FOOD SECURITY BILL

Group 9
Hamdan Shaikh
Savio DSouza
Achim Braganca
Sanheeta Naik
Deepti Coutinho
Shradha Patil

Introduction:
The Indian National Food Security Bill, 2013 was signed into law
September 12, 2013. This law aims to provide subsidized food grains to
approximately two thirds of India's 1.2 billion people. The Indian Ministry
of Agriculture's Commission on Agricultural Costs and Prices has referred
to the Bill as the "biggest ever experiment in the world for distributing
highly subsidized food by any government through a rights based
approach. The Bill extends coverage of the Targeted Public Distribution
System, India's principal domestic food aid program, to two thirds of the
population, or approximately 820 million people. The government has
already budgeted 900 billion rupees for the scheme in the current fiscal
year ending March 2014.

Who is entitled to food security?

The bill categorises the population into an Antyodaya Anna Yojana (AAY)
group, a priority group and an excluded category. The excluded category
is retained at 25 per cent of the rural and 50 per cent of the urban
population. The AAY category will be as per existing norms (about 10 per
cent of all households).
As compared to earlier versions, the bill does not include entitlements for
starving, destitute and homeless persons although pregnant women and
children continue to be included as beneficiaries.

The advantages of the bill are

The bill provides different entitlements to groups. The poorest of the

poor (the AAY group) will receive 35 kg of food grain/family/month
while others (the priority group) will receive 5 kg of food
grain/person/month.
The states are responsible for determining eligibility.
Pregnant women and lactating mothers are entitled to a nutritious
"take home ration" of 600 Calories and a maternity benefit of at
least Rs 6,000 for six months.
Children 6 months to 14 years of age are to receive free hot meals
or "take home rations".
The central government will provide funds to states in case of short
supplies of food grains.
The current food grain allocation of the states will be protected by
the central government for at least six months.
The state governments will provide a food security allowance to the
beneficiaries in case of non-supply of food grains.

The Public Distribution System is to be reformed.

The eldest woman in the household, 18 years or above is the head
of the household for the issuance of the ration card.
There will be state- and district-level redress mechanisms.
State Food Commissions will be formed for implementation and
monitoring of the provisions of the Act.

The disadvantages of the bill are

The food security bill will lead to a higher government expenditure

which means a higher fiscal deposit for which the government will
have to increase the borrowing rate The private sector (be it banks
or companies) in order to compete with the government for savings
will have to offer higher interest rates. This means that the era of
high interest rates will continue, which will not be good for economic
growth.
The very low prices of the subsidized food will distort the market
and farmers who cant sell to the government-assured program will
lose out on the open market because prices will be forced down.
Hence the person who is not poor at present but will become poor in
days to come.
The scheme does not define the beneficiaries properly. The bill says
that States will provide the list of the poor but they have no such
records. So, whether it will reach the right persons is hypothetical.
the total estimated annual food grains requirements will be 61.23
million tones and is likely to cost Rs.1,24,724 crore. Given the rising
costs of the scheme and rising population, its sustainability is under
question. This is a mega program and will require a huge food
subsidy. The cost of it will go up from 0.8% of Gross Domestic
Product to around 1.1% of GDP. This is a serious increase in a
situation where the government does not have enough resources as
it is.
The legislations emphasis on food grain causes inflation to rise
even higher in other agri-commodities, such as vegetables and dairy
products that have been the site of high food inflation in the past.

Impact of the Bill:

The annual burden of food subsidy is expected to rise to about Rs

1.30 lakh crore from the budgeted Rs 90,000 crore this year. "It will
raise future subsidy expenditure commitments, hindering the
government's ability to consolidate its finances

 Indias inflation risk remains high and a slowdown in revenue

collections and higher spending on subsidies may make it
challenging for the government to achieve the fiscal deficit target of
4.6 per cent of the Gross Domestic Product (GDP) this financial year
(2011-12).

Conclusion:
The decision of who gets it and who doesnt is going to be decided
at a later point which means there might be certain qualification
criteria, or documentation requirements for the people to avail this
facility. Making documentation compulsory can be an issue as the
real motive of the Food Security Bill is to provide food for the poor
but the homeless and beggars wont actually have any proof of their
existence or home address in order to avail the benefit. Moreover
the middle class will forge their papers as if they were below the
poverty line and thus qualify for the subsidy. And realizing the
potential, some of the ultra-rich, too, might create a system of nonexistent people with fake names and fake addresses in order to
obtain the cheap food and sell it on the market elsewhere.
In order to make sure that the Bill benefits the poor the Government
actually have to actually see that the food leakage does not take
place.