar, in

his speech, recalled how he preferred theagriculture ministry in UPA-I government in2004. Pawar said, �The President may recollectthat in 2004, when we took the decision to formUPA-I under the leadership of Manmohan Singh,

I recollect you came to my house and askedabout my preference about the portfolio. Iimmediately replied that my interest is inagriculture. The President was the financeminister then and said he was surprised becausehe thought that I would ask for the defence, homeministry or some other portfolio.�

Mukherjee appreciated Pawar�s efforts in theagriculture ministry in the last 10 years. He said,�I was a bit surprised, because he had been thechief minister and was also the defence minister.I expected that he will give preference to homeministry, if not defence. But thanks to him andhis choice of ministry, the country can rejoicethat his policies are firmly established inagriculture.�

The National Food Security Act, 2013provides legal guarantee for food grain ataffordable prices to more than 800 millionpeople. The rollout and successfulimplementation of the world�s largest socialsector programme will depend on the success ofour agriculture sector.


35Sustainability and Food Security

Nilanjan Ghosh*

The Hindu Business Line, January 20, 2014

The South Asian population has been growingat the rate of 1.5 percent per annum, and

agricultural production at 2.5 percent per annumhas been keeping pace with the demographictrends, thereby creating the necessary provisionfor food. Yet, the inherent problems ofdistribution have loomed large for South Asia.

India�s National Food Security Act, 2013,emphasises defining certain target groups andhighlights the importance of distribution.Agricultural policies in South Asia, including thatof India, have always been vocal aboutproduction, marketing, pricing and, to an extent,about natural resource use, and the use ofagricultural inputs.

Food-ecosystem linkageHowever, in policy implementation, the

inextricable linkage between ecosystems and foodis often ignored. There is practically norecognition of the fact that, of the entire rangeof services provided by the ecosystem, foodprovisioning � either by natural operation orthrough human intervention � holds utmostimportance.

Critical ecosystem services facilitateagricultural production, create income-generating opportunities, and provide energy forcooking.

The production aspect of food is explainedby the fundamental dependence of agriculturalsystems on ecological processes. On the otherhand, household-level access to income isfacilitated by the production of agricultural goodsand raw materials that can be sold. From theutilisation perspective, ecosystem services createprovision of safe drinking water and food;provide fuels and energy for hygienic heating,cooking, and storage of food; the materials forsanitation and health care; and the micronutrientsnecessary for an adequate diet.

Another PerspectiveOften, what is perceived as �damage� from a

myopic economic perspective turns out to be aboon from the social-ecosystemic perspective andvice-versa. The Bihar floodplain in the Gangessub-basin of India is a case in point. Apparentlyperceived as �flood damage�, the floodwater,upon receding, leaves behind rich silt andmicronutrients that have helped in the naturalcreation of the most fertile agricultural land �also known as �rice bowl� of South Asia.

The opposite is also prevalent in the samebasin. Further downstream, the Farakka barrage,constructed in 1975 to resuscitate the Calcuttaport, has been witnessing ecosystem damages dueto stream-flow depletion caused by its natural

* Chief Economist of MCX and Acting President of the Indian Society for Ecological Economics

Policymakers, stuck to an engineering paradigm, do not recognisethe effects of river linking, dams, deforestation and excessive use of

fertiliser on food security.


course. This has, in turn, affected the mangroveforests, fisheries production, fish catch (quantityand quality), and eventually the fishingcommunity.

The traditional engineering paradigm hasconveniently been oblivious of these ecosystems-food-livelihood linkages in the planning process.There are many such examples in South Asia.These ecosystem concerns have hardly featuredeven in the context of the grand plan of riverinterlinking, or while converting forest land foragriculture or other purposes.

Agricultural expansions during the lastcentury have caused widespread changes in landcover, watercourses, and aquifers; therebydegrading the ecosystems and restricting theirability to support some services, including foodprovisioning. Some examples of this are thevarious major river basins such as the Ganges-Brahmaputra-Meghna (GBM) basin, Cauverybasin, Krishna basin, and so on.

Flawed approachThe management policy of many agro-ecosystemshas essentially been based on the premise thatthey are delinked from the broader landscape.Crossing ecological thresholds leads to a regimechange in the ecosystem and its concomitantservices. Apart from reducing the ecosystemresilience, this restricts the sustainability of foodprovisioning.

Threats to the ecological foundation ofagriculture arise from resources that aresupposedly becoming scarce over time. Thedrivers of this process are competition over landand water, traditional resource-consumingagricultural practices, deforestation, andunsustainable pesticide use (that reduces the long-term soil productivity, and also contaminatesgroundwater), and climate change.

The critical knowledge gap here pertains tothe relations between water and food. Foodsecurity has so far been thought of as a positiveand linear function of water availability. Whilemost experiments on the subject in the US andthe EU have refuted the direct proportionalitybetween water and food availability, such aknowledge base is yet to emerge in South Asia.

The US, the country which started the globaltrend of building large dams, begandecommissioning dams that have causedegregious ecological impacts; thereby affectinglivelihoods and the provisioning services of theecosystem. Nearly 500 dams in the US andelsewhere have already been removed, with anaim to restore the ecosystem.

Towards sustainabilityBy 2050, food demand in South Asia is going

to double. There is no doubt that in many cases,bringing land and water resources under the foldof agriculture will not be a viable option. Withecological thresholds being exceeded, foodprovisioning services of the ecosystem are beingseriously affected; thereby, posing a threat to thenature�s capacity to provide food for ruralhouseholds.

South Asian river basins like the GBM presentthe most interesting paradox of the developmenttheory � ample water, ample poverty. As has beenproposed by Jayanta Bandyopadhyay andNilanjan Ghosh in an article in Economic andPolitical Weekly in 2009, the prime reason forthis paradox is a sheer de-recognition of theecosystems-livelihoods linkage.

There is no doubt that increased water andland productivity (and not increased use) has tobe the core of the solution. On the other hand,from a very regional food security perspective,trade in �virtual water� (or agricultural imports)can indeed play a crucial role. For serving thelong-term needs of food security, a more holisticperspective is needed. This will entail anintegrated approach for managing land and waterresources and ecosystems, in order to supportlong-term food production.

There is a need to develop less-resourceintensive practices (for example, system of riceintensification) for producing crops that havetraditionally been high-resource-consuming.Moreover, policy documents need to look atwater and land as an integral part of the globaleco-hydrological cycle, and not as a stock ofmaterial resource to be used for the satisfactionof human requirements.


36Subsidies for Beneficiaries as Karnataka &

Chhattisgarh Implement NFSAFnBnews, January 20, 2014

The implementation of the National FoodSecurity Act, 2013 (NFSA) in Karnataka and

Chhattisgarh took the number of states coveredby it to seven. The other five are Delhi, Haryana,Himachal Pradesh, Punjab and Rajasthan.

The people identified as beneficiaries by thestate governments will get rice, wheat and coarsegrains at Rs 3 per kg, Rs 2 per kg and Re 1 perkg respectively. Each beneficiary will get 5kgfoodgrain per month.

However, the existing entitlement toAntyodaya Anna Yojana (AAY) households (i.e.35kg per household per month) will be protected,as they constitute the poorest of the poor.

The Centre made foodgrain allocations tothese states as per the requirements projected bythem for the implementation of the Act. It isexpected that Uttarakhand and Chandigarh willjoin these shortly.

It also decided to protect the existingallocation to each state in case the allocationunder the proposed legislation is lower than itscurrent allocation. It will be protected upto theaverage offtake level during the last three years,at prices to be determined by the Centre.

The Act entitled pregnant women, lactatingmothers and children between the age of six

months to 14 years would be to meals as per thenutritional norms prescribed under the IntegratedChild Development Services (ICDS) and Mid-DayMeal (MDM) schemes.

Pregnant women and lactating mothers wouldalso be entitled to receive a maternity benefit ofnot less than Rs 6,000. Higher nutritional normshave been prescribed for malnourished childrenupto six years of age.

The Act will also contribute significantly towomen�s empowerment in the country with itsprovision of declaring the eldest woman of thehousehold, aged 18 years or above, the head ofthe household for the purpose of issuing rationcards.

The government notified the National FoodSecurity Act, 2013 on September 10, 2013 tofurther strengthen the efforts to address the foodsecurity of the people.

The Act provided for coverage of upto 75percent of the rural population and upto 50percent of the urban population for receivingsubsidised foodgrains under the Targeted PublicDistribution System (TPDS), thus covering abouttwo-thirds of the population.


37Centre�s Welfare Plans may Strain

Finances of States: RBI StudyThe Economic Times, January 24, 2014

Expressing concern over suchpolicies, the central bank has said

in its report �State Finances: A Studyof Budgets of 2013-14�, released,�Some of the recent policyinitiatives of the central government,like the restructuring of centrally-sponsored schemes and theimplementation of the National FoodSecurity Act 2013 would entailadditional responsibility at the statelevel.�

The continued decline in theoutstanding state government liabilities-GDPratio since 2004-05 continued in 2012-13(revised estimates) and the ratio is projected todecline further in 2013-14.

The key deficit indicators of the consolidatedstate governments relative to GDP are budgetedto improve in 2013-14, with an increase inrevenue surplus contributing to a reduction ingross fiscal deficit. Revenue surplus is budgetedin 22 out of the 28 states in 2013-14.

�The improvement in state finances will belargely due to improvement in primary accountoriginating from stability in salary expendituregrowth,� said Devendra Kumar Pant, chiefeconomist and head of public finance at IndiaRatings. �However, fiscal consolidation is

happening at the cost of capital expenditure bystates,� he added.

This means expenditure on developmentprojects and building assets is being curtailed toachieve fiscal consolidation, affecting long-termgrowth prospects of states. The capital outlay-GDP ratio, which had increased significantly to2.3 percent in 2012-13 from 1.9 percent in thepreceding two years, is budgeted to increasefurther to 2.4 percent in 2013-14.

Capital outlay is expected to constitute 15.2percent of aggregate expenditure in the currentfiscal. The report also expresses concern over thenarrowing of the growth-interest rate differentialwhich could exert pressure in the medium term.

States could bear the brunt of the Centre�s policies such as theNational Food Security Act, a Reserve Bank of India study on the

finances of state governments has indicated.


38The National Food Security Act vis-à-vis

the WTO Agreement on AgricultureSudha Narayanan*

Economic & Political Weekly, February 01, 2014

IntroductionRecent commentaries on the National Food

Security Act (NFSA) and its implications forIndia�s international commitments expressalarmist concern (Sukumar 2013; Correspondent2013, for example).1 This stems from a perceptionthat in implementing the Food Security Act, Indiawould need to initiate distortionary interventionsin domestic foodgrain systems that would breachits international commitments under the WorldTrade Organisation (WTO) Agreement onAgriculture (AoA). A recent visit to India by thedirector general of the WTO and the salvo bythe US ambassador to the WTO aimed at India�sstand on food security has renewed these fears.2

The issue of India�s external commitmentsunder the WTO is indeed a complex terrain,rendered somewhat opaque by legalese on theone hand and by the complicated nature of thenegotiation processes within the WTO on theother. While the government cannot afford toturn a blind eye to its international commitments,the issues at hand are perhaps far less cause forconcern than imagined. This article discusses theimplications of the NFSA for India�s internationalcommitments, focusing on select aspects of theNFSA in the light of India�s relationship with theWTO since the AoA came into force in 1995.The attempt here is to lay out the areas wherethe instruments supporting the NFSA pose noproblem and those where the government would

have to carve out a strategic path to ensure a finebalance between the implementation of the NFSAand its external commitments in the wake of afresh round of trade negotiations. The focus willbe the public distribution system (PDS), whichhas been the cynosure of public discussion.

This article suggests that the support that theNFSA would entail is unlikely to be substantiallylarger relative to current levels. Although overthe past five years, India�s support levels in thecontext of AoA have increased significantlyrelative to the pre-2005 levels, it is still well underthe limits committed by India and within the spanof permissible provisions under the WTO�s AoA.These support levels correspond to a scale ofoperations that one would expect with theimplementation of the NFSA. It seemsunnecessary for India to seek special protectionto enable the implementation of the NFSA andthat negotiating on a few technical andsubstantive details within the existing frameworkwould likely suffice.

Moreover, regardless of the WTO AoA, Indiawould have to revamp and rationalise existingsystems and establish a more nimble, transparentand cost effective food management system. Thisis desirable not only for its own sake, but wouldalso enable India to temper the levels of supportin ways that the committed thresholds are notbreached.

* Assistant Professor at Indira Gandhi Institute of Development Research, Mumbai


The first part discusses very briefly India�sobligations under the WTO�s AoA of 1995 atthe time it came into force. The second examinesin detail the implications of the PDS as envisagedin the NFSA and the third evaluates the wayforward for India.

India and the AoAWhen the AoA came into force in 1995 after

lengthy and contentious negotiations that werewidely perceived to have sidelined all but a fewpowerful countries, it was the first worldwideeffort to address agricultural trade issues. Thegoal was to reduce the high levels ofprotectionism in international agriculture so thatthe benefits from trade would accrue to exportingfarmers, while benefiting poor consumers inimporting countries. The three pillars thatconstituted the AoA comprised market access,domestic support and export subsidies. Marketaccess entailed import liberalisation (throughconversion of all quantitative barriers to tariffsand progressive reduction in these tariffs). In thecontext of domestic support, it was envisaged thatcountries would reduce in certain types ofdomestic support that would have spill-overimpact that could potentially distort trade.

For example, this could entail payments by anational government to its farmers or pricesupport that would keep its farmers in productionin the absence of which they would not haveproduced, thus precluding the possibility ofinternational trade. On the export front, a

reduction of export subsidies and barriers toexports would be addressed.

All interventions pertaining to these threepillars were grouped into amber, green and blueboxes. Green box measures would be exemptfrom reduction commitments; amber would haveprescribed limits reduction commitments whileblue box measures evolved as special category.All domestic support measures considered todistort production and trade (with someexceptions) fall into the amber box. These includemeasures to support prices, or subsidies directlyrelated to production quantities. Any support thatwould normally be in the amber box is placed inthe blue box if the support also requires farmersto limit production. Green box measures do notdistort trade or cause minimal distortion. Theyhave to be government-funded (not by chargingconsumers higher prices) and must not involveprice support.

India�s commitments at that time were minimalon many fronts (Gulati et al 1999; Hoda andGulati 2008, 2013; Gopinath 2008). Indiaexcluded itself from reduction commitments onmarket access citing a balance-of-paymentsexemption. In the area of domestic support, Indiahad in place a price intervention scheme and inputsubsidies both of which came under the purviewof the AoA. However, India had no reductioncommitments, since its product-specific and non-product specific domestic support were both lessthan 10 percent in the base period. As adeveloping country, it was also allowed exemptionfor domestic support and instruments under the

Source: Notifications of India until 2002-03 (G/AG/IND/N/7), and after that from the Annual Report of the FoodCorporation of India (various years) covering the same categories as in the notifications.

Figure 1: Green Box: Public Stockholding (US$mn)


Special and Differential Treatment (often calledthe S&D box) towards developing countries,providing enough flexibility for its prevalent setof agricultural policies.

Further, India had no export subsidies otherthan those in which developing countries hadbeen exempted from reduction commitmentsduring the implementation period (see paragraph4 of Article 9 of AoA). It was only in the area ofmarket access that India committed to tariff-bound rates representing a ceiling on tariffs thatcould potentially be levied. In simple terms, ithas not needed to alter its policies significantlyin all but a few areas on account of the AoA. Itis against this background of commitments (orlack of it) that the NFSA needs to be assessed.

NFSA: Entitlements and ImplicationsThe NFSA was promulgated on 12 September

2013. While it envisages wide-ranging measuresaimed at addressing aspects of food security,entitlements under the PDS have attracted thegreatest attention in the context of India�s WTOcommitments. Under the provisions of the Act,priority households are entitled to 5 kg offoodgrains per person per month, and Antyodayahouseholds to 35 kg per household per month.The combined coverage of priority andAntyodaya households (called �eligiblehouseholds�) shall extend �up to 75 percent ofthe rural population and up to 50 percent of theurban population�. The PDS issue prices wouldbe Rs 3/2/1 per kg for rice/wheat/millets, subjectto revision after three years. To support theseentitlements the government would procure anddistribute foodgrains, estimated at 63 milliontonnes annually, representing around 30 percentof the foodgrain production in the country. It isuseful to focus on the different components ofthe process by which food is delivered fromfarmers to consumers � food production andprocurement, stocking, transport anddistribution, sale to beneficiaries through rationshops.

Stocking and DistributionIn the AoA, all food subsidies and public

stocking of food are regarded as green box

measures and as such exempt from commitments.Specifically, the Agreement determines that publicstockholding for food security purposes areexempt.

Expenditures (or revenue foregone) in relationto the accumulation and holding of stocks ofproducts which form an integral part of a foodsecurity programme identified in nationallegislation. This may include government aidto private storage of products as part of sucha programme (Annex 2, Clause 3).

While allowing countries the latitude toaddress food security, the AoA mandates howeverthat these operations, which include programmesunder which stocks of foodstuffs for food securitypurposes are acquired and released at administeredprices, must be transparent and conducted inaccordance with officially published objectivecriteria or guidelines. Similarly, for domestic foodaid,

Expenditures (or revenue foregone) in relationto the provision of domestic food aid tosections of the population in need. Eligibilityto receive the food aid shall be subject toclearly-defined criteria related to nutritionalobjectives. Such aid shall be in the form ofdirect provision of food to those concernedor the provision of means to allow eligiblerecipients to buy food either at market or atsubsidised prices (Annex 2, Clause 4).

These two provisions quite explicitly provideroom for the sort of food stocking anddistribution programmes that India has had inplace until now and will do so under the NFSA.India has regularly notified the WTO as requiredon the expenditures in these areas (Figure 1). Assuch the main architecture of food delivery systemsunder the NFSA are consonant with the WTOAoA.

Certain caveats however deserve attention.The first pertains to procurement according toestablished targets and the second alludes,somewhat subtly, to the question of coverage.While neither aspect poses serious problemscurrently, these could easily end up in theblindspot of policymakers.


Regarding the former, Annex 2, Clause 3 ofthe AoA states that

The volume and accumulation of such stocksshall correspond to predetermined targetsrelated solely to food security. The process ofstock accumulation and disposal shall befinancially transparent (Annex 2, Clause 3).

In India, procurement of foodgrains servesthree purposes � building up strategic reserves,price support operations and maintainingsupplies for the PDS. As such these arepermissible interventions under the AoA.

The AoA also states�the provision of foodstuffs at subsidisedprices with the objective of meeting foodrequirements of urban and rural poor indeveloping countries on a regular basis atreason- able prices shall be considered to bein conformity with the provisions of thisparagraph (Annex 2, footnotes 5 and 6).

While this clause has left the notion of �foodrequirements� and �urban and rural poor�unspecified, the implications it has for anexpanded reach of the PDS under the NFSA areunclear. This issue is enmeshed in the highlycontentious issue of the poverty line and ofidentifying the poor. Until now, universalentitlements with regard to food have not beena subject of contention in the WTO. Nor is thislikely to pose a significant problem given thatthe better off tend to select out of the PDS.Nevertheless, the government would need to havea clear sense of the actual beneficiaries who doaccess the PDS. Clause 4 of Annex 2 stipulatesthat eligibility to receive food aid shall be subjectto clearly-defined criteria related to nutritionalobjectives. The NFSA merely fixes the overalllimits in terms of the percentage of populationand leaves it to the state governments to definethe criteria. The implications of whether stategovernments would have to define the criteriarelated to nutritional objectives need to beaddressed.

For India, the greater concern lies in theprocurement operations. Even while permittinggreen box measures, the AoA contains clausesassociated with each green box measure that

imposes restrictions on the procurement and openmarket sales of the stocks.

For instance, in the context of publicstockholding for food security, the clause states

Food purchases by the government shall bemade at current market prices (Annex 2,Clause 3).

and elsewhere,Food purchases by the government shall bemade at current market prices and thefinancing and administration of the aid shallbe transparent (Annex 2, Clause 4).

The procurement operations and the disposalof stocks in the open market, domestic andinternational via exports will invite scrutiny,especially in the context of a renewedcommitment to ensuring that green box subsidieshave �no, or at most minimal, trade-distortingeffects or effects on production�.3 If procurementis done at current market prices or less, thenthere is no subsidy involved. If, on the otherhand, the procurement is done at minimumsupport price (MSP), then a subsidy is involvedand the requirement is that the differencebetween the acquisition price and the externalreference price (ERP) should be accounted forin domestic support and therefore part of amberbox measures.

