Commodity Analysis

Food security and the dutiful PDS sentinel

Sachin Kumar Sharma Teesta Lahiri | Updated on June 08, 2020 Published on May 31, 2020

Covid-19 serves as a timely reminder of the utility of the PDS in the fight against hunger

In the light of the increasing number of coronavirus infections, the government has a daunting task of mitigating the adverse impact of this pandemic on the economy. Besides curbing its spread, the foremost concern for the government is ensuring food security for its people.

In the absence of proper safety nets, it is feared that the number of people suffering from hunger will exponentially increase amid the pandemic. In this context, the role and effectiveness of the public distribution system (PDS) in ensuring food security amid this global crisis needs to be examined.

Importance of PDS

History shows that pandemics and food insecurity often come hand in hand due to a steep increase in prices of food as a result of disruptions in distribution channels.

During the Spanish Influenza in the 1920s which killed more than 100 million people, widespread starvation deaths and hunger were reported.

Even the most recent outbreaks of Ebola, SARS, and MERS have adversely impacted food and nutrition security in the affected regions.

India did not remain untouched by the disastrous effects of the Spanish flu and recorded more than 17 million deaths and large-scale hunger. Another economic catastrophe, the Bengal famine of 1943, had a devastating effect on India’s food security.

The increased demand for food against the backdrop of World War-II, widespread inflation, hoarding and the British government’s disinclination to react to the situation led to more than three million casualties.

Post-Independence, achieving self-sufficiency in foodgrains and ensuring food for all were the main challenges before India. Therefore, India resorted to a minimum support price (MSP) policy in 1966, in conjunction with PDS, and sought to protect both the producers and consumers from the price fluctuations in foodgrains.

Over the years, PDS has played a crucial role in reducing poverty and undernourishment by providing foodgrains at subsidised rates to poor people.

Currently, more than 80 crore individuals are entitled to receive subsidised foodgrains through PDS under the National Food Security Act, 2013.

As a result of the Green Revolution and MSP-based food security policy, India achieved self-sufficiency in foodgrain production, with the combined production of wheat and rice increasing from 44 million tonnes (mt) in 1960 to 223 mt in 2019-20.

This enabled India to successfully avert the occurrence of events like the Bengal Famine.

Criticism against PDS

Despite these achievements, the PDS often comes under severe criticism for leakage, corruption, mismanagement and faulty identification of beneficiaries.

With more than ₹1,38,667 crore worth of food subsidy in 2019-20, this policy also faces regular criticism for its colossal fiscal cost.

Based on this, many suggest the dismantling of the price support-backed PDS by replacing it with direct benefit transfers to farmers and consumers and minimising food reserves.

These are based on the premise that the free market can take care of the food security concerns of a developing country in times of crisis.

However, the experience of many developing countries such as Malawi and Indonesia in liberalising their food security policies under the IMF structural adjustment programme in the late 1990s does not support this line of thought. Resultantly, Malawi and Indonesia witnessed increased hunger, starvation and loss of farm income.

After these unfortunate experiences, both countries again adopted farmer and consumer-oriented policies for food security.

Further, dependence on international trade for food security is unreliable as proven during the 2008 food crisis when many countries adopted export restriction measures on food to protect the stakeholders from inflationary prices. Even in the current outbreak, many countries have initiated these measures to maintain enough domestic supply for food security purposes.

India also had a bitter experience in the 1970s when the US refused to export wheat under the PL-480 programme amid the cold war, which threatened the sovereignty of India.

Food stocks in abundance

Besides ensuring stable income to farmers and affordable foodgrains to vulnerable sections, food stocks have an important role to play in the current humanitarian crisis.

It is nothing short of a blessing that the Food Corporation of India (FCI) currently has 58.50 mt of stocks of wheat and milled rice in comparison to 21.04 mt of food stocking norms.

In addition, the FCI also has a stock of 28.7 mt of unmilled paddy.

Additional food entitlement for more than 80 crore people for three months under the PM Garib Kalyan Ann Yojana has been made feasible by the comfortable food reserves as well as the well-established network of 5.27 lakh fair price shops.

At a time when global hunger is on the rise, with 19.5 crore Indians undernourished, dependence on market forces without any social safety net would have been disastrous for food security.

There is no doubt that the PDS has its shortcomings, but its role in ensuring food security cannot be undermined. This pandemic yet again serves as a timely reminder of the utility of the PDS in the fight against hunger.

Sharma is Associate Professor, and Lahiri is Research Fellow, at the Centre for WTO Studies, IIFT

Published on May 31, 2020
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