The presentation was part of the Food Security in India: the Interactions of Climate Change, Economics, Politics and Trade workshop, organized by IFPRI-CUTS on March 11 in New Delhi, India. The project seeks to explore a model for analyzing food security in India through the interactions of climate change, economics, politics and trade.
2. Five common misconceptions about
NFSA
1 “D ’t d thi f t iti ” b t it d1. “Doesn’t do anything for nutrition”: but it does
include maternity entitlements & ICDS
2 “These schemes don’t work” Recent evidence2. “These schemes don’t work”: Recent evidence
shows a revival
3 “It is anti farmer”: a large part of food subsidy3. It is anti‐farmer : a large part of food subsidy
goes to farmer as support prices!
4 “it is unaffordable”: It is approx 1% of GDP4. it is unaffordable : It is approx 1% of GDP
5. “Grain requirements are too high”: NFSA
requires same level of procurement as seen inrequires same level of procurement as seen in
past few years
3. Revival: Evidence and ExplanationsRevival: Evidence and Explanations
id f i l• Evidence of PDS revival
– Zero purchase households has declined
– Leakages have declined
– Poverty impact is substantialy p
• Time to junk the Planning Commission (2005)
report! See Himanshu and Sen (2013)
instead!
4. Corruption control: some evidenceCorruption control: some evidence
Diversion of PDS grain in selected states (2004-5, 2009-10 and 2011-12)
85.2
90.0
100.0
Diversion of PDS grain in selected states (2004 5, 2009 10 and 2011 12)
76.3
70.0
80.0
51.8
46.3
42.4
40 0
50.0
60.0
30.2
19.9
20 0
30.0
40.0
10.4 10.2
0.0
10.0
20.0
0.0
JH OR Chh
Source: Calculated from Monthly foodgrains bulletin and National Sample Survey data from 2004-5 and 2009-10.
5. Bihar Chhattisgarh
Proportion of BPL households who did not get any
foodgrains from the PDS in the last 3 months (%)
35 0
foodgrains from the PDS in the last 3 months (%)
Proportion of BPL respondents who said that they
‘normally’ get their full PDS entitlements (%)
18 97
Proportion of BPL respondents who agree with the
entries in their ration cards (%)
25 94
Proportion of BPL households who skipped meals 70 17Proportion of BPL households who skipped meals
in the last three months (%)
70 17
Proportion of BPL households who would support 54 2
the PDS being replaced with equivalent cash
transfers (%)
‘Poverty-gap index’ of rural poverty 2009–10bPoverty gap index of rural poverty, 2009 10
(%)
Without implicit subsidy
14.4
13.8
16.3
9.9
With implicit subsidy
Percentage reduction
13.8
4
9.9
39
Drèze and Khera (2013), Rural Poverty and the PDS, Economic and Political Weekly
6. Explanations for the revivalExplanations for the revival
d id f• Demand side factors
– Expanded coverage, reduction in price,
diversification
• Supply side factorspp y
– Computerization, management of shops, official
commissions, door‐step delivery, regularity and p y g y
predictability
• See Khera (2011) for more
7. NFSA: Implementation Challenges (1)NFSA: Implementation Challenges (1)
• Identification of households
– Criteria
• Inclusion vs. Exclusion approach (e.g., Odisha,
Chhattisgarh)
• 1997 or 2002 BPL lists (e.g., Rajasthan)
– Procedure:Procedure:
• SECC data based survey or self‐declaration
• New cards vs old cardsNew cards vs. old cards
8. NFSA: Implementation Challenges (2)NFSA: Implementation Challenges (2)
• Entitlements: Per capita or per household?
– Per capita: Better for larger families, definition of
“household”household
– Per household: Clarity of entitlements, hassles
and harassment , disruptive transition?
9. NFSA: Implementation Challenges (3)NFSA: Implementation Challenges (3)
• Integration with UID: Claims
– Corruption control: Yes, it’s a problem, but how p , p ,
much can UID help?
– Inclusion: Massive exclusion but what is theInclusion: Massive exclusion, but what is the
source of exclusion?
Portability: Desirable but is UID necessary to– Portability: Desirable, but is UID necessary to
achieve it? No.
10. Leakages Inclusion and PortabilityLeakages, Inclusion and Portability
• Leakages: Technology? Yes. UID? No.
– Computerization alone helps a lotp p
• Inclusion: Duplicates/ghosts are a problem,
but exaggeratedbut exaggerated.
– Mis‐classification, UID can do nothing
• Portability: Requires fixing supply chain
management CORE PDS in Chhattisgarhmanagement. CORE PDS in Chhattisgarh