DEPARTMENT OF COMMERCE AND MANAGEMENT STUDIES

CALICUT UNIVERSITY

PUBLIC DISTRIBUTION SYSTEM

( AN MIS FOR PLANNING , MONITORING AND CONTROL )

SUBMITTED TO

Dr. P . MOHAN
PROFESSOR
DCMS

SUBMITTED BY

GROUP NO : 3

DIVYA . P
SHIJI.P
SUJISHA . A.S
NITHYA DAS .P
SARASWATHI C.P
WAHEEDHA BEGUM
MUHAMED .C

II SEM M.COM

DATE OF SUBMISSION : 25-02-2010

 CONTENTS

SL.NO PARTICULARS PAGE NO:

1. ABSTRACT 1
2. INTRODUCTION 2
3. ANALYSIS AND DISCUSSION 4
4. SUMMARY AND SUGGESTIONS 9
5.
 1.

ABSTRACT

The Public Distribution System (PDS) is a means of distribution of essential commodities to a

large number of people.. Over the years, PDS has become an important part of Government’s
policy for management of food economy in the country. This case study aims at strengthening
and upgrading the PDS’s functioning through MIS.
A management information system helps in planning and monitoring the distribution of
essential commodities efficiently. In this paper we discuss the proposed reports to be
submitted by the fair price shop and warehouses , feedback reports to convey to a field unit
how its performance compares with that of other field units . This paper also includes
indicators of performance for various subunits of the PDS administrative system and formats
for planning. Incorporation of MIS in reporting system makes the system more transparent,
efficient, effective ,accountable as well as enables prompt and efficient decision making. It
requires the interaction and cooperation of Central and State Department with Food
Corporation of India (FCI), FPS and other related agencies for sharing necessary information.
 2.

INTRODUCTION

Public Distribution system is an integral part of any State's overall food policy. It has been
evolved to reach the urban as well as the rural population in order to protect the consumers
from the fluctuating and escalating price syndrome. PDS means distribution of essential
commodities to a large number of people through a network of FPS on a recurring basis. It is
an important constituent of the strategy for poverty eradication and is intended to serve as a
safety net for the poor whose number is more than 330 million and are nutritionally at risk.
It was introduced By Government of India in 1954 . The PDS provides rationed amounts of :
i) Basic food items ( rice , wheat , sugar , edible oils )
ii) Other non food products ( kerosene , standard cloths )
at below market prices to consumers through a network of fair price shops disseminated over
the country .

OBJECTIVES OF PDS :

i) Maintaining price stability i.e. to put an indirect check on the open market prices of items

ii) Raising the welfare of the poor (by providing access to basic foods at reasonable prices
to the vulnerable population)
iii) Rationing during situations of scarcity
iv) Keeping a check on private trade
v) To attempt socialization in the matter of distribution of essential commodities

PDS with a network of about 4.99 lakh Fair Price Shops (FPS) is perhaps the largest
distribution network of its type in the world and therefore we to look out for the best practices in
this system . An Online MIS system would help in prompt and efficient decision making in
PDS.
 3.
STRUCTURE OF PDS :

MINISTER OF CONSUMER AFFAIRS, FOOD & PUBLIC DISTRIBUTION

↓
MINISTER OF STATE (FOOD AND PUBLIC DISTRIBUTION)
↓
SECRETARY (FOOD AND PUBLIC DISTRIBUTION)
↓
CENTRAL GOVT. AGENCIES ( FCI , STC)
↓
STATE MINISTRY OF CIVIL SUPPLIES
↓
DISTRICT COLLECTOR (STATE)
↓
TALUK OFFICER (DISTRICT)
↓
CIVIL SUPPLIES INSPECTOR
↓
FAIR PRICE SHOPS
↓
RATION CARD HOLDERS

The PDS is under the control of Department of Food and Public distribution . This
department has to ensure food security for the country through timely and efficient
procurement and distribution of foodgrains. This involves procurement of various
foodgrains,building up and maintenance of food stocks, their storage, movement and delivery
to the distributing agencies and monitoring of production, stock and price level of foodgrains.
The focus is on distribution of foodgrains to Below Poverty Line (BPL) families and covering
poor households at the risk of hunger under Antodaya Anna Yojna (AAY), establishing grain
banks in food scarce areas and involvement of Panchayati Raj Institutions in Public
Distribution System (PDS). It requires an efficient information system to perform these
functions efficiently .

The PDS is operated under joint responsibility of the central and the state Governments . The
central Government has taken the responsibility for procurement , storage , transportation and
bulk allocation of foodgrains . The responsibility for distributing the same to the consumers
through the network of Fair Price Shops rests with the State Government .

