Andhra Pradesh’s Public Distribution System: A Trailblazer

This note highlights how the state of Andhra Pradesh stands out as a pioneer in automating the Public Distribution System and has achieved impressive savings in terms of cost.

The automation of the Public Distribution Systemis an ambitious attempt to combat the diversion of food grains intended for low-income households. Among the states that have embarked on this process, Andhra Pradesh (AP) stands out as a pioneer, having achieved impressive cost savings. This Note discusses best practices that will be useful to other state governments addressing similar challenges. This system was quite expensiveand totals to 1,556 million (USD 23 mn) for 28,295 FPSs. However, the resultant savings, which in MicroSave’s estimate, are around 2,250 million (USD 33 mn) per annum have made it a worthwhile investment. The best practices adopted by AP make it a case worthy of emulation by other states. Prioritising both transparency and efficiency, these initiatives ensure that the poor households have access to their entitlements, are not inconvenienced, and save the government huge amounts by checking the diversion of stocks and plugging leakages in the delivery channel. The scheme is also in line with the central government’s Biometrically Authenticated Physical Offtake (BAPO) principle to minimise exclusions.

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