Address rising food bill, revisit PDS rates: Survey

There is a need to address the rising food subsidy bill, and the government needs to 'revisit' the subsidised rates at which foodgrains are distributed through ration shops, the Economic Survey said.

Foodgrains via ration shops are supplied at highly subsidised rates of Rs 3 per kg for rice, Rs 2 per kg for wheat and Rs 1 per kg for coarse grains through Public Distribution System (PDS) as per the National Food Security Act (NFSA).

"With a large share of poor people, maintaining food security is still a challenge. The rates fixed under the NFSA initially for a period of three years have not been revised since 2013, resulting in burgeoning food subsidy. The rates under NFSA and the coverage need to be revisited," the Survey said.

The food subsidy bill has increased from Rs 1,13,171.2 crore in 2014-15 to Rs 1,71,127.5 crore in 2018-19, it said adding that the reasons for widening of the food subsidy have been many.

While the economic cost has increased, the central issue price (the rate at which grains are sold in ration shops) for NFSA beneficiaries has not been revised from Rs 200 per quintal in case of wheat and Rs 300 per quintal in the case of rice.