Biometrics can increase efficiency and reduce waste in the Public Distribution System (PDS) in India
The New Government has promised to bring efficiency in it’s functioning. We Indians, who have known and experienced most government departments to be inefficient and corrupt, have high hopes that the new government will deliver on this promise. It is high time that we make all efforts to reduce “G-waste”.
Of course, apart from a mindset change and simplified processes that the government will introduce in public sector organizations, technology will play an important role in helping the Modi government increase transparency, efficiency & accountability.
Lets take the example of food & essential commodities distribution to understand the role that technology can play, as this affects a significant portion of our population.
The government of India, along with the State governments, runs the PDS scheme, wherein each family below the poverty line is eligible for a specific quantity of subsidized essentials e.g. 35 kgs of rice or wheat every month, while a household above the poverty line is entitled to 15 kgs of food grain on a monthly basis. This is a mammoth task that involves nearly 500,000 Fair Price Shops (FPSs) spread across the length and breadth of the country. Through the FPSs, the government distributes subsidized food grains and commodities worth over Rs. 30,000 crores annually to over 160 million families.
The Indian PDS is accused of being one of the most inefficient, and often accused of being extremely corrupt and pilferaged, systems in the world. Food grains and other essential commodities meant for the poor are often unfairly usurped by middlemen and sold in the open market at prevailing market prices. According to a report by Bloomberg, in just one state of Uttar Pradesh, over US$ 14.5 billion worth of subsidized supplies meant for the poor was looted or diverted in the last decade. The major reason for this rampant malpractice is that the identification of recipients and the transactions are manual, and can therefore be manipulated by fraudsters. Additionally, there are multiple agencies involved, with very little digitization to manage duplicities and fraud claims.
As a result, the intended beneficiaries most often do not receive the subsidized food grains.
It is obvious that we need to deploy technology in significantly enhancing the efficiency of the PDS system. For this purpose, a massive modernization drive is required. Computerization of the entire food supply chain and digitizing the database of actual beneficiaries will remain the major stepping-stones on which PDS can become successful.
In the last several years, that the digitization of the beneficiaries has been achieved in a number of states, but since the actual transactions have never been performed electronically (aside from a number of small pilots), the database is not used and deployed and obviously suffers from being dated and prone to errors. As we all know, any large database is self-correcting – the more you use it, the better it gets.
For transparent transactions, we need to have two fundamental essentials. One, that the beneficiary is “present”, and the second that the transaction is electronic. This will ensure that ONLY the beneficiary avails of the subsidy, and that there is no diversion.
A large number of beneficiaries are illiterate and poor and open to exploitation. ONLY biometric “presence” serves them. If they are personally not present, at least the diversion will not occur.
Using biometric systems for managing and transacting identities in the PDS by integrating information at the POS level will have the potential to save costs, ensure goods and services reach the intended users and make the public program extremely accessible.
The Gujarat government has already proven that ICT in PDS can improve accountability and transparency. They use an innovative model of service-delivery – the Biometric Bar-coded PDS Coupon system for the Targeted Public Distribution System in the state. Now, the Delhi Food, Supplies and Consumer Affairs department is ready to implement biometric authentication (point of sale (PoS) devices) in each of the capital’s 2,772 fair price shops (FPS). The project also aims to prevent pilferage of food grains and to sell ration items to beneficiaries only on biometric authentication.
Transparent and efficient (technology driven) solutions are often wrongly seen as costly. In fact the ROI is easy to compute, and extremely attractive. What is needed is an interoperable, scalable, technology solution that is not vendor dependent, but “business case” driven.
On an average a FPS transacts food worth Rs. 2000 each day. Just a target saving of 5% on the food distribution efficiency is sufficient to pay for the required technology at the shop. We can well imagine that this is highly achievable.
I believe that given the vast network of the PDS in India and the rightful requirement of its beneficiaries, it will prove highly beneficial when the PDS is digitized through Biometrics. Not only will the country’s BPL population be given their rightful share of essential commodities, it will also help in making the ROI more relevant and precise.
Sanjeev Shriya 