Procurement OperationsIn general, the AoA requires that

procurement of foodgrains for maintaining stocksshould be at market prices (implying that theyshould not be higher than market prices) andthat it should not be protectionist in the sensethat it should not exceed the world price (apredetermined ERP, committed as part of theAoA).4

The commitments under the WTO AoA arein the form of an Aggregate Measure of Support(AMS), which is the difference betweengovernment support price and a fixed ERPmultiplied by the total quantity of agriculturalproduct eligible for that support, represented asa percentage of total value of the production ofthe commodity (assessed at the administeredprice). The allowable limit for developing


countries (called the de minimis support) is 10percent of the total value of agriculturalproduction.

There are however a few technical issuesinvolved in computation that are outlined inAnnex 3 of the AoA. First, the ERP is fixed at the1986-89 base period. For India, the ERP is fixedat Rs 3,520 (US$262.5) per metric tonne for riceand Rs 3,540 ($264) per metric tonne for wheat.India�s base year notification (G/AG/AGST/IND)was denominated in Indian rupees (INR),although in later years, India used an ERPdenominated in dollars to compute the AMS.Article I (h)(ii) of the AoA specifies that incalculating the current AMS the constituent dataand methodology used in the original notificationor supporting tables have to be used (Hoda andGulati 2013). This use of a dollar ERP is there-fore not in conformity with the requirements ofthe AoA.

It is expected that the Government of Indiawill provide revised notifications. If the ERP isestablished in INR then the figures for domesticsupport would account for neither domesticinflation nor for changes in the dollar-rupeeexchange rate. An ERP denominated in dollarswould factor in exchange rate movements so thateven if the ERP is fixed, the conversion of thedomestic MSP into dollars would be at currentexchange rates. This article computes supportfor rice and wheat using both methods forexpository purposes.

Second, the reduction commitments withrespect to the AMS imply different things fordifferent members. For those WTO members whohave undertaken reduction commitments becausetheir domestic support exceeded the de minimisfor the base period, the limits prescribed forsupport are with respect to the total AMSsummed over all the commodities for whichsupport is provided, expressed as percentage ofthe total value of production of thesecommodities. These countries thus have someflexibility in subsidising individual products aslong as the overall committed level is notbreached. In other words, the de facto limits ofproduct-specific support for these countries ison the total AMS, so that within this total someproducts can in theory exceed the de minimis as

long as the total AMS does not breach the overallcommitment levels.5

This is, however, not the case for countriesthat have not undertaken reductioncommitments, including developing countrymembers like India. For these countries, there aretwo separate elements in the obligation. First,that the product-specific support in respect of aparticular product does not exceed 10 percentof the value of production of that particularproduct; and second that non- product-specificsupport does not exceed 10 percent of the valueof the total agricultural production. In light ofthis interpretation India has to show that thesubsidy on rice divided by the value of productionof rice does not exceed 10 percent and thus toofor Wheat. This is now settled WTO law,confirmed by the Appellate Body of the WTO inKorea- measures Affecting Imports of Fresh,Chilled and Frozen Beef.6 As Hoda and Gulati(2008:27) emphasis there us thus significantinequality in the AoA but this neverthelessestablishes the contextual constraints for theNFSA.

According to the AoA, even though publicstocking and domestic food aid are green boxmeasures, even for these interventions,

The difference between the acquisition priceand the external reference price has to beaccounted for the AMS (Annexure 2, Clause3, footnote 5).

The relevant question now is whether with theimplementation of the NFSA , the AMS willbreach the 10 percent de minimis, especiallyconsidering that in the recent past, theprocurement volumes are already at levels thatwould be required under the NFSA.

In order to understand the implication of theNFSA for India�s domestic support commitmentsunder the AoA, we compute support for rice andwheat using both the method that is mandatedby the AoA and that which the GOI has followedfor the notifications until 2003-400.7 Table 1presents the AMS for rice and wheat using thesetwo methods� the first where the ERP isdenominated and fixed in dollars (not conformingto the AoA), and the second where the ERP isdenominated and fixed in rupees (as per the base


period notification). The total AMS is notpresented here since the focus is only on twomajor commodities, rice and wheat. In general,India notifies the WTO on domestic supportfor only the commodities for which there is activeintervention: rice, wheat, cotton, jute and coarsecereals, among others. Until 2007-08, the supportfor both rice and wheat was systematicallynegative (Figure 2, p 44).

Since 2008-09, however, rice support hasturned positive while wheat support has mostlybeen negative. Rice support has increased steeply

over the years. That said, until now, even in theyears where the procurement prices have beenhigh and volumes procured have exceeded theannual requirements under the NFSA, product-specific support neither to wheat nor to rice hasexceeded 10 percent of the value of wheat andrice production, respectively (Table 1). Given thatthe current levels of procurement are consistentwith full implementation of the NFSA, thesupport levels are unlikely to be much higher thanthe figures provided.

Table 1: Support to Rice and Wheat under Different Methodologies

1. Sources and Notes: The ERP in (1) is that in G/AG/N/IND/7 India�s notifications to the WTO and for (2) and (3) as in Schedule XII(G/AG/AGST/IND).

2. For 1995-96 to 2003-04, data for (1) comes from India�s notifications to the WTO, for the years after (denoted by *) the estimatesare derived following the same method with data from the same sources.

3. The fixed External Reference price is the 1986-88 average reference price assessed at exchange rate of Rs 13.409/$ under the originalagreement.

4. The applied administered price is the minimum support price in Rs per tonne expressed in $/tonne using the official annual exchangerate � from the Agricultural Statistics at a Glance, 2013 and Economic Survey, various years. For MSP, the paddy MSP is convertedto rice using a ratio of 1.5 and the marketing and crop years are maintained as in the notifications.

5. Eligible production refers to the procurement volume except for the year 1995-96 which is the year when the URAA came into force;here, it is total production. The source is Agricultural Statistics at a Glance, 2013. The total rice production for 1995-96 is assumedto be the same as eligible production for the sake of consistency. For all other years it is the actual production from AgriculturalStatistics at a Glance, 2013.

6. For inflation-adjusted estimates, the method followed has been that of Hoda and Gulati (2013). The inflation rate uses WPI (allcommodities) for financial year applied to the base ERP from the Economic Survey (various years).

7. For moving reference price, the external reference prices are from World Bank Pink Sheets, Thai 25 percent broken for rice and USHRW for wheat. The estimates are imprecise because the marketing year and financial year might not coincide.


However, as stated previously, the methodfollowed by the GoI for the notifications until2003-04 does not conform to the requirementsof the AoA which specifies that the methodologyshould be consistent with that used for the baseyear notification.8 Table 1 also presents themethod that is consistent with the requirementsof the AoA. With this fixed ERP denominated inINR, it is evident that the product-specificsupport for rice breached the 10 percent limit wayback in 1999-2000 and has been increasing sincethen. For wheat too, the 10 percent limit wasbreached on several occasions in the past decade,long before procurement volumes reached thelevels comparable to those that would be underthe NFSA.

The concerns relating to India�s commitmentsunder the AoA therefore predate the NFSA, ifone considers the methodology of the base periodnotification that the GoI ought to have followed.

Whatever the method, from the perspectiveof procurement to support the NFSA, certainprovisions in the AoA lend support to India�spolicy interventions in rice and wheat markets,under specific circumstances. Part XI, Article 18(Review of the Implementation of Commitments,Clause 4) of the AoA suggests that in the review

process �Members shall give due considerationto the influence of excessive rates of inflation onthe ability of any member to abide by its domesticsupport commitments�. The US and several othercountries are of the view that members cannotget the benefit of inflation automatically and thatthe committee has to determine what �dueconsideration� is as laid down in Article 18.4.This issue is now likely to be deliberated upon inthe work programme that the Bali ministerialmeeting is likely to approve.

Figure 2 maps the estimate of the product-specific support for rice and wheat, where theERP is adjusted for inflation, using the methodthat strictly conforms to the base periodnotification. According to these figures, althoughthe figure for rice has turned positive it is evidentthat one gives due consideration for inflation, thesupport levels are little cause for concern. AsTable 1 shows, in 2012-13, support to rice andwheat combined, as a percentage of total valueof rice and wheat production was -6 percent (apositive 1.1 percent for rice and -17.4 percentfor wheat). These are consistent with estimatesby Hoda and Gulati (2013) using the samemethod that adjusts the ERP for inflationreveals that in 2010-11, the product-specific

Figure 2: Rice and Wheat Product Specific Support (1995-2013)

Source: See Table 1 for detais.


support to wheat was -10.22 percent of the totalvalue of wheat production and for rice it was -2.87 percent of total value of rice production. Ifdue consideration is indeed provided for inflation,then even with the NFSA India is unlikely tobreach its commitments at current levels ofprocurement.

If such flexibility with respect to inflation isobtained, India would merely have to ensure thatthe product-specific subsidies do not grow sorapidly as to breach this threshold. This couldhappen in two scenarios. The first scenario iswhen large rises in MSP (or bonuses) are offeredwithout a commensurate and counter balancingincrease in either overall production ordepreciation in the exchange rate. The second isopen-ended procurement that goes well beyondthe required levels, as this would inflate theeligible production for support and contribute tohigher AMS. As it turns out both these aspects offood management have come under criticism,regardless of the WTO commitments. Theseaspects demand attention anyway.

As long as the government has a coordinatedapproach to procurement and pricing policy, itis quite feasible to maintain support levels wellbelow the de minimis of 10 percent given dueconsideration. Indeed, even if commitments areconverted to commodity specific de minimis levelsof 10 percent with judicious policy, India could

conceivably meet its WTO AoA commitmentswithout undermining the NFSA.

There has long been a discussion on revisingthe base year from the original 1986-88 to a lateryear to reflect contemporary circumstancesbetter. The reference price was originally fixedat the 1986-88 base period which were regardedas years of relatively low prices. But the foodprice crisis in 2008 and after has seen much higherprices reign in wheat and especially in ricemarkets. An examination of the support torice and wheat using the same methodology buta varying reference price (Figure 4, p 45, Table1) suggests that India in fact continues to recordnegative support for most of the years even forrice, suggesting that in the coming negotiationsthe choice of base year for an ERP could becomea rallying point. The choice of a new base yearwill however necessitate an amendment in theAoA, which would be more difficult. On the otherasking for full automatic adjustment for inflationunder �due consideration� is likely to be easieras it will involve only a decision by the Committeeof Agriculture under Article 18.4.

Also, should the issue of a higher de minimislevels with product-specific de minimis bediscussed this is an area that India could argueto retain some bandwidth. Overall, while theGoI would do well to keep a watchful eye onthe numbers, stoking fears that India would

Figure 3: �Due Consideration�: Adjusting ERP for Inflation

Source: See Table 1 for detais.


be breaching commitments because of the NFSA,seem unfounded if one acknowledges that thecurrent levels of procurement already matchthose demanded by the NFSA and consideringthat by the method followed in the base yearnotification and the unfortunate choice ofcurrency unit, the thresholds were crossed in theearly part of the decade, when procurement wasaround 30 million tonnes.

Foodgrain ExportIn the context of India�s commitments to the

WTO, the more contentious issue would be India�sidiosyncratic export (and import policy). TheAoA requires that

sales from food security stocks shall be madeat no less than the current domestic marketprice for the product and quality in question(Annex 2, Clause 3).

Similarly, the clauses on export subsidiesexplicitly forbid dumping in internationalmarkets. The recent condemnation of the G-33proposal by the US ambassador to the WTO,Michael Punke voices fears that the foodmanagement strategies of India would distortworld trade (worrying that first India�s stockingwill push up world prices and then later thatcheap exports would affect farmers� interestsworldwide). While Punke�s evidence base is flimsyand contestable9 the underlying point is that

India�s trade policy (both exports and imports)would have serious impacts on global prices andtrade and an idiosyncratic �stop-go� policy wouldraise hackles. The implications of governmentfood management practices, or mismanagementas some would have it, for India�s commitmentsneed careful attention.10

Under the WTO AoA, transgressions wereprotected by what came to be known as a peaceclause or due restraint under Article 13. Thepeace clause, which expired in 2004, alloweddomestic support measures and export subsidiesto not be challenged by other WTO members.Since its expiry in 2004 it has left countriesexposed to the possibility that other membercountries could push for retaliatory measuresshould there be evidence that the interventionscause a breach or/and therefore a distortion inworld trade.

Non-Product Specific AMS: InputSubsidies

Non-product specific support, i.e., inputsubsidies on fertiliser and electricity to agriculturehave posed a greater problem for India from afiscal perspective and continue to do so, incontrast to the product-specific support. This pastdecade has seen fertiliser and power subsidiesburgeon in the wake of extraordinarily highinternational urea prices. So far, India has

Figure 4: Rice and Wheat Product Specific Support Fixed versus MovingExternal Reference Price (ERP)

Source: Computed by author. For moving reference prices, the source is the World Bank Pink Sheet prices.Thai 25 percent broken for rice and US HRW for wheat in $, with administered price converted using annualexchange rates. The method followed is the same as for a fixed ERP in $.


reported that proportion of these subsidies goingto low income and resource-poor farmers asgreen box measures, by assigning a part of thebudgetary subsidies as accruing to small- holders(G/AG/IND/N/7, Gopinath 2008). India�s baseyear notification states that 98 percent farms areof low income and resource-poor farmers; it hasnotified all input subsidies as covered byexemptions. In later years, that part of inputsubsidies presumed to go to larger farmers iscounted as part of non-product specific supportand this figure was well under the de minimisnon-product specific support of 10 percent untilrecently (ibid). Despite the recent increases infertiliser and credit subsidies through interest ratesubventions, it is unlikely that this will be causefor concern. However, should there be majorchanges proposed in this area in the impendingtalks that impose restrictions on input subsidies,this would be an additional area of concern. Tothe extent that curtailing input subsidies mightalso impinge on food production, the GoI wouldhave to work on a coordinated policy on thesedifferent fronts.

The Way AheadThis article suggests that the support that the

NFSA would entail is unlikely to be substantiallylarger relative to current levels. Over the pastfive years, India�s support levels in the contextof the AoA have increased significantly relativeto those during the late 1990s or early 2000s. Itis however within the span of permissibleprovisions under the WTO�s AoA, if dueconsideration is given for inflation. Theunfortunate choice of India to denominate thebase period notification in INR is perhaps at theheart of this. With an ERP denominated indollars, the support levels at current levels ofprocurement are within the de minimis thresh-old for developing countries. While theobservation made by Gopinath and Laborde(2008) that India has ample flexibility in settingand implementing domestic support policies isperhaps less valid today, there is enough room

within the framework of the AoA for anintervention such as the NFSA, given that cur-rent support levels pertain to the scale ofoperations commensurate with the fullimplementation of the NFSA.

In this context, how can India move forwardas the Ninth WTO Ministerial Conference in Baliunfolds? The contours of the negotiations processhave shifted quite a bit since the global food pricecrisis and fears of high rice prices. In general itsaw a host of grain exporting countries resort tovarious sorts of controls to keep food pricesdown. The Doha Development Agenda hadalready promised not to give food security a shortshrift. But these issues are likely to be heavilycontested. The recent G-33 �non- paper� on foodsecurity by India and other countries seekingspecial measures to protect policies supportingfood security has attracted much criticism fromdeveloped countries and grain exporters.

There is some discussion on whether toestablish a �peace clause� that would providedeveloping members with food security issueswith an exemption linked to their programme.An alternative to seeking special protection toenable the implementation of the NFSA wouldentail negotiating on a few technical andsubstantive details, such as due consideration forinflation, de minimis levels that allow enoughbuffer, a revised ERP, all within the existingframework.11 Some of these would be harder toobtain than others, especially those that requirean amendment of the AoA. It is worth reiteratingthat the NFSA would not represent a marketintervention that is substantially larger relativeto current levels. It stands to reason however thatregardless of the pressures implied by the WTO�sAoA, India needs to revamp its food managementsystems in a way that ensures transparency,accountability and predictability. Further, itwould entirely be to India�s benefit to achievemore cost-efficient methods of procurement,storage and transport. This would be essentialnot only to fulfil the mandate of the NFSA but toenable India to meet its international obligations,in both letter and spirit.


Endnotes

1. Others include Venu (2013), Sharma (2013), etc.

2. See for instance, www.thehindu.com/business/Economy/food-subsidy-issues-need-to-be-addressed-wto/article5210832.ece; www.thehindubusinessline.com/economy/india-may-settle-for-compromise-solution- to-food-security-issue-at-wto/article5210230. ece, accessed on 15 October 2013.For atranscript of the speech by Punke, US ambassador to the WTO, see http://www.ustr. gov/about-us/press-office/speeches/transcripts/2013/april/amb-punke-statement-wto-tnc, accessed on 15 October2013.

3. WT/MIN(05)/DEC, para 5.

4. This would be different for exporting and importing countries, i.e. free on board for a net exporter andfreight including cost, insurance and freight for an importing country.

5. Part IV, Article 6.

6. WT/DS161/AB/R; WT/DS169/AB/R.

7. India has not filed notifications on domestic support for the years after 2003-04.

8. This is based on the WTO method but as reported in the Supporting Tables Relating to Commitmentson Agricultural Products contained in Schedule XII (G/AG/AGST/IND). This differs from India�sreporting formats for subsequent years.

9. In the absence of evidence, one could easily argue the opposite. One could claim, for instance, thatIndia�s stocking policy would help poor countries because in its absence, India might import grainsthat would push up global prices. Alternatively, one could claim that when India exports, it keepsfood prices low for net food importing countries. The basis of such arguments rests on one�s point ofview and not much else.

10. www.ustr.gov/about-us/press-office/ speeches/transcripts/2013/april/amb-punke-statement-wto-tnc

11. The Draft Modalities of 2008, which documents some of these proposals, suggests the limit ofsupport for developing country members as measured by AMS, be 20 percent of the average totalvalue of agricultural production in the 1995-2000 or 1995-2004 period as may be selected by themember.


Exhibit-1

The National Food Security Bill, 2011Right to Entitlement to Food and Nutrition

The National Food Security Bill, 2011Right to Entitlement to Food and Nutrition

Highlights

Creates a right for somesections of the population tocertain entitlements to foodand nutrition

Mandates reform in thepublic distribution system(PDS) including addressingits transparency andaccountability aspects

Endeavours to empowerwomen and othermarginalised sections of thesociety

Sets up national and sub-national bodies forgrievance redressal as wellas monitoring theimplementation of the Bill

Tries to address issuesrelated with revitalisation ofagriculture – procurement,storage and movement offood grains and otherimportant elements for theadvancement of foodsecurity

Lowlights

Limited treatment of “food security” as anunderstood concept; focuses only onentitlements, and ignores production and tradeaspects

Division among three groups – priority, generaland excluded – and adopting a complex,impractical and politically contentious‘inclusive’ criteria that too to be provided atlater stage

Fails to design a decentralised mechanism forprocurement, storage and distribution of foodgrains and letting status quo to continue

Non-inclusion of more nutritious food itemssuch as pulses and oil in the benefit package

Not proposing a much-needed pan-politicalbody for monitoring the implementation of theBill

Non-inclusion of farmers and community-based organisations in the National and statefood commissions as members

Provisions related with revitalisation ofagriculture in the context of advancing foodsecurity have important missing elements suchas the impact of climate change and soil healthon agricultural productivity

On December 22, 2011, the Union Minister of State (Independent Charge) for ConsumerAffairs, Food and Public Distribution introduced the National Food Security Bill in the LokSabha (the Lower House of the Indian Parliament). On January 05, 2012, the Bill wasreferred to the Parliamentary Standing Committee on Consumer Affairs, Food and PublicDistribution. This Committee is expected to submit its report to the Parliament in the firstweek of April 2012.

The Bill which aims “to provide for food and nutritional security in human life cycleapproach, by ensuring access to adequate quantity of quality food at affordable prices topeople to live a life with dignity” marks a “shift from the current welfare approach to right-based approach to address the problem of food security”.1

I N S I D E

Introduction

General Issues

Specific Issues

Conclusion

Action Points

#1/2012

The Bill at a Glance

2

IntroductionThe Right to Food was first recognisedin the United Nations Declaration ofHuman Rights, 1948. In the UnitedNations Guidelines for ConsumerProtection, 1985, the right to foodwas mentioned as the first right underthe Right to Basic Needs.

In 1996, the formal adoption of theRight to Adequate Food by the WorldFood Summit paved the way for thepossibility of a right-based approachto food security.2

In India, Article 47 of the Constitutionof India, inter alia, provides that “theState shall regard raising the level ofnutrition and standard of living of itspeople and the improvement of publichealth as among its primary duties”.

The present Bill is a result of theseinternational and constitutionalobligations. The Bill is about somespecified entitlements to “right to foodand nutrition” to certain sections of thepopulation.

