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The empowered Group of Ministers on food security, scheduled to meet tomorrow, will have to walk a tightrope in trying to fulfill the 'food for all' promise made by the Congress party in its election manifesto. Not only is the government hamstrung by its inability to sustain procurement levels of of 50 million tonnes of foodgrains every year required to feed all poor — below poverty line (BPL) and above poverty line (APL) households — it is also increasingly bothered about the financial burden this entails.According to government estimates, providing 35 kgs of wheat or rice to 8.1 crore BPL households itself will entail an additional Rs 13,919 crore subsidy burden, taking the total food security bill to 53,676 crore. This, for the record, assumes that there is no Central government subsidy to APL households, many of whom are ration card holders and in fact, provided grains at subsidised rates by respective state governments.There are far too many issues the eGoM seems to be grappling with — from arriving at estimates of BPL households as on date and the number of members per BPL household to pricing foodgrains for APL families such that the incentive for diversion of foodgrains is minimised. While it is likely that ministers will arrive at a consensus on these issues, the real task of the government will be to overhaul the public distribution system (PDS) in a not-so-distant future and eventually replace it with a smart card system.First things first. Though there is a broad consensus within a section of the government that the Tendulkar Commitee's recommendation on BPL definition, the dilemma is whether to accept its estimate of BPL households at 7.4 crore as on March 2005 or update it to March 2011 population, taking the number up to 8.1 crore. The total grain requirement in the two scenarios is 31.1 million tonnes and 33.9 million tonnes, respectively. Besides, the EGoM is expected to delve on the possibility of converting the monthly entitlement from per family (35 kg) to a per member basis (6 kg).The second difficult issue is meeting the needs of APL households, estimated at some 11.52 crore. If they are to be provided 35 kgs of foodgrains, similar to BPL, the annual grain requirement for APL families alone is 48 million tonnes. But the government reckons that this is not sustainable with the level of procurement unlikely to remain as buoyant as it has been over the past three years, for a long period. Further, should they be eligible for subsidies similar to that for BPL families. To protect the fisc, the government is considering pricing APL foodgrain closer to the open market levels such that the offtake is limited. If it is priced at, say, 75 per cent of the market rate, then the annual offtake is restricted to 12 million tonnes.Finally, the most difficult part is PDS revamp to contain pilferage. The Centre plans to issue smart cards to BPL households and credit their accounts to the extent of the subsidy they are entitled to. While this will help diversion of foodstocks, what the Centre plans is broadbase the food basket by allowing purchase of other edible items like pulses, edible oils, milk and eggs from designated or ration shops. This will empower the beneficiary to buy products other than grains.
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