ANALYSIS AND DISCUSSION

 5

FUNCTIONING OF PDS

The central Ministry of Civil Supplies lays down policy to cover the what commodities to be
sold in different areas , their prices , legislation and bulk allocation of commodities to the state
Governments . The central Government agencies like FCI procures goods from farmers ,
stores them and transports them to convenient locations in states .

Within each state , the State Ministry of Civil Supplies administers the PDS .Its implementation
remains the direct responsibility of the State Government . It allocates the commodities within
the State , identifies families below poverty line, issues ration cards, supervises and monitors
the functioning of FPS .The Food and Civil Supplies Department of the State Government is
mainly entrusted with the task of monitoring PDS in the state .Within each State there are
district and further within districts , Taluks . In each Taluk there are Fair Price Shops (either
Government owned or licensed) under the control of Taluk Officer and civil supplies Inspector.

The Department of Food and Public distribution formulates the policies relating to procurement
, movement, storage and distribution of foodgrains within states. The allotted quantities are
transferred to the warehouses in the state . The state Ministry of civil supplies allots the
commodities to various Taluks and moves it to state warehouses in districts . From there the
taluk officer allots goods to each FPS in his taluk and moves the goods to the ration wholesale
depot . FPS picks up its allotment of each commodity from the warehouse and finally
distributes it to the ration card holders .
 6

CATEGORIES OF BENEFICIARIES

The citizens can avail the benefit of PDS by obtaining a ration card from the concerned
authorities . A ration card is a document issued under an order or authority of the State
Government , as per the Public Distribution System, for the purchase of essential commodities
from fair price shops from their respective Taluks .

The various categories of card holders are :

1. Above Poverty Line cardholders :

This card is for the households lying above the poverty line . Presently 8 kg of rice and 2
kg of wheat are allotted for them .

2. Below poverty Line cardholders :

This card is for the households lying below the poverty line . Presently 35 kg of rice is
allotted to them .

3. Anthyodaya Anna Yojana ;

This scheme is for the poorest section of the population which is unable to get two
square meals a day on a sustained basis throughout the year and their purchasing
power is so low that they are not in a position to buy food grains round the year even at
BPL rates .

4. Annapurna scheme :

This scheme envisages supply of food grains free o cost to destitute people who are
more than 65 years of age and not receiving old age pension from the Govt .
7

NEED FOR INFORMATION SYSTEM IN PDS :

i) It Facilitates planning in an efficient and timely manner;

ii) It helps in minimizing information overload ;

iii) It encourages decentralization ;

iv) It brings Co ordination among various subunits of PDS administrative system ;

v) It makes control easier and reduces corruption ;

vi) It assembles, process , stores , retrieves , evaluates and disseminates the information

from various subunits ;

 8
MAJOR ISSUES RELATED TO PDS :

The major problems faced by the PDS are as follows :

1. Inadequate supply to the customers

2. Non inclusion of large no : of deserving persons & families ( under BPL category)
3. No regular official estimates of the actual income if households .
4. Low allocation of commodities in relation to monthly needs .
5. Dual pricing for APL and BPL as well as a third price for anthyodaya family . It would
result in distortions , and creates incentives for leakages & other malpractices among
traders and officials . For consumers it creates information problems . When prices are
frequently changed , rolled back and differentiated the consumers become confused .
6. different schemes with different prices & different stock registers makes the
administration more complex
7. Poor quality of grain procured in ration shops . The FCI does not have a system of
Quality checks
8. Large scale diversion of grain from the PDS network Local production poorer than
expected .
9. Low central allocation to state
10. Inability to pick up allotted quantities by the FPS
11. In state allocation mismatched with the actual needs
12. Leakage of supplies by FPS , from warehouse
13. Overstocking of commodities at warehouse
14. High cost of operation
15. Non existence of PDs in certain areas
16. Poor scale of distribution
 9

SUMMARY AND SUGGESTIONS

 10.

PROPOSED ACTIONS TO BE TAKEN BY CIVIL SUPPLIES :

 11

MIS DESIGN FOR MONITORING AND CONTROL OF PDS OPERTIONS :

PROPOSED BASIC REPORTS TO BE SUBMITTED BY THE FAIR PRICE SHOPS

The FPS officials are required to submit report on stock level , total issue ad receipts to the
supply officer on a weekly and monthly basis . Its commonly known by the name “ indent “ .
The format of indent is a follows :

ARD NO :
LICENSE :

DATE OPENING STOCK RECEIPTS TOTAL ISSUE CLOSING STOCK

NOTES : INITIALS :

Apart from the above report the FPS should also submit the following reports for better
information sharing between the various subunits :
1. REPORT ON QUALITY OF COMMODITIES PROCURED FROM RATION
WHOLESALE DEPOT :
It shall include the details of quality of the goods and should b submitted monthly .
 Sl no Commodity Date of procurement Category (standard ,
substandard , poor)

12

2. REPORT ON STOCK LEVEL AT FPS :

It shall include the details of stock level at the FPS like how much quantity is presently
at the shop , volume of stock consumed , daily requirements etc. It would help in better
planning . It should be submitted on a monthly basis .