This brief does a critique of severalprovisions of the Bill, highlights somecontentious issues and makes somerecommendations for its improvement.

General IssuesFood Security: A MisnomerAlthough the efforts that are beingmade by the Government of India toenact the National Food Security Bill,2011 is laudable, its nomenclature(food security) is a misnomer.

The present internationally acceptabledefinition of food security, as adoptedby the 1996 World Food Summit,states: “Food security exists when allpeople, at all times, have physicaland economic access to sufficient safeand nutritious food that meets theirdietary needs and food preferencesfor an active and healthy life”.

From this definition, four majordimensions of “food security” are asfollows:• Physical availability of food• Economic and physical access to food• Food utilisation• Stability of the above three

dimensions over time

For the realisation of food securityobjective, all the four dimensions mustbe fulfilled simultaneously.3

The definition of “food security” asprovided in Section 2(7) of the Bill

clearly fall short of the internationallyaccepted definition.4 First, the Billdoes not adequately address ‘physicalavailability’ of food – the supply-sideof food security.

Schedule III of the Bill, read withSection 39, apart from being deficientin many other respect, contains mere“best endeavour” provisions that arenon-enforceable, amounting to non-obligation on the part of the Centreand state governments.

Secondly, the Bill is deficient with respectto “economic and physical access”because of its ‘non-universal incoverage’ and ‘inadequate procurementand distribution mechanism’, althoughit contains some positive provisionsabout reforming the PDS.

Not only the present accepteddefinition, but through out all thestages of evolution, the notion of“food security” has included “allpeople, at all times” approach.5

Even the version of the Food SecurityBill dated July 2011 prepared by theNational Advisory Council, headed bySonia Gandhi tends to follow theuniversality of access approach tofood security.6

Table 1: Four Dimensions of Food Security

Physical AVAILABILITY of food Food availability addresses the “supply side” of food security and is determinedby the level of food production, stock levels and net trade.

Economic and physical An adequate supply of food at the national or international level does not inACCESS to food itself guarantee household level food security. Concerns about insufficient food

access have resulted in a greater policy focus on incomes, expenditure, marketsand prices in achieving food security objectives.

Food UTILISATION Utilisation is commonly understood as the way the body makes the most ofvarious nutrients in the food. Sufficient energy and nutrient intake by individualsis the result of good care and feeding practices, food preparation, diversity ofthe diet and intra-household distribution of food. Combined with goodbiological utilisation of food consumed, this determines the nutritional status ofindividuals.

STABILITY of the other Even if your food intake is adequate today, you are still considered to be foodthree dimenstions over time insecure if you have inadequate access to food on a periodic basis, risking a

deterioration of your nutritional status. Adverse weather conditions, politicalinstability, or economic factors (unemployment, rising food prices) may have animpact on your food security status.

Source: An Introduction to the Basic Concepts of Food Security; United Nations Food and Agriculture Organisation, 2008

3

Later, a Committee headed by C.Rangarajan, Chairman of theEconomic Advisory Council to thePrime Minister rejected this approach,presumably because of expectedfiscal stress that it would bring to theexchequer.

Thirdly, “food utilisation” aspect isalso weak in the Bill. While nutritionrequirements for pregnant women,lactating mothers and children havebeen mentioned, those belonging to“priority and general household”have been skipped.

For instance, among other things,access to safe drinking water, whichis necessary for better biologicalutilisation of food, finds place only inSchedule III, a non-obligation on partof the state.

Finally and as far as ‘stability’ aspect isconcerned, the Bill does not reflect uponthe possible effects of climate change onagricultural productivity, which isrecognised as a major challenge.

On the contrary, the government haskept itself out of liability for forcemajeure conditions, including floodand drought which are happeningmore frequently in recent yearsunderstandably due to, among othercauses, climate change.

More so, the Bill is weak with respectto the more modern concept of‘sustainable food system’ that has co-relation with ‘stability’ and includes‘climate change’, ‘land use’ and ‘soil’as important ingredients.7

In light of this analysis, it is clear thatthe use of “food security” as the titleof the Bill is misplaced and liable toconfuse people as well as nationaland international institutions workingon food security issues.

The Bill, in its present form, can at bestbe called “the Right to Entitlement toFood and Nutrition Bill”.

Inclusion vs. ExclusionEven after accepting constraints onpart of the government to provide

universal entitlement for access tofood, an important question remains:whether to follow a complexapproach of identifying those who areto get such entitlements (as is the caseof the present Bill) or to follow a moresimple approach to exclude thosewho are not entitled by defining anexclusion criteria. There is a generalconsensus across the board onadopting the latter approach.

The Bill segregates households intothree groups: priority, general andexcluded to have major entitlements,token benefits and nothing,respectively – Section 3(1).8

Furthermore, entitlements will beextended up to 75 percent of ruraland 50 percent of urban population,provided not less than 46 percent ofrural and 28 percent of urbanpopulation are designated as “priorityhousehold” at all India level – Section3(2) and Section 14(1).

There can be differences in suchpercentages in different states, whichwould be determined by the Centre –Section 14(2). The Centre mayprescribe guidelines for identificationof priority and general householdsand exclusion criteria and states (orany other agency decided by theCentre) would have to identify suchhouseholds in accordance with thesaid guidelines – Section 15(1) andSection 15(2).

The task of periodically updating thelists of eligible priority and generalhouseholds will be carried out by statesbut in a manner prescribed by theCentre – Section 17.

Any person having some knowledgeon contemporary issues of Centre-State relations in India wouldunderstand the kind of problems thatthe above-stated approach will invite.First, there will be tension with respectto mandates of Centre and states inthe covered subject areas.

Secondly, it is expected that there willbe disagreement about the numberof eligible households that a state willcount and its acceptance by the

Centre, and this tension will be inperpetuity because such countingwould have to be a dynamic exercise.

Even if the Centre decides to assignthis task of counting eligiblehouseholds to an independentagency, states may object because ofthe normative nature of the subject.

A good policy is the one that takesinto account probable gaps thatcould arise during its implementation.True that it is impossible to visualisean exhaustive and mutually exclusivelist of implementation gaps whileformulating an act, but severalobservable fact from theimplementation of similar welfareschemes in India points to somepossible gaps in the present case. Theyshould be avoided and addressed atthis stage itself for betterimplementation of the Bill.

A simple framework for countingeligible households, which is practical,transparent, equitable and politicallyappealing and suggested by manyexperts, is to “abolish the distinctionbetween general and priority groupsand give all households a commonminimum entitlement under PDSunless they meet well definedexclusion criteria”.9

The definition of ‘entitled households’could be: “those households which donot meet the exclusion criteria givenunder section…” It would be better tohave categories as “entitledhouseholds” and “excludedhouseholds” as against the presentthree categories.

A dynamic mechanism should be inplace so as to enable “entitledhouseholds” to self-declare theirgraduation from subsidisedentitlement.

As far as constraints related to foodproduction and procurement (and thisformed an important basis, apartfrom fiscal stress, for cappingentitlements and adopting acalibrated approach to suchentitlement by the Rangarajan

4

Committee) is concerned, it canbe addressed under a two-tiersystem as well.

Depending upon the capacity ofthe government to procure (say30 percent of total production)and subsidise (say M17 per kg ofrice and a total subsidy of sayM100,000 crore a year), anexclusion criteria can be formedand revised periodically by takinginto account changes in the givenconstraints.

Even the Minister for ConsumerAffairs, Food and PublicDistribution has reportedly saidthat the financial burden wouldnot be “unusually big” if anapproach of eliminating theAbove Poverty Line category isfollowed.10 The idea is: simplerthe framework, lesser thelikelihood of implementation gaps.

Procurement and DistributionRegarding “procurement anddistribution” there is a duality inthe Bill. According to Section30(5) of the Bill, the Centre ismandated to procure food grainsfor the Central pool andsubsequently allocate food grainsto the states for the purpose ofmeeting the entitlements.

At the same time it demands theCentre, the State and localauthorities to strive to progressivelyrealise decentralised procurement– Schedule III (2)(a) and Section39 of the Bill. The differencebetween the two provisions is thatwhile the former is enforceable,the latter is non-obligatory.

It is recommended that not onlythe procurement be done by thestates and the institutions of localgovernance but also theresponsibility of storage anddistribution be vested in them.

Even a note dated March-April2010 from Union FinanceMinistry meant for the concernedEmpowered Group of Ministers

seems to advocate locally boughtgrain “to the extent possible” inthe context of PDS reform.11

This will not only save significanttransportation costs of foodgrains,but could also make “theexpansion of rakes and linecapacity of railways” – ScheduleIII (2)(d) of Bill – unnecessary orat least less prioritised.

Most importantly, this willempower farmers, a vast majorityof whom are not able to makeuse of the present centralisedpublic procurement system offoodgrains consequently obtainmuch lesser remuneration thaneven the minimum support price(MSP) from non-state buyers.

State governments shouldmaintain a certain portion ofprocured food grains in a reservepool and that cannot be used forforward trading and otherspeculative activities.

The Centre’s role in this regardshould be, as far as possible,limited to the creation of anational grid for coordinatingfood distribution (from surplus todeficit states) and its price (that adeficit state will pay a surplusstate).

The modalities of defining MSPare to be relooked. Stategovernments may be left to decidethe MSP of a product, whichshould be remunerative tofarmers (say average cost ofproduction plus its 50 percent). Tocompensate any additional fiscalstress on this count, subsidies oninputs (fertiliser etc.) can either bereduced or eliminated alltogether.

Specific Issues

• The definition of “food grains”under Section 2(6) does notinclude ‘pulses’, which is animportant source of proteinand integral to daily dietary

preference of all Indians. Atleast half-a-kg of pulses perperson per month should beincluded in the entitlementeven if it requires cutting onentitlements to other foodgrains. If possible somequantity of cooking oil mayalso be added to thepackage. This will not onlymake the programe morenutritious but will alsoincentivise farmers to growmore pulses12 and oil seeds.

• Link benefits to lactatingmothers with obtaining birthcertificates for their child –Section 4. Anganwadi workersneed to be trained to flag thisto such mothers when theystart receiving benefits onaccount of their pregnancy,and subsequently facilitate inobtaining it.

• Instead of providing cookedmeal in schools, if feasible,there could be a centralisedfacility (e.g. communitykitchen) at the anganwadi level– Section 5(1)(b) and Section5(2). It has been observedthat cooking in schools isadversely affecting the qualityof education, a nationalconcern. As far as possible,the cooking of meals shouldbe physically managed by“special groups” – Section 8and Section 10. Apart frommanaging cooking, destitutepersons should be engagedin other community services,particularly in urban areas,such as cleaning.

• Food security allowance asunder Section 13 should becoupled with proposedreforms in the PDS. Thereshould be well-definedmechanism to disincentivise“excluded groups” fromentering into “entitled groups”who would be eligible forcash entitlements.

5

• Proposed reforms in the PDSare a welcome step – Section18. However, much more areneeded. The PDS should belinked with the localprocurement and storagesystem as far as possible –Section 18(2)(g). Consumercooperatives should beencouraged to manage thepublic distribution – such anin-built mechanism for publicaction will make it moretransparent and accountable.

• Proposed structure for grievanceredressal (Chapter IX) is goodbut it should be taken to the levelof local governance institutions.Those who will be engagedwith the procurement, storageand distribution of food grains(including managing the PDSat the local level) should not bepart of the institution ofgrievance redressal.

• The penalty as provided underSection 41 against defaultingpublic servant and/orauthority is low and should beincreased to have a minimumthreshold level of deterrence.

• Section 52 should read “anyother act of God” instead of“any act of God” as flood,drought, cyclone, earthquakeare included in “act of God”.

• There should be a mandatoryreview clause in the Bill, whichwill make it mandatory toreview its implementation aftera certain time period, say fiveyears.

• Provisions under Schedule IIIshould be looked at as partof an enabling environmentfor addressing the ‘stability’aspect of food security andthey should be dynamicallymonitored with some additionsand rearrangements, such as:

A new section on “climatechange and agriculture”

Add provisions for‘improving soil quality’ aspart of revitalisation of theIndian agriculture

Make ‘ensuringremunerative prices forfarmers’ a standaloneprovision

Irrigation and energyrequirements should beplaced under separateprovisions from financialissues like credit andinsurance

Specific provisions shouldbe made underlining theimportance of publicinvestment in agriculture(particularly in respect todeveloping new and largeirrigation facilit ies,research anddevelopment, andagricultural extensionservices) and itscomplementarity withprivate investment(including investment inminor irrigation)

ConclusionAlthough it took a long time forthe government to adopt a right-based statutory approach toaddress the issue of food securityin India and despite beingdeficient on several counts, theeffort of the government shouldbe applauded in a non-politicised and non-dogmaticmanner.

As discussed earlier, the Bill, in itspresent form, cannot be called anexpected Act on ‘food security’understood as a concept. But withsome suggested amendments theBill would eventually lead thecountry toward attaining the goalof universal food security.

Critics of the Bill should be moreobjective in their critique. A popularcriticism is that there may not be

enough food to fulfill the proposedstatutory entitlements and it wouldincrease food grain prices in theopen market.

According to an estimate done bythe Department of ConsumerAffairs, Food and PublicDistribution, Government ofIndia, at present about 30 percentof India’s food grain productionis procured (mainly for publicdistribution) and the rest isavailable in the open market.

As per this estimate (which ismade up to the year 2040), therewill be no shortage of foodgrains to fulfi l l statutoryentitlements as well as in the openmarket.

This is not to say that in future foodgrain prices will not increase butthat (price increase) is happeningand will happen unlessanticompetitive practices in theIndian food grains markets andits procurement system areaddressed.

Another criticism is that theproposed Bill will put more fiscalburden to the Centre and stategovernments. Again, as per anestimate of the Department ofConsumer Affairs, Food andPublic Distribution, Governmentof India, annual fiscal subsidyrequirement for implementing theBill in its present form will bebetween M100,000 to 120,000crores, which represents just overone percent of India’s grossdomestic product. Even therevenue forgone by thegovernment is five times thisamount.13

Also it is to be noted that atpresent India spends M60,572crores for the existing food supplyprogramme under the TargetedPDS, which is pegged to the1993-94 estimate and thepopulation figure of the year2000 census.

Endnotes1 Preamble to the National Food Security Bill, 2011; Statement of object and reasons, annexed to the Bill2 United Nations Food and Agriculture Organisation, Policy Brief, June 2006, Issue 23 An Introduction to the Basic Concepts of Food Security, United Nations Food and Agriculture Organisation, 20084 Section 2(7) of the Bill: “food security” means the supply of the entitled quantity of food grains and meal specified under Chapters II,

III and IV5 The FAO in 1983, World Bank in 1986, World Food Summit in 1996, FAO again in 2001 adopted definitions of “Food Security”

that have “all the people, all the time” as the coverage6 See the Preamble and Section 4 of NAC’s Food Security Bill7 See, for example, Looking Back, Looking Forward: Sustainability and UK Food Policy 2000-2011; Sustainable Development

Commission, UKhttp://www.sd-commission.org.uk/publications.php?id=1187

8 Dreze, Jean, Just Target The Rich, Times of India, February 04, 20129 Ibid10 Zia Haq, Government likely to tweak food bill to widen coverage, Hindustan Times, February 29, 201211 How 3 pages changed government approach, Mint, February 01, 201212 National Sample Survey data show that there is a steady decline in protein intake by the Indian population13 In the financial year 2010-11, total revenue forgone on account of income tax, excise and custom duty was M511,630 crore –

www.indiabudget.nic.in14 Supra 10

Comments received from Jean Dreze (Visiting Professor, G B Pant Social Science Institute, Allahabad), Reetika Khera (Assistant Professor,Department of Humanities and Social Sciences, Indian Institute of Technology, New Delhi), Timothy Lang (Professor of Food Policy, CityUniversity of London), Milind Murugkar (Policy Analyst, Pragati Abhiyan, Maharastra), Pradeep S. Mehta (Secretary General, CUTS International)and George Cheriyan (Associate Director, CUTS International) have been suitably incorporated. A draft version of this paper was presentedat a meeting of the Parliamentarians’ Forum on Economic Policy Issues (PARFORE, a CUTS initiative – www.parfore.in) held in New Delhi onDecember 20, 2011. Comments were received from K V Thomas, M S Swaminathan, Bhalchandra Mungekar, E M S Natchiappan, M VMysoora Reddy and Ashok Ganguly.

© CUTS, 2012. This document is produced by CUTS and is a brief for Parliamentarians in understanding new legislation and enhancing thequality of the debates so that better laws are enacted. Readers are encouraged to quote or reproduce material from this paper for their own use,but as copyright holder, CUTS requests due acknowledgement and a copy of the publication.

This paper has been researched and written by Ujjwal Kumar and Bipul Chatterjee of and for CUTS International, D-217, Bhaskar Marg, BaniPark, Jaipur 302 016, India. Ph: 91.141.228 2821, Fx: 91.141.228 2485, E-mail: [email protected], Website: www.cuts-international.org, andprinted by Jaipur Printers P. Ltd.,Jaipur 302 001, India.

For viewing other Bill Blowups, please visit: www.parfore.in/BillBlowups.htm

Action PointsChange the title from “the National FoodSecurity Bill” to “the Right to Entitlement toFood and Nutrition Bill” and specify that “it doesnot create a fundamental right to food forcitizens” if the present form of the Bill is retained

Abolish the distinction between general andpriority groups and give all households acommon minimum entitlement under the PDSunless they meet well-defined exclusion criteria

Have explicit provisions for decentralisedprocurement, storage and distribution of foodgrains through institutions of local governance

Include pulses, oil and other nutritious food items in theentitlements, thus increasing nutritious value of the benefitpackage

Make chief ministers and Prime Minister ex officiochairperson of state food commissions and National FoodCommission, respectively, and include at least a farmer anda community representative as members in both institutions

Bestow more emphasis, as done for the PDS reforms, tothe provisions under Schedule III of the Bill including addingprovisions with respect to climate change, soil health and abuilt-in mechanism for monitoring the progress on keyelements mentioned therein

Application of the year 2011 censusand updated poverty estimate for thepurpose of targeted PDS will raisefood subsidy to M109,795 croreeven if this Bill does not come intoforce.14

Therefore, it is clear that India’s fiscaldeficit is not likely to becomeunmanageable following the

enactment of the National FoodSecurity Bill.

Moreover, in the long-run, asmore and more households areexpected to self-declare theirexclusion from such entitlement atsubsidised rates and as they getmainstreamed into revenue-generating activities, proportional

subsidy burden is expected todecrease.

To conclude, let this Bill be enactedwith some necessary amendmentsand let its implementation bemonitored in a non-politicised andnon-dogmatic manner. Long-termexpected returns are too high from thissocial and economic investment.


Exhibit-2

From Bill to ActA Brief Overview


Salie

ntFe

atur

esN

atio

nal A

dvis

ory

Cou

ncil�

s D

raft

Nat

iona

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ecur

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ert C

omm

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epor

tN

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nal F

ood

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rity

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, 201

1Pa

rlia

men

tary

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ndin

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omm

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e R

epor

tT

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atio

nal F

ood

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rity

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a, 2

013

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alen

titl

emen

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vera

ge

Food

enti

tlem

ent

Leg

al e

ntit

lem

ent

tosu

bsid

ised

food

gra

ins

shou

ld b

e ex

tend

ed t

o at

leas

t 75

per

cent

of

the

coun

try�

s po

pula

tion

- 90

perc

ent

in r

ural

are

asan

d 50

per

cent

in u

rban

area

s.

The

pri

orit

y ho

useh

olds

shou

ld h

ave

a m

onth

lyen

titl

emen

t of

35k

gs a

t a

subs

idis

ed p

rice

of

Re.

1pe

r kg

for

mill

ets,

Rs

2

The

Exp

ert

Com

mit

tee

reco

mm

ends

tha

t th

een

titl

ed p

opul

atio

n m

aybe

def

ined

as

the

perc

enta

ge o

f pop

ulat

ion

belo

w t

he o

ffic

ial

pove

rty

line

+ 10

per

cent

of t

he B

PL p

opul

atio

n.U

sing

the

Ten

dulk

arpo

vert

y lin

e, t

his

wor

ksou

t to

46

perc

ent

rura

lan

d 28

per

cent

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anpo

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tion

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sepe

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e th

e sa

me

as t

hose

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orit

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ouse

hold

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his

capt

ures

not

onl

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e po

or b

ut a

lso

som

e at

the

mar

gin,

whi

ch is

desi

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e gi

ven

the

obje

ctiv

es o

f th

e N

FSB

.

