Free food grains to the poor: What Centre’s scheme aims to achieve

The Centre has announced free food grains to 81 crore poor people under the National Food Security Act. This will include rice, wheat and coarse grains. What is the significance? Is it different from the Pradhan Mantri Garib Kalyan Anna Yojana?The National Food Security Act (NFSA) has been in place since 2013. About 81 crore identified beneficiaries are entitled to get food grains at an extremely cheap rate — rice at Rs 3, wheat at Rs 2 and coarse grain at Re 1 per kg. When Covid hit the country, the government came out with the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY). Under this, the government gave 5 kg of food grains to each person. As the impact of Covid subsided, economic activities improved. But the government’s stock of food grains was depleting. The government has now done a balancing act. It has merged the PMGKAY with the NFSA. The new scheme will remain applicable for a year. What are the political implication of the announcement? Every decision by any government has to do with politics. Just before the elections in Gujarat and Himachal Pradesh, the government had extended the PMGKAY for three months, that is, the end of December this year. This new decision is obviously aimed at the next elections. It will send the message that this government is pro-poor. Earlier, K V Thomas, who was a minister in the UPA government, had said that a mechanism should be devised to ensure that states should not get credit for the food security schemes primarily sponsored by the Centre. When Ramvilas Paswan was the minister, he also said the same thing. The announcement has put an end to the entire debate.Will private players profit? When farmers get a better price in the market, they will obviously sell their food grains to private players. That is what minimum support price means. Farmers have the right to do so. Last year, procurement was less, the prices were up primarily because of the war in Ukraine. Let's hope that next year when the next procurement season starts in April, there will be some solution some relief. In that situation, there is a possibility that the government will procure more wheat from farmers. Rice is already being procured at a fast pace by the government. If farmers produce more and there is more availability in the market, there will not be a problem for the government to procure more food gain.Can the government sustain this model for long?The entire debate is about subsidy. How much is the government spending from our coffers. Under the NFSA, in which people are getting subsidised food grain, the government was spending almost Rs 1.5 lakh crore. Under PMGKAY, government was paying Rs 1.6 to 1.7 lakh crore. If you put that together, it comes to around Rs 3 lakh crore. The subsidy is a huge burden on the government. Under the new scheme, the burden will come down to Rs 2 lakh crore. So the government is saving money and also ensuring that people get free food grains and there is no crisis. Audio production: Prateek Kapoor