3. REPORT ON PERFORMANCE OF FPS :

It shall performance level of the shop in terms of transactions carried out and the no of
cardholders served and by making a comparative study among various months .

4. REPORT ON NO: OF CARD HOLDERS :

It shall include the details of the cardholders like the no: of APL , BPL , AAY cardholders
Etc.

PROPOSED BASIC REPORTS TO BE SUBMITTED BY WAREHOUSES :

The warehouse authorities should submit the following reports to the officials concerned :

1. REPORT ON NO: OF FPS HANDLED :

It shall include the details regarding no: of FPS served by the warehouse, no; of
cardholders in those FPS .

2. REPORT ON STOCK LEVEL :

It shall include the details of stock at the godown and the volume of commodities
issued , future requirements of goods , receipts during the month ,volume of commodity
damaged or perished , minimum level of stock required during a month etc. It would
help to keep a check on leakage of commodities from the warehouse as well as reduce
overstocking .
3. REPORT ON TRANSPORT FACILITY :
It shall include the details regarding present transport facilities used by the warehouse
for transporting goods to various FPS , its efficiency , no: of vehicles used , repairs and
maintenance of the vehicles , delivery time , delay , damage to goods in transit , etc.

13

4. REPORT ON STORAGE FACILITIES :

It shall include details of volume of space required to store commodities , existing
safety measures , arrangement of commodities , no: of workers engaged in warehouse
, volume of commodities damaged ,etc. It should b submitted on a monthly basis .

5. REPORT ON QUALITY CONTROL MEASUREMENTS :

It shall include the details of existing quality control measurements undertaken to
ensure quality and safety of the commodities in the warehouse and problems faced in
storage of goods as well as suggestions for further new quality control measures .

All the above reports should be submitted in a timely manner so as to provide information
at the right time. This would in turn prove to be very useful in decision making , planning
and controlling of PDS .
 14

INDICATORS OF PERFORMANCE FOR VARIOUS SUBUNITS OF THE PDS :

The indicators of performance for various subunits of the PDS administrative system are as
follows :

1. FOR STATE & CENTRAL MINISTRY OF CIVIL SUPPLIES :

SL
NO: INDICATORS OF PERFORMANCE

1. NO : OF TALUK SUPPLY OFFICES

2. NO: OF FPS HANDLED : URBAN & RURAL

3. NO: OF CEREAL UNITS

4. NO: OF SUGAR UNITS

5. NO: OF NON FOOD ITEMS UNITS

6. NO: OF LICENSED SHOPS OF KEROSENE OIL

7. NO: OF HOUSEHOLDS THAT HAVE RATION CARD

8. NO: OF WAREHOUSES

9. NO: OF QUALITY CONTROL LABORATORIES

2. FOR WAREHOUSES / RATION WHOLESALE DEPOT :

 SL
NO : INDICATORS OF PERFORMANCE

1. QUANTITY OF FOOD ITEMS STOCKED

2. QUANTITY OF NONFOOD ITEMS STOCKED

3. PERCENTAGE OF COMMODITIES OVERSTOCKED

15

4. NO : OF PDS / FPS HANDLED

5. PERCENTAGE OF COMMODITIES DAMAGED

6. NO : OF COMMODITIES STOCKED

3. FOR FAIR PRICE SHOPS / RETAIL RATION DEPOTS :

SL NO : INDICATOR OF PERFORMANCE
1. NO: OF CARDHOLDERS - APL , BPL , AAY

2. NO : OF FOOD ITEMS HANDLED

3. NO: OF NON FOOD ITEMS HANDLED

4. NO : OF HOUSE HOLDS HAVIMG RATION CARDS

5. NO ; OF BPL & AAY CARDHOLDERS

6. VOLUME OF STOCK PROCURED

7. WEEKLY & MONTHLY STOCK BALANCE

8. VOLUME OF RECEIPTS

9. VOLUME OF TOTAL ISSUE

16

CONCLUSION
To make PDS more effective & efficient, training is also provided to FPS owners, members
of NGOs, PRIs, village/city vigilance
Essential to the acceptance of the system were several training sessions for
administrators at various levels

REFERENCES