The

exp

ert

com

mit

tee

argu

ed t

hat

the

NA

C�s

reco

mm

enda

tion

on

the

food

ent

itle

men

t is

flaw

ed s

ince

the

proj

ecte

d fo

odgr

ain

The

ent

itle

men

t of

foo

dgr

ains

at s

ubsi

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d pr

ices

shal

l ext

end

up t

o 75

perc

ent o

f rur

al p

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nan

d 50

per

cent

of

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urba

n po

pula

tion

. Pro

vide

dth

at n

ot le

ss t

han

46pe

rcen

t of

the

rur

al a

nd 2

8pe

rcen

t of

the

urb

anpo

pula

tion

sha

ll be

desi

gnat

ed a

s pr

iori

tyho

useh

olds

.

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ry p

erso

n be

long

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topr

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ty h

ouse

hold

s an

dge

nera

l hou

seho

lds,

sha

llbe

ent

itle

d to

rec

eive

eve

rym

onth

fro

m S

tate

Gov

ernm

ent,

und

er T

PDS,

The

com

mit

tee

agre

ed t

o th

epr

opos

ed c

over

age

of 7

5pe

rcen

t pop

ulat

ion

in r

ural

area

s an

d 50

per

cent

inur

ban

area

s.

Com

mit

tee

furt

her

reco

mm

ende

d th

at t

he s

tate

gove

rnm

ents

may

be

give

nth

e fl

exib

ility

to

exte

nd t

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vera

ge b

eyon

d th

enu

mbe

rs p

resc

ribe

d un

der

the

prop

osed

Bill

out

of

thei

row

n re

sour

ces

so a

s to

cov

erm

ore

popu

lati

on, b

ut n

ot le

sspo

pula

tion

as

envi

sage

d in

the

prop

osed

Bill

.

The

com

mit

tee

was

of

the

view

tha

t es

tim

ated

foo

dre

quir

emen

t at

7kg

per

pers

on p

er m

onth

for

75

perc

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50

perc

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of u

rban

pop

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ld

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com

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vera

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fpr

iori

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nd A

ntyo

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hous

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akin

g �e

ligib

leho

useh

olds

� sha

ll ex

tend

up

to 7

5 pe

rcen

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the

rur

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up

to 5

0pe

rcen

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the

urb

anpo

pula

tion

.

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ry p

erso

n be

long

ing

topr

iori

ty h

ouse

hold

s sh

all b

een

titl

ed t

o re

ceiv

e 5

kg o

ffo

odgr

ains

per

per

son

per

mon

th a

t sub

sidi

sed

pric

esp

ecif

ied

in S

ched

ule

I fr

om


for

whe

at a

nd R

s. 3

for

rice

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gen

eral

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mon

thly

enti

tlem

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of 2

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at

a pr

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not

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g50

per

cent

of

the

curr

ent M

inim

umSu

ppor

t Pri

ce fo

rm

illet

s, w

heat

and

ric

e.

NA

C r

ecom

men

ds t

heen

titl

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7kg

per

capi

ta t

o th

e �p

rior

ity�

hous

ehol

ds (4

6 pe

rcen

tin

rur

al a

nd 2

8% in

urba

n ar

eas)

and

rest

rict

the

gra

inen

titl

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t to

4kg

s pe

rca

pita

for

the

�gen

eral

�ho

useh

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(44%

inru

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nd 2

2% in

urba

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fir

st a

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inal

phas

e as

sug

gest

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yN

AC

?)

avai

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tonn

es a

nd5.

3 m

illio

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nnes

in fi

rst

and

fina

l pha

sere

spec

tive

ly.

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her

the

opti

onfa

vour

ed b

y E

C is

to

rest

rict

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ass

ured

deliv

ery

of f

oodg

rain

s at

Rs

2 pe

r K

g fo

r W

heat

and

Rs

3 Pe

r K

g fo

r R

ice,

to t

he r

eally

nee

dy1

hous

ehol

ds a

nd c

over

the

rest

thr

ough

an

exec

utiv

eor

der

wit

h va

ryin

gqu

antu

m d

epen

ding

on

the

avai

labi

lity

offo

odgr

ains

.

It f

urth

er e

mph

asis

tha

tas

pro

duct

ion

and

proc

urem

ent i

mpr

ove,

the

cove

rage

can

be

incr

ease

d th

roug

hex

ecut

ive

orde

rs.

Mor

eove

r th

e ac

tion

s of

the

gove

rnm

ent

thro

ugh

the

OM

SS (

Ope

n M

arke

tSa

le S

chem

e), w

hen

unde

rtak

en, h

elp

to k

eep

the

mar

ket

pric

es o

ffo

odgr

ains

und

er c

heck

,w

hich

ben

efit

the

non

-en

titl

ed c

ateg

ory.

7 K

g of

foo

dgra

ins

per

pers

on p

er m

onth

for

prio

rity

hou

seho

lds

and

not

less

tha

n 3

Kg

per

pers

on p

er m

onth

for

gene

ral h

ouse

hold

s at

subs

idis

ed p

rice

Subs

idis

ed p

rice

s fo

rPr

iori

ty h

ouse

hold

s sh

all

not

exce

ed R

s 3

per

kg f

orri

ce, R

s 2

per

kg f

orW

heat

, and

Rs

1 pe

r kg

for

mill

ets

coar

se g

rain

s.A

nd f

or g

ener

alho

useh

olds

it s

hall

not

exce

ed 5

0 pe

rcen

t of

the

MSP

for

Whe

at a

ndm

illet

s, a

nd n

ot e

xcee

ding

50 p

erce

nt o

f de

rive

d M

SPfo

r ri

ce.

be b

eyon

d th

e �r

ealm

� of

feas

ibili

ty. S

imila

rly

3kg

per

pers

on p

er m

onth

in n

otad

equa

te f

or s

uste

nanc

e of

ape

rson

. The

refo

re, i

tre

com

men

ded

that

the

popu

lati

on t

o be

cov

ered

unde

r T

PDS

in t

he B

illsh

ould

be

a si

ngle

cat

egor

yw

ith

unif

orm

ent

itle

men

t at

5kg

per

per

son

per

mon

th.

The

com

mit

tee

feel

tha

t th

esu

bsid

ised

pri

ces

cann

ot b

efi

xed

for

all t

imes

to

com

ean

d m

ay n

eed

revi

sion

infu

ture

. The

refo

re, i

tre

com

men

ds t

hat

the

gove

rnm

ent

may

rev

iew

the

pric

es o

f sub

sidi

sed

food

grai

ns e

very

fiv

e ye

ars

and

depe

ndin

g up

on t

hepr

oduc

tion

, pro

cure

men

t,st

ock

posi

tion

etc

. of

food

grai

ns, r

evis

e th

e pr

ices

,if

req

uire

d, s

o th

at t

heam

ount

of

food

sub

sidy

doe

sno

t pu

t he

avy

burd

en o

n th

ena

tion

al e

cono

my.

the

Stat

e G

over

nmen

t un

der

the

Tar

gete

d Pu

blic

Dis

trib

utio

n Sy

stem

.

Prio

rity

hou

seho

lds

are

enti

tled

to

5 kg

of

food

grai

nspe

r pe

rson

per

mon

th, a

ndA

ntyo

daya

hou

seho

lds

to 3

5kg

s pe

r ho

useh

old

per

mon

th.

The

PD

S Is

sue

pric

es a

regi

ven

in S

ched

ule

I: R

s 3/

2/1

per

kg f

or r

ice/

whe

at/m

illet

sre

spec

tive

ly

1.

A

s gi

ven

in t

he le

gal e

ntit

lem

ent

sect

ion

abov

e.


The

EC

sug

gest

in it

sre

port

tha

t th

ego

vern

men

t sh

ould

aim

to e

nsur

e th

at t

he m

arke

tin

gen

eral

func

tion

sbe

tter

.

��

��

��

��

��

Ent

itle

men

tsfo

r W

omen

and

child

ren

1)U

nive

rsal

isat

ion

ofIC

SD (

as p

erSu

prem

e C

ourt

orde

rs);

2)C

ouns

ellin

g an

dsu

ppor

t for

opt

imal

Infa

nt a

nd Y

oung

Chi

ld F

eedi

ng;

3)N

utri

tion

take

-hom

era

tion

s fo

r ch

ildre

nun

der

3 an

dpr

egna

nt/la

ctat

ing

mot

her;

4)C

ooke

d m

idda

ym

eals

up

to C

lass

8in

gov

ernm

ent

and

gove

rnm

ent-

aide

dsc

hool

s;5)

Mat

erni

tyen

titl

emen

ts o

f R

s10

00/-

mon

th f

or 6

mon

ths

for

preg

nant

wom

en.

1)M

eal f

ree

of c

harg

e,du

ring

pre

gnan

cy a

ndsi

x m

onth

s af

ter

the

child

bir

th, t

hrou

gh th

elo

cal a

ngan

wad

i, so

as

to m

eet

the

nutr

itio

nal

stan

dard

s sp

ecif

ied

inth

e B

ill.

2)M

ater

nity

ben

efit

of

Rs

1000

/- p

er m

onth

for

ape

riod

of

six

mon

th in

acco

rdan

ce w

ith

asc

hem

e, in

clud

ing

cost

shar

ing,

pay

able

inin

stal

men

ts a

spr

escr

ibed

by

cent

ral

gove

rnm

ent.

3)O

ne m

id-d

ay m

eal,

free

of c

harg

e in

all

scho

ols

run

by lo

cal b

odie

s,go

vern

men

t an

dgo

vern

men

t ai

ded

scho

ols

up t

o cl

ass

8.4)

Faci

litie

s fo

r ce

ntra

lised

kitc

hen

shal

l be

used

whe

neve

r re

quir

ed a

spe

r th

e gu

idel

ine

issu

edby

cen

tral

gov

ernm

ent.

The

com

mit

tee

reco

mm

ends

that

the

pre

gnan

t w

omen

shou

ld b

e el

igib

le f

or t

hem

ater

nity

ben

efit

of

Rs.

1,0

00pe

r m

onth

aft

er t

hree

mon

ths

into

pre

gnan

cy. I

t fu

rthe

rre

com

men

ds t

hat

the

mat

erni

ty b

enef

it o

f R

s. 1

000/

- sh

all b

e ad

mis

sibl

e up

to

the

birt

h of

sec

ond

child

onl

y in

orde

r to

enc

oura

gest

abili

sati

on o

f pop

ulat

ion.

It a

lso

note

d th

at t

he a

mou

ntof

Rs.

100

0/-

shou

ld b

ein

dica

ted

in t

he S

ched

ule

and

not

in t

he b

ody

of t

he B

ill s

oth

at s

ubse

quen

t re

visi

on in

the

amou

nt w

ould

not

req

uire

amen

dmen

t to

the

Act

.

Due

to

inad

equa

te�a

ngan

wad

i� in

fras

truc

ture

and

serv

ices

the

com

mit

tee

note

d th

at a

s of

now

it c

an�t

be r

elie

d w

ith

the

serv

ices

to

the

preg

nant

wom

enth

eref

ore,

it r

ecom

men

ds t

hat

Eve

ry p

regn

ant

and

lact

atin

gm

othe

r is

ent

itle

d to

a f

ree

mea

l2 a

t th

e lo

cal a

ngan

wad

i(d

urin

g pr

egna

ncy

and

six

mon

ths

afte

r ch

ild b

irth

) as

wel

l as

mat

erni

ty b

enef

it o

fR

s. 6

,000

/- in

suc

hin

stal

men

ts a

s m

ay b

epr

escr

ibed

by

the

Cen

tral

gove

rnm

ent.

For

child

ren

in t

he a

ge g

roup

of 6

mon

ths

to 6

yea

rs, t

heB

ill g

uara

ntee

s an

age

-ap

prop

riat

e m

eal,

free

of

char

ge, t

hrou

gh t

he lo

cal

anga

nwad

i. Fo

r ch

ildre

n ag

ed6-

14 y

ears

, one

fre

e m

id-d

aym

eal s

hall

be p

rovi

ded

ever

yda

y in

all

scho

ols

run

by lo

cal

bodi

es, g

over

nmen

t and

gove

rnm

ent a

ided

-sch

ools

,up

to c

lass

8. F

or c

hild

ren

belo

w s

ix m

onth

s, �

excl

usiv

ebr

east

feed

ing

shal

l be

prom

oted

�.

2.

Not

es: 1

) �M

eal�

is d

efin

ed in

the

Bill

as

�hot

coo

ked

mea

l or

read

y to

eat

mea

l or

take

hom

e ra

tion

, as

may

be

pres

crib

ed b

y th

e C

entr

al G

over

nmen

t�. A

ll �m

eals

� ha

ve t

o m

eet

nutr

itio

nal n

orm

ssp

ecif

ied

in S

ched

ule

II. (

2) T

he e

ntit

lem

ents

of

wom

en a

nd c

hild

ren

are

to b

e de

liver

ed b

y st

ate

gove

rnm

ents

thr

ough

sch

emes

�in

acc

orda

nce

wit

h th

e gu

idel

ines

, inc

ludi

ng c

ost

shar

ing�

to

bepr

escr

ibed

by

the

Cen

tral

Gov

ernm

ent.

(3)

Eve

ry s

choo

l and

ang

anw

adi i

s to

hav

e �f

acili

ties

for

coo

king

mea

ls, d

rink

ing

wat

er a

nd s

anit

atio

n�. (

4) F

or p

urpo

ses

of is

suin

g ra

tion

car

ds, t

he e

ldes

tw

oman

in t

he h

ouse

hold

(no

t le

ss t

han

18 y

ears

of

age)

sha

ll be

con

side

red

head

of

the

hous

ehol

d.


preg

nant

wom

en s

houl

d be

give

n an

add

itio

nal 5

kg o

ffo

odgr

ains

per

mon

th d

urin

gpr

egna

ncy

and

till

two

year

saf

ter

the

child

bir

th s

o as

to

mee

t her

nut

riti

onal

requ

irem

ent,

bot

h po

st-

deliv

ery

and

duri

ng la

ctat

ion.

The

Com

mit

tee

reco

mm

ende

d th

at t

hech

ildre

n be

low

the

age

of

two

year

s w

ho w

ill b

e en

titl

ed t

o5k

g of

foo

dgra

ins

unde

r th

epr

ovis

ions

of

the

Bill

nee

dno

t be

pro

vide

d th

e fr

eem

eals

as

they

will

be

fed

byth

eir

mot

hers

who

hav

eal

read

y be

en r

ecom

men

ded

addi

tion

al 5

kg o

f fo

odgr

ain

till

two

year

s of

the

chi

ldbi

rth

vide

pre

viou

sre

com

men

dati

on.

It f

urth

er r

ecom

men

ded

that

unde

r su

b-cl

ause

5(1

) (b

), a

new

Cla

use

5

(1)(

c )M

ay b

e ad

ded

asun

der:

-

Cla

use

5 (1

) (c

) I

n th

e ca

seof

all

adol

esce

nt g

irls

, age

appr

opri

ate

mea

l in

the

form

of h

ot c

ooke

d m

eals

or

take

-ho

me

rati

ons

as p

er t

henu

trit

iona

l sta

ndar

dsm

enti

oned

in S

ched

ule

II.

Chi

ldre

n w

ho s

uffe

r fr

omm

alnu

trit

ion

will

be

iden

tifi

edth

roug

h th

e lo

cal a

ngan

wad

ian

d m

eals

will

be

prov

ided

to

them

fre

e of

cha

rge

�thr

ough

the

loca

l ang

anw

adi�

.

The

Bill

cal

ls f

ores

tabl

ishm

ent

of t

he f

acili

ties

of c

entr

alis

ed k

itch

ens

inur

ban

area

s fo

r co

okin

g m

eals

and

usin

g th

em w

hene

ver

requ

ired

, as

per

guid

elin

esis

sued

by

the

cent

ral

Gov

ernm

ent.


Spec

ial

grou

ps

Hou

seho

ldco

vera

ge

1)D

aily

, fre

e co

oked

mea

l for

des

titu

tepe

rson

s;2)

Port

able

enti

tlem

ents

for

mig

rant

s;3)

Com

mun

ity

kitc

hens

(sub

ject

tosu

cces

sful

pilo

ts) f

orho

mel

ess

pers

ons

and

urba

n po

or;

4)E

mer

genc

y re

lief

for

disa

ster

-aff

ecte

dpe

rson

s;5)

Unc

ondi

tion

alpr

otec

tion

from

star

vati

on.

��

��

��

��

The

exp

ert

com

mit

tee

sugg

est

that

the

num

ber

of p

eopl

e id

enti

fied

in t

heen

titl

ed c

ateg

ory

is w

ithi

nth

e ce

iling

of

BPL

+10

perc

ent

of B

PL, t

hece

ntra

l gov

ernm

ent

mus

tin

dica

te t

he c

utof

fnu

mbe

rs o

f th

e ru

ral a

ndur

ban

popu

lati

onpe

rcen

tage

s to

the

sta

tes.

The

exp

ert

com

mit

tee

isof

the

opi

nion

tha

t th

ispr

oces

s w

ill e

nsur

e th

atth

e nu

mbe

r of

per

sons

iden

tifi

ed b

y th

e st

ates

as

1.D

aily

, fre

e co

oked

mea

lfo

r de

stit

ute

pers

ons;

2.Po

rtab

le e

ntit

lem

ents

for

mig

rant

s;3.

Com

mun

ity

kitc

hens

(sub

ject

to s

ucce

ssfu

lpi

lots

) for

hom

eles

spe

rson

s an

d ur

ban

poor

;4.

Em

erge

ncy

relie

f fo

rdi

sast

er-a

ffec

ted

pers

ons;

5.U

ncon

diti

onal

prot

ecti

on fr

omst

arva

tion

.

Iden

tifi

cati

on o

f pri

orit

yan

d ge

nera

l hou

seho

lds

isto

be

done

by

the

Stat

eG

over

nmen

ts o

r su

chot

her

agen

cy, i

nac

cord

ance

wit

h gu

idel

ines

for

iden

tifi

cati

onpr

escr

ibed

by

the

Cen

tral

gove

rnm

ent,

pro

vide

d th

atno

hou

seho

ld fa

lling

und

erex

clus

ion

crit

eria

will

be

incl

uded

eit

her

in t

hepr

iori

ty o

r ge

nera

lho

useh

olds

.

The

Bill

itse

lf d

oes

not

spec

ify

the

crit

eria

for

The

com

mit

tee

note

d th

at it

wou

ld b

e di

ffic

ult

for

the

adm

inis

trat

ion

to id

enti

fyde

stit

ute

and

hom

eles

spe

rson

s w

ho m

ay b

e gi

ven

such

ben

efit

s un

der

the

prov

isio

ns o

f the

Bill

.Fu

rthe

r, t

here

is a

ris

k of

brea

king

the

soc

ial f

abri

c as

non-

earn

ing

mem

bers

of

the

fam

ily m

ay b

e pu

shed

out

of

hom

es t

o fe

ed f

orth

emse

lves

.

The

refo

re, c

omm

itte

ere

com

men

ded

incl

usio

n of

this

cat

egor

y of

per

sons

inth

e in

clus

ion

cate

gory

and

clau

se 8

to

be d

elet

ed f

rom

the

Bill

.

The

com

mit

tee

feel

tha

t it

isno

t de

sira

ble

to h

ave

mul

tipl

e ca

tego

ries

as

men

tion

ed in

the

Bill

whi

chis

bou

nd t

o co

mpl

icat

e th

eid

enti

fica

tion

pro

cess

.

The

com

mit

tee

acco

rdin

gly

reco

mm

ende

d th

at t

heG

over

nmen

t m

ay c

onsi

der

devi

sing

cle

arly

def

ined

crit

eria

in c

onsu

ltat

ion

wit

hth

e St

ate

Gov

ernm

ents

for

excl

usio

n of

25

perc

ent

popu

lati

on in

rur

al a

nd

The

cla

use

rela

ting

to

the

�spe

cial

gro

ups

cons

isti

ng o

fal

l des

titu

te p

erso

ns o

rho

mel

ess

pers

ons�

hav

e be

ende

lete

d fr

om t

he N

atio

nal

Food

Sec

urit

y A

ct 2

013.

The

Act

doe

s no

t sp

ecif

ycr

iter

ia f

or t

he id

enti

fica

tion

of h

ouse

hold

s el

igib

le f

or P

DS

enti

tlem

ents

. The

Cen

tral

gove

rnm

ent

is t

o de

term

ine

the

stat

e-w

ise

cove

rage

of

the

PDS.

