Ration card reform

RIGHTS/ GOVERNANCE/ ECONOMY

Topic:

• GS-2: Government policies and interventions for development in various sectors
• GS-3: Indian Economy and issues relating to planning, mobilization, of resources

Ration card reform

Context: Recently, the Supreme Court directed all states and Union Territories to implement the One Nation, One Ration Card (ONORC) system, which allows for inter- and intra-state portability, by July 31. 

Did You Know?

• Portable welfare benefits mean that a citizen should be able to access welfare benefits irrespective of where she is in the country. 
• In the case of food rations, the idea was first mooted by a Nandan Nilekani-led task force in 2011. 
• 45.36 crore people or 37% of the population is that of migrant labourers.

What is One Nation One Ration Card?

• The scheme seeks to provide portability of food security benefits all across the nation.
• Families who have food security cards can buy subsidized food from any ration shop in the country. 
• For instance, a migrant worker from, say, Basti district of Uttar Pradesh will be able to access PDS benefits in Mumbai, where he or she may have gone in search of work. While the person can buy foodgrains as per his or her entitlement under the NFSA at the place where he or she is based, members of his or her family can still go to their ration dealer back home.
• Ration cards should be linked with Aadhar Number to avail this service. 
• It was started in mid-2019 with pilot project in 4 states and was supposed to be rolled-out across country by June 2020 but got delayed due to Pandemic.

Taking States on board

• To promote this reform in the archaic Public Distribution System (PDS), the government has provided incentives to states. 
• The Centre had even set the implementation of ONORC as a precondition for additional borrowing by states during the Covid-19 pandemic last year. 
• At least 17 states, which implemented the ONORC reform, were allowed to borrow an additional Rs 37,600 crores in 2020-21.

How does ONORC work?

• ONORC is based on technology that involves details of beneficiaries’ ration card, Aadhaar number, and electronic Points of Sale (ePoS). 
• The system identifies a beneficiary through biometric authentication on ePoS devices at fair price shops. 
• The system runs with the support of two portals —
  • Annavitran Portal– maintains a record of intra-state transactions — inter-district and intra-district
  • Integrated Management of Public Distribution System (IM-PDS) – records the inter-state transactions.
• When a ration card holder goes to a fair price shop, he or she identifies himself or herself through biometric authentication on ePoS, which is matched real time with details on the Annavitaran portal. 
• Once the ration card details are verified, the dealer hands out the beneficiary’s entitlements. 

What factors led to the launch of ONORC?

• Earlier, NFSA beneficiaries were not able to access their PDS benefits outside the jurisdiction of the specific fair price shop to which they have been assigned. 
• The government envisioned the ONORC to give them access to benefits from any fair price shop. 
• Full coverage will be possible after 100% Aadhaar seeding of ration cards has been achieved, and all fair price shops are covered by ePoS devices (there are currently 4.74 lakh devices installed across the country).
• ONORC was launched in August, 2019. Work on ration card portability, however, had begun in April 2018 itself, with the launch of the IM-PDS. The idea was to reform the PDS, which has been historically marred by inefficiency and leakages.
• ONORC was initially launched as an inter-state pilot. However, when the Covid-19 pandemic forced thousands of migrant workers to return to their villages last year, a need was felt to expedite the rollout.
• As part of its Covid economic relief package, the government announced the national rollout of ONORC in all states and Union Territories by March 2021.

What has been the coverage so far?

• Till date, 32 states and Union Territories have joined the ONORC, covering about 69 crore NFSA beneficiaries. Four states are yet to join the scheme — Assam, Chhattisgarh, Delhi and West Bengal.

• According to the Union Ministry of Consumer Affairs, Food and Public Distribution, about 1.35 crore portability transactions every month are being recorded under ONORC on an average.
• Almost 19.8 Crore portability transactions have been recorded during the COVID-19 period of April 2020 to May 2021 itsel
• While inter-state ration card portability is available in 32 states, the number of such transactions is much lower than that of intra-district and inter-district transactions

Why have these four states not implemented it yet?

There are various reasons.

•  For instance, Delhi is yet to start the use of ePoS in fair price shops, which is a prerequisite for the implementation of ONORC. 
• In the case of West Bengal, the state government has demanded that the non-NFSA ration card holders — ration cards issued by the state government — should also be covered under the ONORC

Connecting the dots:

• One Nation One Election
• One Nation One Gas Grid