Five-year extension for free ration: The numbers behind the food security programme

The PMGKAY was introduced in 2020 during the Covid-19 pandemic to provide 5 kg free foodgrains to eligible ration card holders under the National Food Security Act, 2013 (NFSA). The NFSA, introduced by the UPA government at the time, entitled beneficiaries to receive subsidised foodgrains (at Rs 3, Rs 2 and Rs 1 per kilogram of rice, wheat and coarse grains, respectively) through the Targeted Public Distribution System (TPDS).

In late 2022, ahead of the Gujarat and Himachal Pradesh Assembly polls, the PMGKAY was extended until December 2022 and then for another year until December 2023, merging it with the NFSA. With the scheme nearing its expiry, the government has again extended it, this time for another five years.

Scope of PMGKAY

The PMGKAY covers two kinds of ration card holders under the NFSA – for the Antyodaya Anna Yojana (AAY) and Priority Households (PHH). The NFSA covers about 20 crore families, or a total 81.35 crore beneficiaries, who account for two-thirds of the country’s population – 50% for urban and 75% for rural.

While the AAY households are entitled to 35 kg of foodgrains per month irrespective of the number of family members, the priority households get foodgrains depending on the number of family members (each member 5 kg per month).

The PMGKAY’s free ration was in addition to this.

In the financial year 2022-23, AAY families had annual savings of Rs 2,705 crore and PHH families had annual savings of about Rs 11,142 crore.

Allocations under PMGKAY

Since the scheme was introduced in 2020, the government has allocated 1,118 lakh metric tonnes of foodgrains from its central procurement pool at a cost of Rs 3.9 lakh crore.

In January this year, the PMGKAY was merged with the NFSA, providing all ration for AAY and PHH families for free and eliminating the additional provisions introduced during the pandemic.

“It has been merged (with the NFSA). The free portion of that scheme has been added to the NFSA. Now, the entire quantity of 5 kg and 35 kg under the NFSA would be available free of cost. There is no need for additional foodgrains,” said Union Food Minister Piyush Goyal

The discontinuation of the separate PMGKAY provisions came amid depleting stocks of foodgrains in the central pool and saved the government an estimated Rs 15,000 crore every month.

The government used to receive Rs 13,900 crore in a year from selling subsidised foodgrains under the NFSA. With this additional outgo, the total food security bill rose to about Rs 2.87 lakh crore in 2022-23.

In this year’s budget, the government has allocated just under Rs 2 lakh crore on all food subsidies, a significant decline from previous years. During the pandemic, the food subsidy outlay had peaked at Rs 5.41 lakh crore.