Aadhar usage in Public Distribution System

Published on Friday, November 11, 2016


The Public Distribution System (PDS) in India has grown considerably over the past decade. Recently, Government has decided to link aadhar with PDS.


  • Leakages in PDS with dealer selling the food grains in the external market. 
  • The dealers give less food grains to the actual beneficiaries and pocket the rest. 
  • Corruption in PDS has gone up to 90 percent in some states. 
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The pioneer to plug this leakage in PDS was Chattisgarh State. The PDS system was made transparent through
  • Computerization 
  • Strict control to check leakages through intermediaries in the state. 
This became a successful model and other states followed.

Jean Dreze PDS study

  • The study was conducted in nine states of Chattisgarh, Tamil Nadu, Uttar Pradesh, Jharkhand, Bihar, Odisha, Himachal Pradesh, Rajasthan and Andhra Pradesh 
  • The study reveals that PDS integrated with aadhar system is working efficiently 
  • Nearly 85% of BPL families get their food grains from the PDS on time. 


There are some pitfalls in this approach.
  • The Supreme Court (SC) has ordered Aadhar as not mandatory 
  • Central government is making it mandatory in PDS which is a direct violation of the SC order. 
  • This adoption of POS and Aadhar link will help eliminate only the bogus cards and quantity frauds. 
  • The leakages and corruption will not be plugged. 

Way Forward

  • The success of Direct Benefit Transfer in the case of LPG subsidy has to be extended to the Public Distribution System. 
  • The food grains will be sold at market prices in PDS shops 
  • Subsidies will be transferred to the beneficiary bank accounts like the gas subsidy 
  • Technology based end to end solution in PDS 
  • Leakages will be arrested to a considerable extent by tracking discrepancies through digitalizing PDS information. 


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