Decline of the Kerala PDS

Until a decade ago, owning a ration shop in Kerala was a status symbol. Abdul Rehman, a retail ration dealer for more than two decades, always enjoyed a special status in Ambayathode village of Kozhikode district, with over 1,700 ration card holders on his roll. Rehman was one of the 14,236 retail dealers who catered to close to 91 per cent of the state population in a model public distribution system. According to government officials, there was one ration outlet within two km radius of every household. But that was then.

Rahman committed suicide last year, unable to cope with dwindling off-takes from his shop and mounting debt. The system was hit by the centre's Targeted Public Distribution System (TPDS) launched in 1997, which focussed only on families living below the poverty line (BPL). On an average, ration shops used to sell more than 185 million kg of food grains every month. Since the introduction of the new system, the off-take of rice decreased from 155 million kg per month to 50 million kg in 2002. Even the sales turnover of the Kerala Civil Supplies Corporation Ltd fell from Rs 630 crore during 1999-2000 to Rs 406 crore during 2001-2002. The drop is attributed mainly to the declining sale of PDS items.

Owning a ration shop has become less viable. Many are in the business with the hope that the situation will improve. The state government has attached about 1,000 ration outlets. The Planning Commission in its evaluation of TPDS in 2005 noted: "In view of unmanageably rising transport and labour charges coupled with the fast-reducing off-take, many fair-price shop owners want to surrender their licences.'

The central government recognizes only 25 per cent of Kerala's 3.18 crore population as belonging to the BPL category, while the state government considers 42 per cent. Kerala bears the subsidy burden for the rest of the 17 per cent.

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