An Empirical Analysis on Food Subsidy in India

The Public Distribution system is India’s largest poverty alleviation programme and it is mainly depends with the subsidy given by the government of India. The subsidy is provided to Food Corporation of India, which is the main instrument of the Government of India for procurement and distribution of wheat and rice under Targeted Public Distribution System and other welfare schemes and for maintaining the buffer stock of food grains as a measure of food security. This paper makes critical review on the flow of food subsidy given by the Government of India to the Food Corporation of India and how strengthens the poverty alleviation programme by using Government subsidy.

Effect of Food Subsidies on Micronutrient Consumption

In this article, we study the effect of an exogenous increase in wheat and rice price subsidy to poor families resulting from a targeted food price subsidy programme in India called the Targeted Public Distribution System (TPDS) on micronutrient intake in low-income families. Descriptive results show that wheat and rice have one of the lowest micronutrient density scores, suggesting that these are poor suppliers of micronutrients. Empirical analysis suggests that the increase in monthly per capita subsidy amount of ₹15–18 resulting from the TPDS expansion lowered calcium intake by 12–14 per cent and had negligible to small (often negative) effects on the consumption of most micronutrients.

A Study on Factors Influencing Level of Utilisation of Public Distribution System with Special Reference to Pollachi Taluk

Government of India provides food (ration) at highly subsidized rates to the poor people through public distribution system (PDS). Cooperation, food, and consumer protection department of the Government lays down the policy for public distribution system. Public distribution system in Tamil Nadu is a universal system to cover all the needy families by supplying rice at a price much lower than the BPL price fixed by the Government of India under the targeted public distribution system. Also it ensures food security to all citizens, particularly poor people, by making essential commodities of good quality available at affordable prices every month, through a chain of shops called ration shops (or Fair Price shops). The study aims to find out the utilization level of PDS by the public for which 350 ration cardholders belonging to Pollachi Taluk (Coimbatore Dist., Tamil Nadu, India) were surveyed and the data were collected through questionnaire (literates) and interview schedule (for illiterates). It was found that cardholders have moderate satisfaction only and it was suggested to improve the working of PDS by opening the shops on Sundays, quantity of few items can be increased during festival time, etc. The result of the study is based on the opinions given by the cardholders of Pollachi taluk. It might not be applicable to other places.

Does food subsidy affect household nutrition?

Purpose – Indian households having the below poverty line (BPL) ration card receive rice, wheat, sugar and kerosene from the Indian Targeted Public Distribution System (TPDS) at subsidized rates. The paper uses the National Sample Survey Organization's consumption expenditure survey for the 61st round to study the causal effect of the BPL ration card on BPL households' calorie consumption. The paper aims to discuss these issues. Design/methodology/approach – This causal effect is estimated by comparing per-capita-per-day calorie consumption of the BPL households having BPL card with that of a matched counterfactual BPL household from the same state not having BPL card, using stratified propensity score matching. Findings – The BPL ration card was found to increase calorie consumption from cereals and decrease calorie consumption from non-cereal food items without affecting the overall calorie consumption of household. Thus, TPDS induces households to consume more cereals and less non-cereal without significantly changing the overall calorie consumption. Research limitations/implications – The research methodology controls for selection bias due to observable variables. Further, research needed to devise experimental set up to control for the selection bias due to unobserved variables. Originality/value – The paper uses the targeting error in identifying BPL households in TPDS as a quasi-experiment set up to study the causal effect of the BPL ration card.