The

iden

tifi

cati

on o

fel

igib

le h

ouse

hold

s is

left

to

stat

e go

vern

men

ts, s

ubje

ct t

oth

e sc

hem

e �A

ntyo

daya

Ann

yoja

na� g

uide

lines

, and

subj

ect

to g

uide

lines

to

be�s

peci

fied

� by

the

stat

ego

vern

men

t for

pri

orit

yho

useh

olds

.


Ref

orm

s in

PDS

and

TPD

S

The

Bill

em

phas

ise

PDS

refo

rms

to p

lug

leak

ages

and

enh

ance

sac

coun

tabi

lity.

The

seke

y re

form

s ar

ei)

dece

ntra

lised

proc

urem

ent a

ndst

orag

e;ii)

com

mun

ity

man

agem

ent

of P

DS

outl

ets;

iii)

door

step

del

iver

y of

grai

n to

PD

S ou

tlet

s;iv

) r

evis

ion

of P

DS

com

mis

sion

s;

enti

tled

do

not

exce

ed t

hest

ate

wis

e pr

escr

ipti

on a

ndar

e to

tally

wit

hin

the

over

all a

ll In

dia

cove

rage

figu

re o

f 46

per

cent

rur

alan

d 28

per

cent

urb

anpo

pula

tion

. In

othe

rw

ords

the

cen

tral

gove

rnm

ent

will

indi

cate

the

perc

enta

ge o

f th

een

titl

ed p

opul

atio

n, w

hile

the

actu

al id

enti

fica

tion

of

the

bene

fici

arie

s w

ill b

eth

e re

spon

sibi

lity

of t

hest

ates

.

The

Exp

ert

com

mit

tee

feel

s th

at it

will

add

bet

ter

valu

e if

it ju

st d

rew

atte

ntio

n of

the

gove

rnm

ent

to t

wo

inte

rven

tion

s w

hich

can

mak

e th

e m

axim

umim

pact

nam

ely

com

preh

ensi

ve o

f th

e PD

San

d in

trod

ucti

on o

f sm

art

card

s fo

r th

e be

nefi

ciar

ies.

It f

urth

er s

ugge

sted

tha

t as

an a

lter

nati

ve t

o th

eex

isti

ng P

DS

we

may

cate

gori

sati

on o

f th

epo

pula

tion

into

pri

orit

yan

d ge

nera

l hou

seho

ld a

ndal

so d

oes

not

spec

ifie

s as

to

how

the

pri

orit

y an

dge

nera

l hou

seho

lds

will

be

iden

tifi

ed.

The

Cen

tral

and

Sta

tego

vern

men

ts s

hall

ende

avou

r to

pro

gres

sive

lyun

dert

ake

nece

ssar

yre

form

s in

the

TPD

S in

cons

onan

ce w

ith

the

role

envi

sage

d fo

r th

em in

thi

sA

ct:

The

ref

orm

s sh

all i

nclu

de:

i)D

oors

tep

deliv

ery

offo

odgr

ains

to

the

TPD

Sou

tlet

s;ii)

App

licat

ion

ofin

form

atio

n an

dco

mm

unic

atio

n te

chno

logy

50%

pop

ulat

ion

in u

rban

area

s an

d th

e re

st o

f th

epo

pula

tion

i.e.

75

perc

ent

popu

lati

on in

rur

al a

reas

and

50 p

erce

nt in

urb

an a

reas

shou

ld u

nifo

rmly

get

enti

tlem

ents

wit

hout

dist

inct

ion.

The

com

mit

tee

stro

ngly

urg

eth

at C

entr

al G

over

nmen

t to

take

spe

cial

car

e in

coor

dina

tion

wit

h th

e St

ate

Gov

ernm

ent

in t

heid

enti

fica

tion

of h

ouse

hold

sfo

r en

titl

emen

t un

der

TPD

Sun

der

the

NFS

B a

nd e

nsur

eth

at d

eser

ving

per

sons

may

not

get

excl

uded

fro

m t

heco

vera

ge o

f Pu

blic

Dis

trib

utio

n Sy

stem

and

othe

r so

cial

wel

fare

sch

emes

.

Com

mit

tee

desi

re t

he C

entr

algo

vern

men

t to

pres

crib

em

inim

um q

ualit

y st

anda

rdno

rms

for

the

food

grai

ns a

ndsh

ould

be

inse

rted

in c

laus

e18

(2)

of

the

Bill

.1.

The

com

mit

tee

reco

mm

ende

d th

at C

laus

e18

(2)(

a) m

ay b

e re

plac

edas

und

er:

�Doo

rste

p de

liver

y of

fort

ifie

d fo

odgr

ains

/fo

rtif

ied

atta

/pul

ses/

suga

r/m

iller

s an

d ot

her

nutr

igra

ins

(coa

rse

grai

ns)

The

iden

tifi

cati

on o

f elig

ible

hous

ehol

ds is

to b

e co

mpl

eted

wit

hin

365

days

. The

list

s of

elig

ible

hou

seho

lds

are

to b

epl

aced

in t

he p

ublic

dom

ain

and

�dis

play

ed p

rom

inen

tly�

.

The

Cen

tral

and

Sta

tego

vern

men

ts s

hall

ende

avou

rto

pro

gres

sive

ly u

nder

take

nece

ssar

y re

form

s in

the

TPD

S in

con

sona

nce

wit

h th

ero

le e

nvis

aged

for

the

m in

thi

sA

ct:

The

ref

orm

s sh

all i

nclu

de:

i)D

oors

tep

deliv

ery

offo

odgr

ains

to

the

TPD

Sou

tlet

s;ii)

App

licat

ion

of in

form

atio

nan

d co

mm

unic

atio

nte

chno

logy

tool

s in

clud

ing

end-

to-e

nd c

ompu

teri

sati

on in


v)A

pplic

atio

n of

Info

rmat

ion,

Com

mun

icat

ion

Tec

hnol

ogy

(IC

T)

incl

udin

g en

d-to

-end

com

pute

risa

tion

of t

hePD

Svi

)fu

ll tr

ansp

aren

cy o

fre

cord

s an

d so

cial

aud

itet

c.It

has

to

be n

oted

tha

tth

e PD

S en

titl

emen

tsar

e no

t to

be

redu

ced

inan

y m

anne

r ub

till

atle

ast

the

end

of t

he 1

2th

FYP

peri

od. O

ther

enti

tlem

ents

can

not

bere

duce

d by

am

endm

ent

of t

he A

ct.

swit

ch o

ver

to t

he u

se o

fsm

art

card

s w

hich

sim

ply

mea

ns t

hat

the

food

subs

idy

may

be

dire

ctly

tran

sfer

red

to t

hebe

nefi

ciar

ies

inst

ead

of t

oth

e ow

ners

of

PDS

stor

es.

The

intr

oduc

tion

of t

hesm

art

card

sys

tem

desc

ribe

d ab

ove

can

be in

two

stag

es:

1.In

the

fir

st s

tage

,ke

epin

g th

e cu

rren

tm

etho

d of

foo

dgra

inal

loca

tion

to

the

FPS

unch

ange

d w

e ca

nin

trod

uce

smar

t car

dsfo

r th

e be

nefi

ciar

ies

only

.2.

Dep

endi

ng o

n th

esu

cces

s of

the

fir

stst

age

the

sche

me

can

be e

xten

ded

to n

onPD

S re

tail

shop

s in

the

seco

nd s

tage

. A p

ilot

ofth

e st

age

2 ca

n be

intr

oduc

ed e

ven

now

in a

few

met

ropo

litan

area

s w

hich

is li

kely

to

have

a la

rge

netw

ork

of r

etai

l sho

ps.

tool

s in

clud

ing

end-

to-e

ndco

mpu

teri

sati

on in

ord

er to

ensu

re tr

ansp

aren

tre

cord

ing

of t

rans

acti

on a

tal

l lev

els,

and

pre

vent

dive

rsio

n;iii

)L

ever

agin

g �a

adha

ar�

for

uniq

ue id

enti

fica

tion

,w

ith

biom

etri

c in

form

atio

nof

ent

itle

d be

nefi

ciar

ies

for

prop

er t

arge

ting

of

bene

fits

unde

r th

is A

ct;

iv)

Full

tran

spar

ency

of

reco

rds;

v)Pr

efer

ence

to p

ublic

inst

itut

ions

or

publ

ic b

odie

ssu

ch a

s Pa

ncha

yats

, sel

f-he

lp g

roup

s, c

o-op

erat

ives

,in

lice

nsin

g of

fai

r pr

ice

shop

s an

d m

anag

emen

t of

fair

pri

ce s

hops

by

wom

enor

thei

r co

llect

ives

;vi

)D

iver

sifi

cati

on o

fco

mm

odit

ies

dist

ribu

ted

unde

r PD

S ov

er a

per

iod

ofti

me;

vii)

Supp

ort

to lo

cal p

ublic

dist

ribu

tion

mod

els

and

grai

n ba

nks;

Intr

oduc

ing

sche

mes

, suc

has

, cas

h tr

ansf

er, f

ood

coup

ons,

or

othe

r sc

hem

es,

to t

he t

arge

ted

bene

fici

arie

sin

ord

er t

o en

sure

the

irfo

odgr

ain

enti

tlem

ents

spec

ifie

d in

the

Act

, in

such

area

and

man

ner

to t

he T

PDS

outl

ets�

.2.

As

per

prov

isio

nsco

ntai

ned

in t

he C

laus

e18

(2) �

appl

icat

ion

ofin

form

atio

n an

dco

mm

unic

atio

nte

chno

logy

..�. t

heco

mm

itte

e re

com

men

dsth

e fo

llow

ing:

a)C

CT

V c

amer

as s

houl

d be

inst

alle

d in

the

sto

rage

godo

wns

of

whe

at, r

ice

suga

r et

c.b)

All

the

stor

age

poin

tssh

ould

be

conn

ecte

d w

ith

inte

rnet

sys

tem

inst

alle

d at

the

dist

rict

HQ

.c)

The

dis

trib

utio

n of

PD

Sco

mm

odit

ies

shou

ld b

em

ade

thro

ugh

com

pute

rge

nera

ted

bills

whi

chsh

ould

con

nect

wit

h th

ere

spec

tive

sta

tes

HQ

.d)

Gov

ernm

ent s

houl

dco

nsid

er in

stal

ling

GPS

devi

ces

in v

ehic

les

carr

ying

food

grai

ns.

e)W

ith

resp

ect

to t

hesc

hem

es li

ke D

irec

t ca

shtr

ansf

er, t

he c

omm

itte

ere

com

men

ds t

hat

the

gove

rnm

ent s

houl

d en

sure

that

ban

king

infr

astr

uctu

re a

ndac

cess

ibili

ty to

ban

king

faci

lity

are

mad

e av

aila

ble

in a

ll pa

rts

of t

he c

ount

ryin

clud

ing

rem

ote,

rur

al

orde

r to

ens

ure

tran

spar

ent

reco

rdin

g of

tra

nsac

tion

at

all

leve

ls, a

nd p

reve

nt d

iver

sion

;iii

)L

ever

agin

g �a

adha

ar� f

orun

ique

iden

tifi

cati

on, w

ith

biom

etri

c in

form

atio

n of

enti

tled

ben

efic

iari

es fo

rpr

oper

tar

geti

ng o

f be

nefi

tsun

der

this

Act

;iv

)Fu

ll tr

ansp

aren

cy o

fre

cord

s;v)

Pref

eren

ce to

pub

licin

stit

utio

ns o

r pu

blic

bod

ies

such

as

Panc

haya

ts, s

elf-

help

grou

ps, c

o-op

erat

ives

, in

licen

sing

of

fair

pri

ce s

hops

and

man

agem

ent

of f

air

pric

esh

ops

by w

omen

or

thei

rco

llect

ives

;vi

)D

iver

sifi

cati

on o

fco

mm

odit

ies

dist

ribu

ted

unde

rPD

S ov

er a

per

iod

of t

ime;

vii)

Supp

ort

to lo

cal p

ublic

dist

ribu

tion

mod

els

and

grai

nba

nks;

viii)

Intr

oduc

ing

sche

mes

,su

ch a

s, c

ash

tran

sfer

, foo

dco

upon

s, o

r ot

her

sche

mes

, to

the

targ

eted

ben

efic

iari

es in

orde

r to

ens

ure

thei

rfo

odgr

ain

enti

tlem

ents

spec

ifie

d in

the

Act

, in

such

area

and

man

ner.

It is

to

be n

oted

tha

t th

e th

ecl

ause

rel

aing

to

the

�ref

orm

sin

the

TPD

S� in

Nat

iona

l Foo

dSe

curi

ty A

ct 2

013,

has

bee

nun

chan

ged

from

the

NFS

B


Ess

enti

alPr

ovis

ions

To

ensu

re t

hat

food

enti

tlem

ents

are

real

ised

, gri

evan

cere

dres

sal p

rovi

sion

sin

clud

e:1.

Stri

ct t

rans

pare

ncy

stan

dard

s fo

r al

lfo

od-r

elat

edsc

hem

es.

2.Sw

ift

fine

s fo

r an

yvi

olat

ion

of t

he A

ct.

3.�D

uty

to f

ine�

whe

neve

r

��

�T

he B

ill s

tate

s th

at t

heC

entr

al G

over

nmen

t an

dth

e St

ate

Gov

ernm

ent

shal

lpu

t in

pla

ce a

n in

tern

algr

ieva

nce

redr

essa

lm

echa

nism

whi

ch m

ayin

clud

e ca

ll ce

ntre

s, h

elp

lines

, des

igna

tion

of

the

noda

l off

icer

s, o

r su

chot

her

mec

hani

sm a

s m

aybe

pre

scri

bed

by t

here

spec

tive

Gov

ernm

ents

.

and

hilly

tri

bal a

reas

befo

re in

trod

ucin

g ca

shtr

ansf

er in

lieu

of

food

subs

idy.

The

com

mit

tee,

furt

her,

note

d th

at t

he F

PS d

eale

rsw

ho p

lay

a ke

y ro

le in

the

dist

ribu

tion

of f

oodg

rain

sri

ghtf

ully

des

erve

to

bepr

ovid

ed a

rea

sona

ble

mar

gin

for

thei

rsu

stai

nabi

lity

and

viab

ility

.

Bes

ides

thi

s, t

he c

omm

itte

ere

com

men

ds t

he g

over

nmen

tto

impr

ess

upon

the

sta

tego

vern

men

ts/ U

TS

that

besi

des

cons

ider

ing

suit

able

incr

ease

in th

e co

mm

issi

on,

to a

lso

allo

w t

he F

PS li

cens

esto

enl

arge

the

bas

ket

ofco

mm

odit

ies

for

sale

in o

rder

to e

nhan

ce t

heir

via

bilit

y.

On

the

prov

isio

ns o

f th

eex

pend

itur

e in

curr

ed b

y th

est

ate

gove

rnm

ents

, the

y ha

vesh

own

thei

r di

scon

tent

, thu

s,th

e co

mm

itte

e de

sire

d th

atth

e D

epar

tmen

t sho

uld

disc

uss

the

mat

ter

wit

h al

lth

e St

ate

Gov

ernm

ents

/ UT

adm

inis

trat

ions

and

find

out

an a

mic

able

sol

utio

n w

ith

rega

rd t

o sh

arin

g of

expe

ndit

ure

on e

stab

lishm

ent

2011

, i.e

; it

doe

s no

t re

flec

tan

y ch

ange

s or

reco

mm

enda

tion

from

the

Parl

iam

enta

ry c

omm

itte

ere

port

.

The

Bill

pro

vide

s fo

r a

two-

tier

gri

evan

ce r

edre

ssal

stru

ctur

e, in

volv

ing

the

Dis

tric

t Gri

evan

ce R

edre

ssal

Off

icer

(D

GR

O)

and

Stat

eFo

od C

omm

issi

on. S

tate

gove

rnm

ents

mus

t al

so p

ut in

plac

e an

inte

rnal

gri

evan

cere

dres

sal m

echa

nism

whi

chm

ay in

clud

e ca

ll ce

ntre

s, h

elp

lines

, des

igna

tion

of n

odal

offi

cers

, �or

suc

h ot

her

mec

hani

sms

as m

ay b

e


Inst

itut

iona

lSe

tup

irre

gula

riti

es a

refo

und.

4.Pr

inci

ple

of�v

icar

ious

resp

onsi

bilit

y�5.

Com

pens

atio

n in

the

even

t of

any

loss

of

enti

tlem

ent.

All

food

-rel

ated

sche

mes

will

com

eun

der

a co

mm

ongr

ieva

nce

redr

essa

lfr

amew

ork,

invo

lvin

g;1.

Blo

ck-l

evel

faci

litat

ion

cent

res;

2.D

istr

ict G

riev

ance

Red

ress

al O

ffic

ers;

3.St

ate-

and

nati

onal

-le

vel F

ood

and

Nut

riti

onC

omm

issi

ons

��

��

��

The

Bill

pro

pose

s to

appo

int D

istr

ict G

riev

ance

Red

ress

al O

ffic

er, f

orex

pedi

tiou

s an

d ef

fect

ive

redr

essa

l of

grie

vanc

es o

fth

e ag

grie

ved

pers

ons

inm

atte

rs r

elat

ing

todi

stri

buti

on o

f ent

itle

dfo

odgr

ains

und

er v

ario

uspr

ovis

ions

of t

he B

ill.

The

Bill

als

o pr

opos

es t

hat

the

Stat

e G

over

nmen

t sh

all

prov

ide

for

the

sala

ry a

ndal

low

ance

s of

the

Dis

tric

tG

riev

ance

Red

ress

alO

ffic

er a

nd o

ther

sta

ffap

poin

ted,

and

suc

h ot

her

expe

ndit

ure

as m

ay b

eco

nsid

ered

nec

essa

ry fo

rth

eir

appr

opri

ate

func

tion

ing.

The

Bill

per

tain

s to

com

posi

tion

of

the

Stat

eC

omm

issi

on w

hich

con

sist

sof

a C

hair

pers

on, f

ive

othe

r M

embe

rs a

nd a

Mem

ber-

Secr

etar

y w

hosh

all b

e ap

poin

ted

from

amon

gst

serv

ices

and

peop

le h

avin

g kn

owle

dge

and

expe

rien

ce in

mat

ters

rela

ting

to

Food

Sec

urit

y,po

licy

mak

ing

and

adm

inis

trat

ion

in t

he f

ield

of a

gric

ultu

re, c

ivil

of r

edre

ssal

mec

hani

sm in

the

stat

es.

In a

ddit

ion

to t

his,

the

com

mit

tee

reco

mm

ende

d th

atth

e B

ill s

houl

d ha

ve p

rovi

sion

for

grie

vanc

e re

dres

s at

Blo

ck/

Vill

age

Panc

haya

t le

vel a

lso

wit

h el

ecte

d w

omen

repr

esen

tati

ves

for

easy

acc

ess

of t

he p

eopl

e liv

ing

in v

illag

ean

d re

mot

e ar

eas.

Fur

ther

, it

adds

on

stat

ing,

ade

quat

ere

pres

enta

tion

of

Panc

haya

tm

embe

rs is

als

o de

sira

ble

inth

e D

istr

ict P

lann

ing

Com

mit

tees

wit

h a

view

to

ensu

ring

peo

ple

run

and

peop

le o

rien

ted

grie

vanc

ere

dres

sal m

echa

nism

.

The

com

mit

tee

desi

re t

hat

the

Stat

e Fo

od C

omm

issi

onsh

ould

hav

e at

leas

t on

ere

pres

enta

tive

fro

m t

hefa

rmer

�s c

omm

unit

y,co

nsid

erin

g th

e vi

ews/

sugg

esti

ons

rece

ived

and

als

oth

e fa

ct t

hat

a la

rge

perc

enta

ge o

f ou

r po

pula

tion

cons

titu

tes

farm

ers

who

are

both

pro

duce

rs a

s w

ell a

sco

nsum

ers.

The

gov

ernm

ent

may

con

side

r am

endi

ng t

here

leva

nt p

rovi

sion

s of

the

Bill

acco

rdin

gly.

pres

crib

ed�.

Not

e: T

he N

atio

nal F

ood

Secu

rity

Act

201

3, d

oes

not

refl

ect

the

reco

mm

enda

tion

of

the

Parl

iam

enta

ry c

omm

itte

eon

the

est

ablis

hmen

t of

the

Blo

ck/ V

illag

e Pa

ncha

yat

leve

lgr

ieva

nce

redr

essa

l bod

ies.

