one nation one ration card: One nation, one ration card: Inside food ministry’s ambitious scheme to make ration cards portable

Record-keeping by hand is back at this “automated” fair price shop in Bangur, a dense Kolkata suburb, ever since its electronic point-of-sale (ePoS) machine broke down and had to be sent for repair.

Keeping an eye on the weighing scale while giving beneficiaries their quotas of gom (wheat) and chaal (rice), Lakshmi Kant Aich, who has been running the ration shop for decades, is making notes about the transactions on a booklet.

However, the absence of an ePoS device is slowing down the process. One beneficiary, Sanat Kumar Saha, is here to link his Aadhaar to his ration card through a biometric verification facility on the device. He goes back disappointed.

Aich says though the government has made ePoS machines mandatory, dealers are facing poor connectivity and frequent device breakdowns.

His shop is one of the 17,157 automated fair price shops in West Bengal with an electronic recordkeeping and point-of-sale device, while the remaining 3,649 shops have yet to be automated.

Ration insecurity

At these fair price shops, numbering nearly 5.35 lakh across India, 23 crore ration card holders can every month buy up to 5 kg of rice at Rs 3/kg, wheat at Rs 2/kg and coarse grains at Rs 1/kg as mandated under the National Food Security Act passed in 2013.

The central and state governments coordinate this complex public distribution system. While the Centre allocates and transports the foodgrain from Food Corporation of India godowns to the ration shops, the onus of ensuring that right beneficiaries get the subsidised foodgrain falls on the states and Union territories. They identify eligible households, issue ration cards and licences to dealers and also tackle complaints.

But in this entire process, put in place to ensure no one goes hungry, there has been a losing side too: millions of migrants, who move within their home states (intra-state) and to other states (inter-state) to earn a livelihood.

Since their ration cards are linked to the places where they used to live, these migrants have to apply for new ration cards at their new locations if they want to buy subsidised foodgrain. Many do not, deterred by the long process, denting the government’s efforts to ensure food security for all (the National Food Security Act covers nearly 80 crore people). Ensuring that migrants, numbering nearly 14 crore (according to the 2011 Census), get foodgrain from ration shops at their new location remains a big challenge.

Portable solution

The challenge for migrant workers to buy ration may change if the food and public distribution ministry’s One Nation One Ration Card scheme to make ration cards portable gets going, with biometric verification and ePoS machines acting as the lynchpins. Under this initiative, which is expcted to be rolled out across India by the next financial year, any migrant ration card holder will be able to buy subsidised foodgrain from any fair price shop in India without the need to obtain a new ration card for the new location. This will reform the current rule under which a beneficiary could buy ration only from a nearby shop linked to the ration card.

The ministry has already launched intra-state ration card portability in 11 states and inter-state portability between Andhra Pradesh and Telangana, Gujarat and Maharashtra, Haryana and Rajasthan and Karnataka and Kerala. This means a ration card holder from Gujarat can not only buy his stock from any of the ration shops in his state but also from Maharashtra.

One Nation One Ration Card would offer public distribution system benefits from any of the ration shops with the help of a single digital card linked to the beneficiary’s Aadhaar. “The scheme, when launched pan-India, will be a big relief for migrant labourers, daily wagers and the poor in general. We have already launched pilot projects in some clusters,” Ram Vilas Paswan, minister for consumer affairs, food & public distribution, told ET Magazine.

But food security experts say that before the big rollout of the scheme, basic requirements remain unmet. “All fair price shops would need ePoS devices for seamless biometric authentication. Additionally, getting the current location of the migrant worker to avoid duplication is another challenge,” says Sandip Das, a senior consultant with Indian Council for Research on International Economic Relations (ICRIER), a Delhibased think tank.

According to food ministry data, as of now, 4.37 lakh (nearly 82%) of the 5.35 lakh fair price shops have ePoS devices. Transactions on these devices are fool-proof as dealers such as Aich in Kolkata do not have to keep the record manually. The devices also check for duplication of ration card holders.

While Andhra Pradesh, Gujarat, Haryana, Jammu & Kashmir and Maharashtra have automated all their fair price shops, few most ration shops in Bihar and Uttarakhand and none in Arunachal Pradesh, Manipur, Meghalaya, Mizoram and Nagaland have ePoS devices, delaying the quick rollout of the portability plan. In Bihar, which sees a lot of labour migration, only 6,371 of the 41,483 fair price shops have ePoS devices.

Union food secretary Ravi Kant says the remaining ration shops will get ePoS devices shortly. “However, automating some fair price shops in remote areas may be a challenge,” he tells ET Magazine.

The other challenge is ending duplication of ration cards, whereby a beneficiary is denied foodgrain since someone else took away the quota using a fake card. To tackle this, Kant says the government is setting up a central repository of all ration cards and only those beneficiaries whose names are in the database after de-duplication would be able to use ration card portability.

Under the scheme, the existing ration card of a beneficiary remains valid under the portability plan since card data and entitlements are maintained in the person’s home state. But through the central repository the beneficiary’s state will be able to fetch the data from its server after biometric authentication.

“More than 1,000 migrant workers from Andhra Pradesh have bought subsidised ration in Telangana every month since the scheme was launched in August,” says a senior official at the food and public distribution department.

For the scheme to be seamless, the government will have to allocate foodgrain quota to each state on a dynamic basis based on the offtake volumes. “The government will have to make fresh estimates for foodgrain required to meet the demand due to seasonal migration and fluctuation in demand based on movement of labourers,” says Das of ICRIER.

Many workers from Uttar Pradesh and Bihar move to Punjab and Haryana during the crop harvesting season only to return home within a few months. As of now, the Centre allots foodgrain to a state according to a district-wise requirement based on the number of ration card holders and previous year’s allocation.

A top official at the Food Corporation of India (FCI), which supplies subsidised foodgrain to the shops from its 2,100-odd godowns, says there is no need to build fresh storage facility for the ration card portability scheme. “We have sufficient capacity to cater to any need. We maintain three to four months of buffer stock in every state based on specific allocation requirement. Otherwise too, we have surplus stock and paddy procurement has also started,” says RP Singh, executive directorprocurement & sales at FCI.

In 2015, the Rajasthan government tried another experiment: letting Future Group run some fair price shops in the state. Under the arrangement, India’s largest retailer will get to manage 5,000 of the nearly 26,745 fair price shops in the state. The company is also giving a facelift to ration shops in West Bengal.

DBT vs Portability

Though ration card portability plans to unify fair price shops across India, the government has done away with selling subsidised foodgrain in Chandigarh and Puducherry — both Union territories. Since 2015, ration card holders there have been receiving direct benefit transfer, where cash equivalent of the subsidy is transferred to the bank accounts of eligible households, enabling them to purchase items of their choice from the market. The scheme was also partially launched in Dadar & Nagar Haveli in 2016. “One Nation One Ration Card as a concept is novel but direct benefit transfer is the way forward as recommended by the high-level committee chaired by [former Union minister] Shanta Kumar,” says Das.

“There is no logic in giving foodgrain under PDS to food-surplus and infrastructurallybetter-off states such as Punjab and Haryana. It is time the government shifts to direct benefit transfer in such regions,” says former agriculture secretary Siraj Hussain.

The panel on reforming FCI had, in 2015, recommended a gradual introduction of cash transfers in public distribution system, starting with cities with more than 10 lakh population, extending it to grain-surplus states and then giving an option to deficit states to opt for cash or subsidy. However, even with direct benefit transfer, last-mile installation and maintenance of points of sale and seeding Aadhaar and bank account details of beneficiaries remain a prerequisite.