The

cha

nge

refl

ecte

d in

the

Act

fro

m t

he B

ill I

s th

at, B

illpr

opos

es th

e C

entr

alG

over

nmen

t an

d St

ate

Gov

ernm

ent

to p

ut in

pla

ce a

nin

tern

al g

riev

ance

red

ress

alm

echa

njsm

, (cl

ause

20)

Whe

rein

the

fin

al A

ct, i

t pr

opos

es t

oal

l the

Sta

te G

over

nmen

ts t

opu

t in

pla

ce a

n in

tern

algr

ieva

nce

redr

essa

lm

echa

nism

. (C

laus

e 14

)

The

Bill

pro

vide

s fo

r th

ecr

eati

on o

f St

ate

Food

Com

mis

sion

s. E

ach

Com

mis

sion

sha

ll co

nsis

t of

ach

airp

erso

n, fi

ve o

ther

mem

bers

and

a m

embe

r-se

cret

ary

(inc

ludi

ng a

t le

ast

two

wom

en a

nd o

ne m

embe

rea

ch f

rom

Sch

edul

ed C

aste

san

d Sc

hedu

led

Tri

bes)

.

The

Act

pro

vide

s fo

r th

ecr

eati

on o

f St

ate

Food

Com

mis

sion

s. T

he m

ain

func

tion

of

the

Stat

e


Food

Proc

urem

ent

NA

C e

stim

ated

the

enti

tled

foo

d gr

ain

requ

irem

ent

(PD

S) f

orPh

ase

1 at

49.

36m

illio

n to

nnes

and

for

fina

l pha

se a

t 55

.59

Scen

ario

1: B

ased

on

the

two

assu

mpt

ions

of

the

food

grai

n of

ftak

e by

AA

Y a

nd B

PL h

ouse

hold

san

d fo

r ye

ar o

fim

plem

enta

tion

s i.e

.;

supp

lies,

nut

riti

on, h

ealt

hor

any

alli

ed f

ield

.

The

Bill

pro

pose

s th

atth

ere

shal

l be

one

pers

onbe

long

ing

to t

he S

ched

uled

Cas

tes

and

one

pers

onbe

long

ing

to t

he S

ched

uled

Tri

bes,

whe

ther

Cha

irm

an,

Mem

ber

or M

embe

r-Se

cret

ary.

It a

lso

prov

ides

tha

t th

elo

cal a

utho

riti

es s

hall

bere

spon

sibl

e fo

r th

e pr

oper

impl

emen

tati

on o

f th

is A

ctin

the

ir r

espe

ctiv

e ar

eas.

Exc

ludi

ng th

ere

quir

emen

ts fo

r B

uffe

ran

d O

pen

Mar

ket

Sale

sSc

hem

e (O

MSS

), t

otal

requ

irem

ent o

f foo

dgra

ins,

as p

er t

he B

ill w

ould

be

The

com

mit

tee

find

tha

t th

ete

rm �L

ocal

aut

hori

ty� i

sva

gue

and

may

be

repl

aced

by �L

ocal

inst

itut

ions

of

self

-go

vern

men

t�. F

urth

er, r

ole

and

resp

onsi

bilit

ies

of lo

cal

auth

orit

ies

have

not

bee

ncl

earl

y sp

elt

out

in t

he B

ill.

The

com

mit

tee

desi

re t

hat

ade

taile

d lis

t ill

ustr

atin

g th

efu

ncti

ons

to b

e de

volv

ed t

oth

e el

ecte

d lo

cal b

odie

s un

der

the

Nat

iona

l Foo

d se

curi

tyB

ill, b

oth

in r

ural

and

urb

anar

eas

may

be

anne

xed

to t

heB

ill.

The

Com

mit

tee

furt

her

reco

mm

ende

d th

at in

Cla

use

34 o

f th

e B

ill t

he f

ollo

win

gse

nten

ce m

ay b

e ad

ded

afte

rth

e ex

isti

ng s

ente

nce:

�the

stat

e go

vern

men

t sh

all m

ake

avai

labl

e th

e re

quir

ed f

unds

and

func

tion

arie

s to

the

inst

itut

ions

of l

ocal

sel

f-go

vern

men

t to

ena

ble

them

to p

erfo

rm t

here

spon

sibi

litie

s ve

sted

inth

em u

nder

the

Act

.

The

food

pro

cure

men

tre

ache

d 73

.2 M

Ts

in 2

011-

12 w

hich

is a

bout

37

perc

ent

of t

he p

rodu

ctio

n. A

s su

ch,

the

curr

ent

leve

l of

proc

urem

ent

at 3

7 pe

rcen

t of

Com

mis

sion

is t

o m

onit

or t

heim

plem

enta

tion

of

the

Act

,gi

ve a

dvic

e to

the

sta

tego

vern

men

ts a

nd t

heir

agen

cies

, and

inqu

ire

into

viol

atio

ns o

f ent

itle

men

ts.

Stat

e co

mm

issi

ons

also

hav

eto

hea

r ap

peal

s ag

ains

t or

ders

of t

he D

istr

ict

Gri

evan

ceR

edre

ssal

Off

icer

and

pre

pare

annu

al r

epor

ts.

Not

e: t

he r

ecom

men

dati

on o

nth

e in

clus

ion

of t

he s

ente

nce

in t

he C

laus

e re

lati

ng t

o th

eim

plem

enta

tion

of

the

Act

thro

ugh

the

loca

l aut

hori

ties

,an

d ad

ding

the

sen

tenc

e on

assu

ring

fina

ncia

l ass

ista

nce

by t

he s

tate

gov

ernm

ent,

has

not

been

tak

en in

to a

ccou

nt in

the

fina

l cop

y of

the

NFS

, Act

2013

.

��

��

��

�


Ena

blin

gPr

ovis

ions

mill

ion

tonn

es.

Popu

lati

on p

roje

ctio

nsus

ed a

re f

or y

ear

2010

for

both

the

pha

ses.

It c

all o

n th

e ce

ntra

l,st

ate

and

loca

lgo

vern

men

ts t

o st

rive

tow

ards

pro

gres

sive

real

isat

ion

of (i

nter

alia

):(1

) re

vita

lisat

ion

ofag

ricu

ltur

e an

d fo

od

2011

for

fir

st p

hase

and

2013

for

fin

al p

hase

. The

enti

tled

food

grai

nre

quir

emen

t (P

DS)

for

phas

e 1

wor

ks o

ut t

o54

.04

mill

ion

tonn

es a

ndfo

r th

e fi

nal p

hase

to

58.5

8 m

illio

n to

nnes

.

Scen

ario

2: C

urre

nt is

sue

pric

es a

re h

ighe

r th

anw

hat

is p

ropo

sed

in N

FSB

thus

, im

plem

enta

tion

of

this

bill

is li

kely

to

incr

ease

the

cons

umpt

ion.

On

this

bas

is t

hefo

odgr

ain

requ

irem

ent f

orth

e tw

o ph

ases

wor

ks o

utto

be

58.7

6 m

illio

n to

nnes

and

63.9

8 m

illio

n to

nnes

.

Scen

ario

3: I

f w

e ad

dfo

odgr

ain

requ

irem

ent f

orot

her

wel

fare

sch

emes

and

for

mai

ntai

n th

e bu

ffer

stoc

k it

wor

ks o

ut t

o be

68.7

6 m

illio

n to

nnes

for

phas

e 1

and

73.9

8 m

illio

nto

nnes

for

pha

se 2

.

��

�-

61.5

5 m

illio

n to

ns in

201

2-13

.

Tho

ugh

the

Lon

g te

rmtr

end

in p

rocu

rem

ent

has

been

low

er, t

he a

vera

gean

nual

pro

cure

men

t as

perc

enta

ge o

f pro

duct

ion

duri

ng 2

006-

10 h

as b

een

abov

e 30

per

cent

.

The

Bill

div

ides

the

oblig

atio

ns o

f th

e C

entr

alG

over

nmen

t an

d th

e St

ate

Gov

ernm

ent f

or F

ood

secu

rity

, int

o C

hapt

er 1

0an

d 11

res

pect

ivel

y.

Whe

re t

he C

entr

al

prod

ucti

on o

f w

heat

and

ric

e,it

wou

ld b

e po

ssib

le t

o m

eet

the

food

grai

ns r

equi

rem

ent

unde

r th

e N

atio

nal F

ood

Secu

rity

Bill

, it

also

impl

ies

that

the

ave

rage

ann

ual

proc

urem

ent

leve

l will

hav

eto

be

sust

aine

d in

ord

er t

om

eet

the

food

gra

ins

requ

irem

ent

in t

he y

ears

to

com

e.

Furt

her,

the

com

mit

tee

note

dth

at f

or r

evit

alis

atio

n of

agri

cult

ure,

the

pla

nal

loca

tion

for

agri

cult

ure

shou

ld b

e in

com

men

sura

tion

wit

h th

e fu

ture

req

uire

men

ts.

For

the

effe

ctiv

eim

plem

enta

tion

for

the

nati

onal

foo

d se

curi

ty B

ill,

the

com

mit

tee

note

s th

at t

here

spec

tive

dep

artm

ents

of

the

Stat

es/U

Ts

shou

ld c

onsu

lt th

eFi

nanc

e C

omm

issi

on w

ith

rega

rd t

o th

e ad

diti

onal

The

Nat

iona

l Foo

d Se

curi

tyA

ct, n

oted

an

addi

tion

of

the

Sub-

clau

se 2

2 (4

) (d

) w

hich

urge

s C

entr

al g

over

nmen

t to

prov

ide

assi

stan

ce t

o th

e St

ate

Gov

ernm

ent

in m

eeti

ng t

heex

pend

itur

e in

curr

ed b

y it

tow

ards

intr

a-St

ate


mov

emen

t, h

andl

ing

offo

odgr

ains

and

mar

gins

pai

dto

fai

r pr

ice

shop

dea

lers

, in

acco

rdan

ce w

ith

such

nor

ms

and

man

ner

as m

ay b

epr

escr

ibed

by

the

Cen

tral

gove

rnm

ent.

Not

e: in

the

Act

, the

clau

se(3

0)(3

) re

lati

ng t

o th

ean

nual

rev

isio

n of

the

allo

cati

on o

f th

e fo

odgr

ains

,in

the

pre

scri

bed

man

ner

base

d on

the

act

ual o

res

tim

ated

pop

ulat

ion

has

been

rem

oved

.

In c

ue o

f th

e re

com

men

dati

onby

the

par

liam

enta

ryco

mm

itte

e on

the

cla

use

40 o

fth

e bi

ll, t

he f

inal

Act

ref

lect

sth

e ad

diti

on o

f a

sub-

clau

se32

(2)

as u

nder

:�N

otw

iths

tand

ing

anyt

hing

cont

aine

d in

thi

s A

ct, t

heSt

ate

Gov

ernm

ent

may

cont

inue

wit

h or

for

mul

ate

food

or

nutr

itio

n ba

sed

plan

sor

sch

emes

pro

vidi

ng f

orbe

nefi

ts h

ighe

r th

an t

hebe

nefi

ts p

rovi

de u

nder

this

Act

, fro

m it

s ow

n re

sour

ces.

expe

ndit

ure

requ

ired

to b

ebo

rne

by t

he r

espe

ctiv

ead

min

istr

atio

ns s

o th

at t

hey

may

allo

cate

suf

fici

ent

fund

sin

the

ir r

espe

ctiv

e B

udge

ts f

orth

e im

plem

enta

tion

for

the

Fina

l act

.

The

com

mit

tee

note

d th

at in

Dec

entr

alis

ed P

rocu

rem

ent

Stat

es (

DC

P), o

blig

atio

n of

the

Cen

tral

and

Sta

teG

over

nmen

ts s

omet

imes

over

lap.

The

Com

mit

tee

reco

mm

ends

that

the

Cen

tral

Dep

artm

ent

shou

ld im

pres

s up

on a

llSt

ates

/UT

adm

inis

trat

ions

tom

ake

ever

y po

ssib

le e

ffor

t to

crea

te s

cien

tifi

c St

orag

efa

cilit

ies

up t

o B

lock

Lev

els

by t

akin

g ad

vant

age

of t

hePr

ivat

e E

ntre

pren

eurs

Gua

rant

ee (

PEG

) Sc

hem

e. I

nth

is r

egar

d, it

fur

ther

reco

mm

ends

tha

t th

e C

entr

algo

vern

men

t m

ay p

rovi

defi

nanc

ial a

ssis

tanc

e to

the

Stat

es/U

TS

for

crea

tion

of

mod

ern

scie

ntif

ic s

tora

gefa

cilit

ies.

As

prep

ared

ness

toim

plem

ent

the

Act

sho

uld

prov

ide

for

allo

win

g St

ates

/U

Ts,

a r

easo

nabl

e ti

me

limit

,w

hich

cou

ld b

e on

e ye

ar,

Gov

ernm

ent

is li

able

to:

proc

ure

food

grai

ns f

or t

hece

ntra

l poo

l thr

ough

its

own

agen

cies

and

the

Sta

tego

vern

men

ts a

nd t

heir

agen

cies

, allo

cate

the

proc

ured

foo

dgra

in t

o th

est

ates

, als

o pr

ovid

es f

or t

hetr

ansp

orta

tion

of

food

grai

ns. I

n ad

diti

on t

oth

is, t

he B

ill p

ropo

ses

for

the

crea

tion

and

mai

nten

ance

of r

equi

red

mod

ern

and

scie

ntif

icst

orag

e fa

cilit

ies

at v

ario

usle

vels

.

In a

ddit

ion

to t

heim

plem

enta

tion

rol

e of

the

cent

ral g

over

nmen

t th

e B

illal

so u

rges

the

Sta

tego

vern

men

t, a

s th

eir

Dut

yun

der

TPD

S, t

o ta

kede

liver

y of

foo

dgra

ins

from

the

desi

gnat

ed d

epot

s of

the

cent

ral g

over

nmen

t,or

gani

se in

tra0

stat

eal

loca

tion

for

del

iver

y of

the

allo

cate

d fo

odgr

ains

thro

ugh

thei

r au

thor

ised

agen

cies

at

the

door

ste

p of

FPS,

als

o to

ens

ure

actu

alde

liver

y of

the

foo

dgra

ins

to e

ntit

led

pers

ons

at t

hepr

ices

spe

cifi

ed in

the

Bill

.

The

Bill

per

tain

s to

the

prov

isio

n th

at, t

his

Act

prod

ucti

on;

(2)

univ

ersa

l acc

ess

tosa

fe d

rink

ing

wat

eran

d sa

nita

tion

;(3

) un

iver

sal h

ealt

hca

re;

(4)

univ

ersa

l acc

ess

tocr

èche

faci

litie

s;(5

) spe

cial

nut

riti

onsu

ppor

t for

per

sons

wit

h st

igm

atis

edan

d de

bilit

atin

gai

lmen

ts;

(6) P

rovi

sion

of

pens

ions

for

the

aged

, dis

able

d, a

ndsi

ngle

wom

en.


wit

hin

whi

ch t

hey

will

be

requ

ired

to

com

plet

e th

epr

epar

ator

y w

ork,

at

the

end

of w

hich

the

Act

will

com

ein

to f

orce

in a

ll St

ates

.

If a

ny S

tate

/UT

is in

apo

siti

on to

impl

emen

t the

AC

T e

arlie

r th

an t

hest

ipul

ated

tim

e, t

hey

can

doso

.

The

com

mit

tee

aske

d fo

rde

tails

as

to t

he c

ours

e of

acti

on t

o be

fol

low

ed a

ndti

me

sche

dule

wit

hin

whi

chal

l the

pro

visi

ons

will

be

done

.

The

com

mit

tee

furt

her,

des

ire

that

the

Gov

ernm

ent

shou

ldco

nsid

er a

men

ding

the

follo

win

g pr

ovis

ion

inSc

hedu

le I

II o

f th

e B

ill:

1)(c

) m

ay b

e m

odif

ied

as�e

nsur

ing

livel

ihoo

d se

curi

tyto

far

mer

s by

way

of

rem

uner

ativ

e pr

ices

, acc

ess

toin

puts

, cre

dit,

irri

gati

on,

pow

er, c

rop

insu

ranc

e, e

tc.�

.

The

com

mit

tee

reco

mm

ende

dto

mod

ify

the

clau

se (

40)

unde

r th

e B

ill a

s: �N

eces

sary

chan

ges

shou

ld b

e m

ade

inpr

ovis

ion

of t

he B

ill b

ased

on

the

impa

ct a

sses

smen

tsre

gard

ing

chan

ge in

hea

lth

shal

l not

pre

clud

e th

eC

entr

al g

over

nmen

t or

the

Stat

e G

over

nmen

ts f

rom

cont

inui

ng o

r fo

rmul

atin

got

her

food

bas

ed w

elfa

resc

hem

es.


Tra

nspa

renc

yan

dac

coun

tabi

lity

All

food

-rel

ated

sche

mes

will

hav

e to

mee

t co

mm

onst

anda

rds

oftr

ansp

aren

cy. T

hese

incl

ude:

1.A

ll in

form

atio

n in

the

publ

ic d

omai

n;2.

Pro-

acti

vedi

sclo

sure

of

esse

ntia

lin

form

atio

n;3.

Web

-bas

ed M

ISw

ith

conv

ersi

on to

Jana

ta I

nfor

mat

ion

Syst

em a

t th

evi

llage

leve

l;4.

Ope

n of

fice

, ope

nin

spec

tion

, ope

nre

cord

s� r

egim

e;5.

Man

dato

ry s

ocia

lau

dits

;6.

Man

dato

rypr

ovis

ion

ofin

divi

dual

tran

sact

ion

reco

rds

to a

ll be

nefi

ciar

ies

RT

I w

ithi

n 15

day

s at

no m

ore

than

phot

ocop

ying

cos

t. A

tle

ast

1% o

f th

e co

st o

ffo

od-r

elat

ed s

chem

es

��

��

��

��

��

�T

he B

ill i

nclu

des

the

man

dato

ry t

rans

pare

ncy

prov

isio

ns w

hich

incl

udes

:1.

Plac

ing

all T

PDS-

rela

ted

reco

rds

in t

hepu

blic

dom

ain

and

keep

ing

them

ope

n fo

rin

spec

tion

to th

epu

blic

;2.

Con

duct

ing

peri

odic

soci

al a

udit

s of

the

PD

San

d ot

her

wel

fare

sche

mes

;3.

Usi

ng in

form

atio

n an

dco

mm

unic

atio

nte

chno

logy

(inc

ludi

ngen

d-to

-end

com

pute

risa

tion

of t

hePD

S) �t

o en

sure

tran

spar

ent r

ecor

ding

of t

rans

acti

ons

at a

llle

vels

�;4.

Sett

ing

up v

igila

nce

com

mit

tee

at s

tate

,di

stri

ct, b

lock

and

fai

r-pr

ice

shop

leve

ls t

osu

perv

ise

all s

chem

esun

der

the

act.

indi

cato

rs e

tc. w

ith

the

roll

out

of t

he f

ood

secu

rity

plan

s, e

very

5 y

ears

by

the

Cen

tral

gov

ernm

ent�

The

com

mit

tee

feel

tha

t th

eFo

od S

ecur

ity

Bill

sho

uld

belo

oked

upo

n as

a v

ehic

lew

hich

will

con

trib

ute

tore

duct

ion

in t

he le

vel o

fm

alnu

trit

ion.

The

refo

re, i

tde

sire

tha

t th

e fo

cus

onim

pact

ass

essm

ent

may

be

stre

ngth

ened

thro

ugh

inst

itut

iona

lisat

ion

ofin

depe

nden

t eva

luat

ions

of

outc

omes

, wit

h fi

xed

peri

odic

ity

in c

oord

inat

ion

wit

h th

e M

inis

try

of H

ealt

hfo

r m

easu

rem

ent o

fnu

triti

onal

out

com

es w

ith a

freq

uenc

y of

3-5

yea

rs,

cove

ring

the

entir

e co

untr

y.th

e co

mm

ittee

, the

refo

rere

com

men

d to

inse

rt in

Cla

use

40 o

f the

Bill

as

unde

r:

�Nec

essa

ry c

hang

es s

houl

d in

mad

e in

pro

visi

on o

f th

e bi

llba

sed

on t

he im

pact

asse

ssm

ents

reg

ardi

ngch

ange

s in

hea

lth

indi

cato

rset

c. w

ith

the

roll

out

of t

hefo

od s

ecur

ity

plan

s, e

very

5ye

ars

by t

he C

entr

algo

vern

men

t.�

The

com

mit

tee

note

tha

t

The

Act

als

o in

clud

es t

hem

anda

tory

tra

nspa

renc

ypr

ovis

ions

whi

ch in

clud

es:

1.Pl

acin

g al

l TPD

S-re

late

dre

cord

s in

the

pub

licdo

mai

n an

d ke

epin

g th

emop

en f

or in

spec

tion

to

the

publ

ic;

2.C

ondu

ctin

g pe

riod

ic s

ocia

lau

dits

of

the

PDS

and

othe

r w

elfa

re s

chem

es;

3.U

sing

info

rmat

ion

and

com

mun

icat

ion

tech

nolo

gy (i

nclu

ding

end

-to

-end

com

pute

risa

tion

of

the

PDS)

�to

ensu

retr

ansp

aren

t rec

ordi

ng o

ftr

ansa

ctio

ns a

t al

l lev

els�

;4.

Sett

ing

up v

igila

nce

com

mit

tee

at s

tate

,di

stri

ct, b

lock

and

fai

r-pr

ice

shop

leve

ls t

osu

perv

ise

all s

chem

esun

der

the

act.


Subs

idis

edra

tion

will

be

ear-

mar

ked

for

tran

spar

ency

mea

sure

s.

Acc

ordi

ng t

o th

e N

AC

proj

ecti

ons

tota

l sub

sidy

will

wor

k ou

t to

Rs

71,8

37 c

rore

s in

the

fir

stph

ase

and

Rs

79,9

31cr

ores

in t

he f

inal

pha

se.

The

pri

orit

y ho

useh

olds

shou

ld h

ave

a m

onth

lyen

titl

emen

t of

35k

gs a

t a

subs

idis

ed p

rice

of

Re.

1pe

r kg

for

mill

ets,

Rs

2fo

r w

heat

and

Rs.

3 f

orri

ce.

The

gen

eral

hou

seho

lds

shou

ld h

ave

a m

onth

lyen

titl

emen

t of

20

kgs

ata

pric

e no

t ex

ceed

ing

50%

of

the

curr

ent

Min

imum

Sup

port

Pri

cefo

r m

illet

s, w

heat

and

rice

.

Figu

res

need

s to

be

revi

sed

upw

ards

if w

e ch

ange

the

popu

lati

on fi

gure

s(s

cena

rio1

) an

d as

sum

e10

0% o

ffta

ke. I

t th

enin

crea

ses

to R

s 85

,584

cror

es a

nd R

s 92

,060

cror

es r

espe

ctiv

ely.

Furt

her

the

infr

astr

uctu

refa

cilit

ies

from

sca

ling

upof

the

proc

urem

ent,

war

ehou

sing

and

sup

ply

chai

n op

erat

ions

nee

ds t

obe

qua

ntif

y as

the

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Exhibit-3

National Food Security Actof India, 2013

THE NATIONAL FOOD SECURITY ACT, 2013NO. 20 OF 2013

[10th September, 2013.]

An Act to provide for food and nutritional security in human life cycle approach,by ensuring access to adequate quantity of quality food at affordable pricesto people to live a life with dignity and for matters connected therewith orincidental thereto.BE it enacted by Parliament in the Sixty-fourth Year of the Republic of India as follows:—

CHAPTER I

PRELIMINARY

1. (1) This Act may be called the National Food Security Act, 2013.

(2) It extends to the whole of India.

(3) Save as otherwise provided, it shall be deemed to have come into force on the5th day of July, 2013.

2. In this Act, unless the context otherwise requires,—

(1) "anganwadi" means a child care and development centre set up under theIntegrated Child Development Services Scheme of the Central Government to renderservices covered under section 4, clause (a) of sub-section (1) of section 5 andsection 6;

Short title,extent andcommencement.

Definitions.

jftLVªh lañ Mhñ ,yñ—¼,u½04@0007@2003—13 REGISTERED NO. DL—(N)04/0007/2003—13

vlk/kkj.kEXTRAORDINARYHkkx II — [k.M 1

PART II — Section 1izkf/kdkj ls izdkf'kr

PUBLISHED BY AUTHORITY

lañ 29] ubZ fnYyh] eaxyokj] flrEcj 10] 2013@ Hkknz 19] 1935 ¼'kd½No. 29] NEW DELHI, TUESDAY, SEPTEMBER 10, 2013/ BHADRA 19, 1935 (SAKA)

bl Hkkx esa fHkUu i`"B la[;k nh tkrh gS ftlls fd ;g vyx ladyu ds :i esa j[kk tk ldsASeparate paging is given to this Part in order that it may be filed as a separate compilation.

MINISTRY OF LAW AND JUSTICE(Legislative Department)

New Delhi, the 10th September, 2013/Bhadra 19, 1935 (Saka)

The following Act of Parliament received the assent of the President on the10th September, 2013, and is hereby published for general information:—

2 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—

(2) "central pool" means the stock of foodgrains which is,—

(i) procured by the Central Government and the State Governments throughminimum support price operations;

(ii) maintained for allocations under the Targeted Public DistributionSystem, other welfare schemes, including calamity relief and such other schemes;

(iii) kept as reserves for schemes referred to in sub-clause (ii);

(3) "eligible households" means households covered under the priorityhouseholds and the Antyodaya Anna Yojana referred to in sub-section (1) ofsection 3;

(4) "fair price shop" means a shop which has been licensed to distribute essentialcommodities by an order issued under section 3 of the Essential Commodities Act,1955, to the ration card holders under the Targeted Public Distribution System;

(5) "foodgrains" means rice, wheat or coarse grains or any combination thereofconforming to such quality norms as may be determined, by order, by the CentralGovernment from time to time;

(6) "food security" means the supply of the entitled quantity of foodgrains andmeal specified under Chapter II;

(7) "food security allowance" means the amount of money to be paid by theconcerned State Government to the entitled persons under section 8;

(8) "local authority" includes Panchayat, municipality, district board, cantonmentboard, town planning authority and in the States of Assam, Manipur, Meghalaya,Mizoram, Nagaland and Tripura where Panchayats do not exist, the village council orcommittee or any other body, by whatever name called, which is authorised under theConstitution or any law for the time being in force for self-governance or any otherauthority or body vested with the control and management of civic services, within aspecified local area;

(9) "meal" means hot cooked or pre-cooked and heated before its service meal ortake home ration, as may be prescribed by the Central Government;

(10) "minimum support price" means the assured price announced by the CentralGovernment at which foodgrains are procured from farmers by the Central Governmentand the State Governments and their agencies, for the central pool;

(11) "notification" means a notification issued under this Act and published inthe Official Gazette;

(12) "other welfare schemes" means such Government schemes, in addition tothe Targeted Public Distribution System, under which foodgrains or meals are suppliedas part of the schemes;

(13) "person with disability" means a person defined as such in clause (t) ofsection 2 of the Persons with Disabilities (Equal Opportunities, Protection of Rightsand Full Participation) Act, 1995;

(14) "priority households" means households identified as such undersection 10;

(15) "prescribed" means prescribed by rules made under this Act;

(16) "ration card" means a document issued under an order or authority of theState Government for the purchase of essential commodities from the fair price shopsunder the Targeted Public Distribution System;

(17) "rural area" means any area in a State except those areas covered by anyurban local body or a cantonment board established or constituted under any law forthe time being in force;

10 of 1955.

1 of 1996.

SEC. 1] THE GAZETTE OF INDIA EXTRAORDINARY 3

(18) "Schedule" means a Schedule appended to this Act;

(19) "senior citizen" means a person defined as such under clause (h) of section 2of the Maintenance and Welfare of Parents and Senior Citizens Act, 2007;

(20) "social audit" means the process in which people collectively monitor andevaluate the planning and implementation of a programme or scheme;

(21) "State Commission" means the State Food Commission constituted undersection 16;

(22) "State Government", in relation to a Union territory, means the Administratorthereof appointed under article 239 of the Constitution;

(23) "Targeted Public Distribution System" means the system for distribution ofessential commodities to the ration card holders through fair price shops;

(24) "Vigilance Committee" means a committee constituted under section 29 tosupervise the implementation of all schemes under this Act;

(25) the words and expressions not defined here but defined in the EssentialCommodities Act, 1955, or any other relevant Act shall have the meaning respectivelyassigned to them in those Acts.

CHAPTER II

PROVISIONS FOR FOOD SECURITY

3. (1) Every person belonging to priority households, identified under sub-section (1)of section 10, shall be entitled to receive five kilograms of foodgrains per person per monthat subsidised prices specified in Schedule I from the State Government under the TargetedPublic Distribution System:

Provided that the households covered under Antyodaya Anna Yojana shall, to suchextent as may be specified by the Central Government for each State in the said scheme, beentitled to thirty-five kilograms of foodgrains per household per month at the prices specifiedin Schedule I:

Provided further that if annual allocation of foodgrains to any State under the Act isless than the average annual offtake of foodgrains for last three years under normal TargetedPublic Distribution System, the same shall be protected at prices as may be determined by theCentral Government and the State shall be allocated foodgrains as specified in Schedule IV.

Explanation.— For the purpose of this section, the "Antyodaya Anna Yojana" means,the scheme by the said name launched by the Central Government on the 25th day ofDecember, 2000; and as modified from time to time.

(2) The entitlements of the persons belonging to the eligible households referred to insub-section (1) at subsidised prices shall extend up to seventy-five per cent. of the ruralpopulation and up to fifty per cent. of the urban population.

(3) Subject to sub-section (1), the State Government may provide to the personsbelonging to eligible households, wheat flour in lieu of the entitled quantity of foodgrains inaccordance with such guidelines as may be specified by the Central Government.

4. Subject to such schemes as may be framed by the Central Government, everypregnant woman and lactating mother shall be entitled to—

(a) meal, free of charge, during pregnancy and six months after the child birth,through the local anganwadi, so as to meet the nutritional standards specified inSchedule II; and

(b) maternity benefit of not less than rupees six thousand, in such instalments asmay be prescribed by the Central Government:

Provided that all pregnant women and lactating mothers in regular employmentwith the Central Government or State Governments or Public Sector Undertakings orthose who are in receipt of similar benefits under any law for the time being in forceshall not be entitled to benefits specified in clause (b).

56 of 2007.

10 of 1955.

Right toreceivefoodgrains atsubsidisedprices bypersonsbelonging toeligiblehouseholdsunder TargetedPublicDistributionSystem.

Nutritionalsupport topregnantwomen andlactatingmothers.


5. (1) Subject to the provisions contained in clause (b), every child up to the age offourteen years shall have the following entitlements for his nutritional needs, namely:—

(a) in the case of children in the age group of six months to six years, ageappropriate meal, free of charge, through the local anganwadi so as to meet thenutritional standards specified in Schedule II:

Provided that for children below the age of six months, exclusive breast feedingshall be promoted;

(b) in the case of children, up to class VIII or within the age group of six tofourteen years, whichever is applicable, one mid-day meal, free of charge, everyday,except on school holidays, in all schools run by local bodies, Government andGovernment aided schools, so as to meet the nutritional standards specified inSchedule II.

(2) Every school, referred to in clause (b) of sub-section (1), and anganwadi shallhave facilities for cooking meals, drinking water and sanitation:

Provided that in urban areas facilities of centralised kitchens for cooking meals may beused, wherever required, as per the guidelines issued by the Central Government.

6. The State Government shall, through the local anganwadi, identify and providemeals, free of charge, to children who suffer from malnutrition, so as to meet the nutritionalstandards specified in Schedule II.

7. The State Governments shall implement schemes covering entitlements undersections 4, 5 and section 6 in accordance with the guidelines, including cost sharing, betweenthe Central Government and the State Governments in such manner as may be prescribed bythe Central Government.

CHAPTER III

FOOD SECURITY ALLOWANCE

8. In case of non-supply of the entitled quantities of foodgrains or meals to entitledpersons under Chapter II, such persons shall be entitled to receive such food securityallowance from the concerned State Government to be paid to each person, within such timeand manner as may be prescribed by the Central Government.

CHAPTER IV

IDENTIFICATION OF ELIGIBLE HOUSEHOLDS

9. The percentage coverage under the Targeted Public Distribution System in rural andurban areas for each State shall, subject to sub-section (2) of section 3, be determined by theCentral Government and the total number of persons to be covered in such rural and urbanareas of the State shall be calculated on the basis of the population estimates as per thecensus of which the relevant figures have been published.

10. (1) The State Government shall, within the number of persons determined undersection 9 for the rural and urban areas, identify—

(a) the households to be covered under the Antyodaya Anna Yojana to theextent specified under sub-section (1) of section 3, in accordance with the guidelinesapplicable to the said scheme;

(b) the remaining households as priority households to be covered under theTargeted Public Distribution System, in accordance with such guidelines as the StateGovernment may specify:

Provided that the State Government may, as soon as possible, but within suchperiod not exceeding three hundred and sixty-five days, after the commencement of

Nutritionalsupport tochildren.

Preventionandmanagementof childmalnutrition.

Implementationof schemes forrealisation ofentitlements.

Right toreceive foodsecurityallowance incertain cases.

Coverage ofpopulationunder TargetedPublicDistributionSystem.

StateGovernmentto prepareguidelines andto identifypriorityhouseholds.


the Act, identify the eligible households in accordance with the guidelines framedunder this sub-section:

Provided further that the State Government shall continue to receive the allocationof foodgrains from the Central Government under the existing Targeted PublicDistribution System, till the identification of such households is complete.

(2) The State Government shall update the list of eligible households, within thenumber of persons determined under section 9 for the rural and urban areas, in accordancewith the guidelines framed under sub-section (1).

11. The State Government shall place the list of the identified eligible households inthe public domain and display it prominently.

CHAPTER V

REFORMS IN TARGETED PUBLIC DISTRIBUTION SYSTEM

12. (1) The Central and State Governments shall endeavour to progressively undertakenecessary reforms in the Targeted Public Distribution System in consonance with the roleenvisaged for them in this Act.

(2) The reforms shall, inter alia, include—

(a) doorstep delivery of foodgrains to the Targeted Public Distribution Systemoutlets;

(b) application of information and communication technology tools includingend-to-end computerisation in order to ensure transparent recording of transactionsat all levels, and to prevent diversion;

(c) leveraging ''aadhaar'' for unique identification, with biometric information ofentitled beneficiaries for proper targeting of benefits under this Act;

(d) full transparency of records;

(e) preference to public institutions or public bodies such as Panchayats, self-help groups, co-operatives, in licensing of fair price shops and management of fairprice shops by women or their collectives;

(f) diversification of commodities distributed under the Public Distribution Systemover a period of time;

(g) support to local public distribution models and grains banks;

(h) introducing schemes, such as, cash transfer, food coupons, or other schemes,to the targeted beneficiaries in order to ensure their foodgrain entitlements specified inChapter II, in such area and manner as may be prescribed by the Central Government.

CHAPTER VI

WOMEN EMPOWERMENT

13. (1) The eldest woman who is not less than eighteen years of age, in every eligiblehousehold, shall be head of the household for the purpose of issue of ration cards.

(2) Where a household at any time does not have a woman or a woman of eighteenyears of age or above, but has a female member below the age of eighteen years, then, theeldest male member of the household shall be the head of the household for the purpose ofissue of ration card and the female member, on attaining the age of eighteen years, shallbecome the head of the household for such ration cards in place of such male member.

CHAPTER VII

GRIEVANCE REDRESSAL MECHANISM

14. Every State Government shall put in place an internal grievance redressal mechanismwhich may include call centres, help lines, designation of nodal officers, or such othermechanism as may be prescribed.

Publicationand display oflist of eligiblehouseholds.

Reforms inTargetedPublicDistributionSystem.

Women ofeighteen yearsof age or aboveto be head ofhousehold forpurpose ofissue of rationcards.

Internalgrievanceredressalmechanism.


15. (1) The State Government shall appoint or designate, for each district, an officer tobe the District Grievance Redressal Officer for expeditious and effective redressal ofgrievances of the aggrieved persons in matters relating to distribution of entitled foodgrainsor meals under Chapter II, and to enforce the entitlements under this Act.

(2) The qualifications for appointment as District Grievance Redressal Officer and itspowers shall be such as may be prescribed by the State Government.

(3) The method and terms and conditions of appointment of the District GrievanceRedressal Officer shall be such as may be prescribed by the State Government.

(4) The State Government shall provide for the salary and allowances of the DistrictGrievance Redressal Officer and other staff and such other expenditure as may be considerednecessary for their proper functioning.

(5) The officer referred to in sub-section (1) shall hear complaints regarding non-distribution of entitled foodgrains or meals, and matters relating thereto, and take necessaryaction for their redressal in such manner and within such time as may be prescribed by theState Government.

(6) Any complainant or the officer or authority against whom any order has beenpassed by officer referred to in sub-section (1), who is not satisfied with the redressal ofgrievance may file an appeal against such order before the State Commission.

(7) Every appeal under sub-section (6) shall be filed in such manner and within suchtime as may be prescribed by the State Government.

16. (1) Every State Government shall, by notification, constitute a State FoodCommission for the purpose of monitoring and review of implementation of this Act.

(2) The State Commission shall consist of—

(a) a Chairperson;

(b) five other Members; and

(c) a Member-Secretary, who shall be an officer of the State Government notbelow the rank of Joint Secretary to that Government:

Provided that there shall be at least two women, whether Chairperson, Memberor Member-Secretary:

Provided further that there shall be one person belonging to the ScheduledCastes and one person belonging to the Scheduled Tribes, whether Chairperson,Member or Member-Secretary.

(3) The Chairperson and other Members shall be appointed from amongst persons—

(a) who are or have been member of the All India Services or any other civilservices of the Union or State or holding a civil post under the Union or State havingknowledge and experience in matters relating to food security, policy making andadministration in the field of agriculture, civil supplies, nutrition, health or any alliedfield; or

(b) of eminence in public life with wide knowledge and experience in agriculture,law, human rights, social service, management, nutrition, health, food policy or publicadministration; or

(c) who have a proven record of work relating to the improvement of the foodand nutrition rights of the poor.

(4) The Chairperson and every other Member shall hold office for a term not exceedingfive years from the date on which he enters upon his office and shall be eligible forreappointment:

DistrictGrievanceRedressalOfficer.

State FoodCommission.


Provided that no person shall hold office as the Chairperson or other Member after hehas attained the age of sixty-five years.

(5) The method of appointment and other terms and conditions subject to which theChairperson, other Members and Member-Secretary of the State Commission may beappointed, and time, place and procedure of meetings of the State Commission (including thequorum at such meetings) and its powers, shall be such as may be prescribed by the StateGovernment.

(6) The State Commission shall undertake the following functions, namely:—

(a) monitor and evaluate the implementation of this Act, in relation to theState;

(b) either suo motu or on receipt of complaint inquire into violations ofentitlements provided under Chapter II;

(c) give advice to the State Government on effective implementation of this Act;

(d) give advice to the State Government, their agencies, autonomous bodies aswell as non-governmental organisations involved in delivery of relevant services, forthe effective implementation of food and nutrition related schemes, to enable individualsto fully access their entitlements specified in this Act;

(e) hear appeals against orders of the District Grievance Redressal Officer;

(f) prepare annual reports which shall be laid before the State Legislature by theState Government.

(7) The State Government shall make available to the State Commission, suchadministrative and technical staff, as it may consider necessary for proper functioning of theState Commission.

(8) The method of appointment of the staff under sub-section (7), their salaries,allowances and conditions of service shall be such, as may be prescribed by the StateGovernment.

(9) The State Government may remove from office the Chairperson or any Memberwho—

(a) is, or at any time has been, adjudged as an insolvent; or

(b) has become physically or mentally incapable of acting as a member; or

(c) has been convicted of an offence which, in the opinion of the StateGovernment, involves moral turpitude; or

(d) has acquired such financial or other interest as is likely to affect prejudiciallyhis functions as a member; or

(e) has so abused his position as to render his continuation in office detrimentalto the public interest.

(10) No such Chairperson or Member shall be removed under clause (d) or clause (e)of sub-section (9) unless he has been given a reasonable opportunity of being heard in thematter.

17. The State Government shall provide for salary and allowances of Chairperson,other Members, Member-Secretary, support staff, and other administrative expenses requiredfor proper functioning of the State Commission.

Salary andallowances ofChairperson,Member,Member-Secretary andother staff ofStateCommission.


18. The State Government may, if considers it necessary, by notification, designateany statutory commission or a body to exercise the powers and perform the functions of theState Commission referred to in section 16.

19. Notwithstanding anything contained in sub-section (1) of section 16, two or moreStates may have a Joint State Food Commission for the purposes of this Act with theapproval of the Central Government.

20. (1) The State Commission shall, while inquiring into any matter referred to inclauses (b) and (e) of sub-section (6) of section 16, have all the powers of a civil court whiletrying a suit under the Code of Civil Procedure, 1908, and, in particular, in respect of thefollowing matters, namely:—

(a) summoning and enforcing the attendance of any person and examining himon oath;

(b) discovery and production of any document;

(c) receiving evidence on affidavits;

(d) requisitioning any public record or copy thereof from any court or office; and

(e) issuing commissions for the examination of witnesses or documents.

(2) The State Commission shall have the power to forward any case to a Magistratehaving jurisdiction to try the same and the Magistrate to whom any such case is forwardedshall proceed to hear the complaint against the accused as if the case has been forwarded tohim under section 346 of the Code of Criminal Procedure, 1973.

21. No act or proceeding of the State Commission shall be invalid merely by reasonof—

(a) any vacancy in, or any defect in the constitution of, the State Commission; or

(b) any defect in the appointment of a person as the Chairperson or a Member ofthe State Commission; or

(c) any irregularity in the procedure of the State Commission not affecting themerits of the case.

CHAPTER VIII

OBLIGATIONS OF CENTRAL GOVERNMENT FOR FOOD SECURITY

22. (1) The Central Government shall, for ensuring the regular supply of foodgrains topersons belonging to eligible households, allocate from the central pool the required quantityof foodgrains to the State Governments under the Targeted Public Distribution System, asper the entitlements under section 3 and at prices specified in Schedule I.

(2) The Central Government shall allocate foodgrains in accordance with the numberof persons belonging to the eligible households identified in each State under section 10.

(3) The Central Government shall provide foodgrains in respect of entitlements undersections 4, 5 and section 6, to the State Governments, at prices specified for the personsbelonging to eligible households in Schedule I.

(4) Without prejudice to sub-section (1), the Central Government shall,—

(a) procure foodgrains for the central pool through its own agencies and theState Governments and their agencies;

(b) allocate foodgrains to the States;

Designation ofanyCommission orbody tofunction asStateCommission.

Joint StateFoodCommission.

Powersrelating toinquiries.

5 of 1908.

Vacancies,etc., not toinvalidateproceedingsof StateCommission.

2 of 1974.

CentralGovernmentto allocaterequiredquantity offoodgrainsfrom centralpool to StateGovernments.


(c) provide for transportation of foodgrains, as per allocation, to the depotsdesignated by the Central Government in each State;

(d) provide assistance to the State Government in meeting the expenditureincurred by it towards intra-State movement, handling of foodgrains and margins paidto fair price shop dealers, in accordance with such norms and manner as may beprescribed by the Central Government; and

(e) create and maintain required modern and scientific storage facilities at variouslevels.

23. In case of short supply of foodgrains from the central pool to a State, the CentralGovernment shall provide funds to the extent of short supply to the State Government formeeting obligations under Chapter II in such manner as may be prescribed by the CentralGovernment.

CHAPTER IX

OBLIGATIONS OF STATE GOVERNMENT FOR FOOD SECURITY

24. (1) The State Government shall be responsible for implementation andmonitoring of the schemes of various Ministries and Departments of the CentralGovernment in accordance with guidelines issued by the Central Government for eachscheme, and their own schemes, for ensuring food security to the targeted beneficiariesin their State.

(2) Under the Targeted Public Distribution System, it shall be the duty of the StateGovernment to—

(a) take delivery of foodgrains from the designated depots of the CentralGovernment in the State, at the prices specified in Schedule I, organise intra-Stateallocations for delivery of the allocated foodgrains through their authorised agenciesat the door-step of each fair price shop; and

(b) ensure actual delivery or supply of the foodgrains to the entitled persons atthe prices specified in Schedule I.

(3) For foodgrain requirements in respect of entitlements under sections 4, 5 andsection 6, it shall be the responsibility of the State Government to take delivery of foodgrainsfrom the designated depots of the Central Government in the State, at the prices specified inSchedule I for persons belonging to eligible households and ensure actual delivery of entitledbenefits, as specified in the aforesaid sections.

(4) In case of non-supply of the entitled quantities of foodgrains or meals to entitledpersons under Chapter II, the State Government shall be responsible for payment of foodsecurity allowance specified in section 8.

(5) For efficient operations of the Targeted Public Distribution System, every StateGovernment shall,—

(a) create and maintain scientific storage facilities at the State, District and Blocklevels, being sufficient to accommodate foodgrains required under the Targeted PublicDistribution System and other food based welfare schemes;

(b) suitably strengthen capacities of their Food and Civil Supplies Corporationsand other designated agencies;

(c) establish institutionalised licensing arrangements for fair price shops inaccordance with the relevant provisions of the Public Distribution System (Control)Order, 2001 made under the Essential Commodities Act, 1955, as amended from timeto time.

Provisionsfor funds byCentralGovernmentto StateGovernmentin certaincases.

Implementationandmonitoring ofschemes forensuring foodsecurity.

10 of 1955.


CHAPTER X

OBLIGATIONS OF LOCAL AUTHORITIES

25. (1) The local authorities shall be responsible for the proper implementation of thisAct in their respective areas.

(2) Without prejudice to sub-section (1), the State Government may assign, bynotification, additional responsibilities for implementation of the Targeted Public DistributionSystem to the local authority.

26. In implementing different schemes of the Ministries and Departments of theCentral Government and the State Governments, prepared to implement provisions of thisAct, the local authorities shall be responsible for discharging such duties and responsibilitiesas may be assigned to them, by notification, by the respective State Governments.

CHAPTER XI

TRANSPARENCY AND ACCOUNTABILITY

27. All Targeted Public Distribution System related records shall be placed in thepublic domain and kept open for inspection to the public, in such manner as may be prescribedby the State Government.

28. (1) Every local authority, or any other authority or body, as may be authorised bythe State Government, shall conduct or cause to be conducted, periodic social audits on thefunctioning of fair price shops, Targeted Public Distribution System and other welfare schemes,and cause to publicise its findings and take necessary action, in such manner as may beprescribed by the State Government.

(2) The Central Government may, if it considers necessary, conduct or cause to beconducted social audit through independent agencies having experience in conduct of suchaudits.

29. (1) For ensuring transparency and proper functioning of the Targeted PublicDistribution System and accountability of the functionaries in such system, every StateGovernment shall set up Vigilance Committees as specified in the Public Distribution System(Control) Order, 2001, made under the Essential Commodities Act, 1955, as amended fromtime to time, at the State, District, Block and fair price shop levels consisting of such persons,as may be prescribed by the State Government giving due representation to the localauthorities, the Scheduled Castes, the Scheduled Tribes, women and destitute persons orpersons with disability.

(2) The Vigilance Committees shall perform the following functions, namely:—

(a) regularly supervise the implementation of all schemes under this Act;

(b) inform the District Grievance Redressal Officer, in writing, of any violation ofthe provisions of this Act; and

(c) inform the District Grievance Redressal Officer, in writing, of any malpracticeor misappropriation of funds found by it.

CHAPTER XII

PROVISIONS FOR ADVANCING FOOD SECURITY

30. The Central Government and the State Governments shall, while implementing theprovisions of this Act and the schemes for meeting specified entitlements, give special focusto the needs of the vulnerable groups especially in remote areas and other areas which aredifficult to access, hilly and tribal areas for ensuring their food security.

Implementationof TargetedPublicDistributionSystem bylocal authorityin their areas.

Obligations oflocalauthority.

Disclosure ofrecords ofTargetedPublicDistributionSystem.

Conduct ofsocial audit.

Setting up ofVigilanceCommittees.

10 of 1955.

Food securityfor peopleliving inremote, hillyand tribalareas.


31. The Central Government, the State Governments and local authorities shall, for thepurpose of advancing food and nutritional security, strive to progressively realise theobjectives specified in Schedule III.

CHAPTER XIII

MISCELLANEOUS

32. (1) The provisions of this Act shall not preclude the Central Government or theState Government from continuing or formulating other food based welfare schemes.

(2) Notwithstanding anything contained in this Act, the State Government may, continuewith or formulate food or nutrition based plans or schemes providing for benefits higher thanthe benefits provided under this Act, from its own resources.

33. Any public servant or authority found guilty, by the State Commission at the timeof deciding any complaint or appeal, of failing to provide the relief recommended by theDistrict Grievance Redressal Officer, without reasonable cause, or wilfully ignoring suchrecommendation, shall be liable to penalty not exceeding five thousand rupees:

Provided that the public servant or the public authority, as the case may be, shall begiven a reasonable opportunity of being heard before any penalty is imposed.

34. (1) For the purpose of adjudging penalty under section 33, the State Commissionshall authorise any of its member to be an adjudicating officer for holding an inquiry in theprescribed manner after giving any person concerned a reasonable opportunity of beingheard for the purpose of imposing any penalty.

(2) While holding an inquiry the adjudicating officer shall have power to summon andenforce the attendance of any person acquainted with the facts and circumstances of thecase to give evidence or to produce any document which in the opinion of the adjudicatingofficer, may be useful for or relevant to the subject matter of the inquiry and if, on suchinquiry, he is satisfied that the person has failed to provide the relief recommended by theDistrict Grievance Redressal Officer, without reasonable cause, or wilfully ignored suchrecommendation, he may impose such penalty as he thinks fit in accordance with theprovisions of section 33.

35. (1) The Central Government may, by notification, direct that the powers exercisableby it (except the power to make rules), in such circumstances and subject to such conditionsand limitations, be exercisable also by the State Government or an officer subordinate to theCentral Government or the State Government as it may specify in the notification.

(2) The State Government may, by notification, direct that the powers exercisable by it(except the power to make rules), in such circumstances and subject to such conditions andlimitations, be exercisable also by an officer subordinate to it as it may specify in thenotification.

36. The provisions of this Act or the schemes made thereunder shall have effectnotwithstanding anything inconsistent therewith contained in any other law for the timebeing in force or in any instrument having effect by virtue of such law.

37. (1) If the Central Government is satisfied that it is necessary or expedient so to do,it may, by notification, amend Schedule I or Schedule II or Schedule III or Schedule IV andthereupon Schedule I or Schedule II or Schedule III or Schedule IV, as the case may be, shallbe deemed to have been amended accordingly.

(2) A copy of every notification issued under sub-section (1), shall be laid before eachHouse of Parliament as soon as may be after it is issued.

38. The Central Government may, from time to time, give such directions, as it mayconsider necessary, to the State Governments for the effective implementation of the provisionsof this Act and the State Governments shall comply with such directions.

Steps tofurtheradvance foodandnutritionalsecurity.

Other welfareschemes.

Penalties.

Power toadjudicate.

Power todelegate byCentralGovernmentand StateGovernment.

Act to haveoverridingeffect.

Power toamendSchedules.

Power ofCentralGovernmentto givedirections.


39. (1) The Central Government may, in consultation with the State Governments andby notification, make rules to carry out the provisions of this Act.

(2) In particular, and without prejudice to the generality of the foregoing power, suchrules may provide for all or any of the following matters, namely:—

(a) scheme including cost sharing for providing maternity benefit to pregnantwomen and lactating mothers under clause (b) of section 4;

(b) schemes covering entitlements under sections 4, 5 and section 6 includingcost sharing under section 7;

(c) amount, time and manner of payment of food security allowance to entitledindividuals under section 8;

(d) introducing schemes of cash transfer, food coupons or other schemes to thetargeted beneficiaries in order to ensure their foodgrains entitlements in such areasand manner under clause (h) of sub-section (2) of section 12;

(e) the norms and manner of providing assistance to the State Governments inmeeting expenditure under clause (d) of sub-section (4) of section 22;

(f) manner in which funds shall be provided by the Central Government to theState Governments in case of short supply of foodgrains, under section 23;

(g) any other matter which is to be, or may be, prescribed or in respect of whichprovision is to be made by the Central Government by rules.

(3) Every rule made by the Central Government under this Act shall be laid, as soon asmay be after it is made, before each House of Parliament, while it is in session, for a totalperiod of thirty days which may be comprised in one session or in two or more successivesessions, and if, before the expiry of the session immediately following the session or thesuccessive sessions aforesaid, both Houses agree in making any modification in the rule orboth Houses agree that the rule should not be made, the rule shall thereafter have effectonly in such modified form or be of no effect, as the case may be; so, however, that any suchmodification or annulment shall be without prejudice to the validity of anything previouslydone under that rule.

40. (1) The State Government may, by notification, and subject to the condition ofprevious publication, and consistent with this Act and the rules made by the CentralGovernment, make rules to carry out the provisions of this Act.

(2) In particular and without prejudice to the generality of the foregoing power, suchrules may provide for all or any of the following matters, namely:—

(a) guidelines for identification of priority households under sub-section (1) ofsection 10;

(b) internal grievance redressal mechanism under section 14;

(c) qualifications for appointment as District Grievance Redressal Officer and itspowers under sub-section (2) of section 15;

(d) method and terms and conditions of appointment of the District GrievanceRedressal Officer under sub-section (3) of section 15;

(e) manner and time limit for hearing complaints by the District GrievanceRedressal Officer and the filing of appeals under sub-sections (5) and (7) of section 15;

(f) method of appointment and the terms and conditions of appointment ofChairperson, other Members and Member-Secretary of the State Commission, procedurefor meetings of the Commission and its powers, under sub-section (5) of section 16;

(g) method of appointment of staff of the State Commission, their salaries,allowances and conditions of service under sub-section (8) of section 16;

Power ofCentralGovernmentto make rules.

Power ofStateGovernmentto make rules.


(h) manner in which the Targeted Public Distribution System related recordsshall be placed in the public domain and kept open for inspection to public undersection 27;

(i) manner in which the social audit on the functioning of fair price shops,Targeted Public Distribution System and other welfare schemes shall be conductedunder section 28;

(j) composition of Vigilance Committees under sub-section (1) of section 29;

(k) schemes or programmes of the Central Government or the State Governmentsfor utilisation of institutional mechanism under section 43;

(l) any other matter which is to be, or may be, prescribed or in respect of whichprovision is to be made by the State Government by rules.

(3) Every rule, notification and guidelines made or issued by the State Governmentunder this Act shall, as soon as may be after it is made or issued, be laid before each Houseof the State Legislature where there are two Houses, and where there is one House of theState Legislature, before that House.

41. The schemes, guidelines, orders and food standard, grievance redressal mechanism,vigilance committees, existing on the date of commencement of this Act, shall continue to bein force and operate till such schemes, guidelines, orders and food standard, grievanceredressal mechanism, vigilance committees are specified or notified under this Act or therules made thereunder:

Provided that anything done or any action taken under the said schemes, guidelines,orders and food standard, grievance redressal mechanism, or by vigilance committees shallbe deemed to have been done or taken under the corresponding provisions of this Act andshall continue to be in force accordingly unless and until superseded by anything done orby any action taken under this Act.

42. (1) If any difficulty arises in giving effect to the provisions of this Act, the CentralGovernment may, by order, published in the Official Gazette, make such provisions, notinconsistent with the provisions of this Act, as appear to it to be necessary or expedient forremoving the difficulty:

Provided that no order shall be made under this section after the expiry of two yearsfrom the date of commencement of this Act.

(2) Every order made under this section shall be laid, as soon as may be after it is made,before each House of Parliament.

43. The services of authorities to be appointed or constituted under sections 15 and 16may be utilised in the implementation of other schemes or programmes of the CentralGovernment or the State Governments, as may be prescribed by the State Government.

44. The Central Government, or as the case may be, the State Government, shall beliable for a claim by any person entitled under this Act, except in the case of war, flood,drought, fire, cyclone or earthquake affecting the regular supply of foodgrains or meals tosuch person under this Act:

Provided that the Central Government may, in consultation with the PlanningCommission, declare whether or not any such situation affecting the regular supply offoodgrains or meals to such person has arisen or exists.

45. (1) The National Food Security Ordinance, 2013 is hereby repealed.

(2) Notwithstanding such repeal,—

(a) anything done, any action taken or any identification of eligible householdsmade; or

Transitoryprovisions forschemes,guidelines,etc.

Power toremovedifficulties.

Utilisation ofinstitutionalmechanismfor otherpurposes.

ForceMajeure.

Repeal andsavings.

Ord. 7 of 2013.


(b) any right, entitlement, privilege, obligation or liability acquired, accrued orincurred; or

(c) any guidelines framed or directions issued; or

(d) any investigation, inquiry or any other legal proceeding initiated, conductedor continued in respect of such right, entitlement, privilege, obligation or liability asaforesaid; or

(e) any penalty imposed in respect of any offence,

under the said Ordinance shall be deemed to have been done, taken, made, acquired, accrued,incurred, framed, issued, initiated, conducted, continued or imposed under the correspondingprovisions of this Act.


SCHEDULE I

[See sections 3(1), 22(1), (3) and 24 (2), (3)]

SUBSIDISED PRICES UNDER TARGETED PUBLIC DISTRIBUTION SYSTEM

Eligible households shall be entitled to foodgrains under section 3 at the subsidisedprice not exceeding rupees 3 per kg for rice, rupees 2 per kg for wheat and rupee 1 per kg forcoarse grains for a period of three years from the date of commencement of this Act; andthereafter, at such price, as may be fixed by the Central Government, from time to time, notexceeding,—

(i) the minimum support price for wheat and coarse grains; and

(ii) the derived minimum support price for rice,

as the case may be.


SCHEDULE II

[See sections 4(a), 5(1) and 6]

NUTRITIONAL STANDARDS

Nutritional standards: The nutritional standards for children in the age group of6 months to 3 years, age group of 3 to 6 years and pregnant women and lactating mothersrequired to be met by providing “Take Home Rations” or nutritious hot cooked meal inaccordance with the Integrated Child Development Services Scheme and nutritional standardsfor children in lower and upper primary classes under the Mid Day Meal Scheme are asfollows:

Serial Category Type of Calories Proteinnumber meal2 (Kcal) (g)

1 2 3 4 5

1. Children (6 months to Take Home Ration 500 12-153 years)

2. Children (3 to 6 years) Morning Snack and 500 12-15Hot Cooked Meal

3. Children (6 months to Take Home Ration 800 20-256 years) who aremalnourished

4. Lower primary classes Hot Cooked Meal 450 12

5. Upper primary classes Hot Cooked Meal 700 20

6. Pregnant women and Take Home Ration 600 18-20Lactating mothers


SCHEDULE III

(See section 31)

PROVISIONS FOR ADVANCING FOOD SECURITY

(1) Revitalisation of Agriculture—

(a) agrarian reforms through measures for securing interests of small and marginalfarmers;

(b) increase in investments in agriculture, including research and development,extension services, micro and minor irrigation and power to increase productivity andproduction;

(c) ensuring livelihood security to farmers by way of remunerative prices, accessto inputs, credit, irrigation, power, crop insurance, etc.;

(d) prohibiting unwarranted diversion of land and water from food production.

(2) Procurement, Storage and Movement related interventions—

(a) incentivising decentralised procurement including procurement of coarsegrains;

(b) geographical diversification of procurement operations;

(c) augmentation of adequate decentralised modern and scientific storage;

(d) giving top priority to movement of foodgrains and providing sufficient numberof rakes for this purpose, including expanding the line capacity of railways to facilitatefoodgrain movement from surplus to consuming regions.

(3) Others: Access to—

(a) safe and adequate drinking water and sanitation;

(b) health care;

(c) nutritional, health and education support to adolescent girls;

(d) adequate pensions for senior citizens, persons with disability and singlewomen.

SCHEDULE IV

[See section 3(1)]

STATE-WISE ALLOCATION OF FOODGRAINS

S. No. Name of the State Quantity (in lakh tons)

1 2 3

1. Andhra Pradesh 32.102. Arunachal Pradesh 0.893. Assam 16.954. Bihar 55.275. Chhattisgarh 12.916. Delhi 5.737. Goa 0.598. Gujarat 23.959. Haryana 7.95

10. Himachal Pradesh 5.0811. Jammu and Kashmir 7.5112. Jharkhand 16.9613. Karnataka 25.5614. Kerala 14.2515. Madhya Pradesh 34.6816. Maharashtra 45.0217. Manipur 1.5118. Meghalaya 1.7619. Mizoram 0.6620. Nagaland 1.3821. Odisha 21.0922. Punjab 8.7023. Rajasthan 27.9224. Sikkim 0.4425. Tamilnadu 36.7826. Tripura 2.7127. Uttar Pradesh 96.1528. Uttarakhand 5.0329. West Bengal 38.4930. Andaman and Nicobar Islands 0.1631. Chandigarh 0.3132. Dadra and Nagar Haveli 0.1533. Daman and Diu 0.0734. Lakshadweep 0.0535. Puducherry 0.50

Total 549.26

————

DR. SANJAY SINGH,Additional Secretary to the Govt. of India.

PRINTED BY DIRECTORATE OF PRINTING AT GOVERNMENT OF INDIA PRESS, MINTO ROAD,NEW DELHI AND PUBLISHED BY THE CONTROLLER OF PUBLICATIONS, DELHI.

GMGIPMRND—2740GI(S4)—10-09-2013.

18 THE GAZETTE OF INDIA EXTRAORDINARY [PART II— SEC. 1]

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