The Hindu Newspaper Analysis

Editorial Topic : Revamping of PDS through the Food Security Act

 GS-3 Mains Exam : Economy

Revision Notes

Context

• The implementation of the National Food Security Act (NFSA) 2013 has led to significant Public Distribution System (PDS) reforms, reducing leakages in grain distribution.
• In 2011-12, PDS leakages were as high as 41.7% nationally, highlighting inefficiency in the system before reforms.

Improvements in PDS

• State-level reforms: Some states implemented PDS reforms even before the NFSA, drastically improving performance.
  • Bihar: Leakages dropped from 91% to 24% between 2004-05 and 2011-12.
  • Chhattisgarh: Leakages reduced from 52% to 9% over the same period.
  • Odisha: Leakages went down from 76% to 25%.
• With the implementation of the NFSA in 2013, the expectation was for similar reforms to be adopted across other states.

NSS Data: Decline in Leakages

• The NSS Household Consumption Expenditure Survey (HCES), conducted in 2022-23, showed that leakages had fallen to 22% after the NFSA reforms.
• A significant reduction compared to earlier years, indicating the success of these reforms.

Defining and Estimating Leakages

• Leakages: The gap between the food grains released by the Food Corporation of India (FCI) and what reaches the consumers.
• Methodology: Leakages were estimated by comparing household PDS purchases (from NSS data) with the grain offtake data from the Food Ministry’s Monthly Food Grain Bulletin.
• PDS distribution: Ration card holders received five kg of grain per person (Priority households) or 35 kg per month (Antyodaya households) under NFSA from August 2022 to July 2023.

Underestimation of Leakages

• Expanded PDS by states: Many states, such as Chhattisgarh, have expanded PDS beyond NFSA mandates by contributing state funds to provide additional grains.
  • Example: Chhattisgarh’s 2012 Food Security Act expanded the PDS to include more beneficiaries through local procurement.
  • Official estimates show all-India leakages at around 18%, but this figure may be understated due to under-accounting of state contributions.
  • Adjusting for state contributions raises the leakage estimate to 22%.

NFSA’s Impact on PDS Coverage

• PDS coverage pre- and post-NFSA:
  • In 2011-12, prior to the NFSA, less than 50% of households had ration cards, and only 24% of households used the PDS.
  • Post-NFSA, HCES 2022-23 showed that 70% of households were purchasing from the PDS.
  • In states like Chhattisgarh, coverage increased from 21% to 63%, primarily due to the reforms under NFSA.

Shortfall in NFSA Coverage

• NFSA targets: The NFSA aimed to cover 66% of the population (75% rural and 50% urban), but current access is lower.
  • Only 59% of the population is accessing PDS as NFSA beneficiaries, while 70% of households are using the PDS, indicating some non-NFSA beneficiaries.
  • HCES data shows 57%-61% have NFSA ration cards, with around 10% being non-NFSA beneficiaries.

PDS Reforms in Early Reforming States

• Reforms: Key PDS reforms by early reforming states like Chhattisgarh and Odisha included:
  • Lowering PDS prices.
  • Doorstep delivery of food grains.
  • Digitisation of PDS records.
  • Management of PDS outlets by panchayats and self-help groups.
• Decline in leakages:
  • By 2011-12, PDS leakages had reduced significantly in early reforming states. For example, Rajasthan’s leakages in 2022-23 were just 9%, down from higher levels previously.
  • Other states like Jharkhand and Uttar Pradesh have also seen improvements, with leakages down to 21% and 23%, respectively.

Role of Aadhaar in PDS Reforms

• Aadhaar-based Biometric Authentication (ABBA): Some argue that Aadhaar integration led to reduced leakages, but primary data does not fully support this.
  • Studies in Jharkhand found that leakages were already below 20% before ABBA implementation.
  • Surveys in 2017 showed little difference in purchase-entitlement ratios between ABBA and non-ABBA villages, with both at around 93%-94%.

Challenges and Remaining Gaps

• Regional disparities: Some states where PDS traditionally worked well (e.g., Tamil Nadu) have seen an increase in leakages—from 12% in 2011-12 to 25% in 2022-23.
• Census delays: A delayed Census has excluded over 100 million people from the PDS.

• • This, coupled with reliance on outdated data, limits the NFSA’s ability to meet its 66% coverage target.

Conclusion

• The NFSA and PDS reforms have significantly improved the reach and efficiency of the PDS, reducing leakages and increasing coverage.
• During the COVID-19 pandemic, the PDS, along with MGNREGA, formed a critical part of the government’s relief efforts.
• However, challenges remain, including ongoing technological interventions (e.g., Aadhaar-based authentication), delayed Census data, and calls for expanding the basket of food items under the PDS to include pulses and edible oil.

 

 

 

The Hindu Newspaper Analysis

Editorial Topic : India’s Critical Mineral Mission and Africa’s Role

 GS-2 Mains Exam : IR

Revision Notes

Context

• India’s Union Budget 2024-25 announced the Critical Mineral Mission, focused on domestic production, recycling, and overseas acquisition of critical minerals.
• The mission aims to secure critical minerals for sectors like renewable energy and electronics, essential for India’s green transition.

Indo-African Dynamics on Critical Minerals

• Private Sector Involvement:
  • The Mines and Minerals (Development and Regulation) Amendment Bill, 2023 opened six minerals for private sector exploration in India.
  • India’s private players and mining companies are exploring overseas opportunities for critical minerals to ensure a steady supply.
• KABIL Initiative:
  • The Khanij Bidesh India Limited (KABIL), a joint venture of three public sector undertakings, was established in 2019 to secure overseas critical mineral assets.
  • January 2024: KABIL signed a major lithium exploration deal in Argentina for five blocks in Catamarca Province.
• Need for Upskilling:
  • India’s capabilities for critical mineral exploration and processing remain underdeveloped.
  • The country also lacks manufacturing capacity for key components, such as batteries, and needs to invest in upskilling its workforce.

Africa’s Role in India’s Critical Minerals Supply Chain

• Africa’s Resource Richness:
  • Africa holds 30% of the world’s known critical mineral reserves, making it a crucial partner for India’s mineral mission.
• Political and Economic Ties:
  • India has deep historic, economic, and political ties with Africa, supported by a 3 million-strong Indian diaspora.
  • India’s External Affairs Minister, S. Jaishankar, called Africa the “land of the future,” reflecting its growing importance for India’s global priorities.
• Bilateral Trade:
  • In 2022-23, Indo-African bilateral trade reached $98 billion, with $43 billion from the mining and mineral sectors.
• Indian Investment in Africa:
  • India has invested $75 billion in Africa, primarily in public sector projects focused on energy and mineral asset acquisition.
  • India sources 34 million tonnes of oil (15% of its demand) and rising quantities of natural gas and minerals from Africa.
• International Solar Alliance:
  • India has committed $2 billion for solar projects in Africa under the International Solar Alliance, adding another dimension to energy partnerships.

Building Resilient Supply Chains in Africa

• African Policy Shifts:
  • African governments are moving away from the raw export of minerals, aiming for more value-added industries:
    • Tanzania: Developing a multi-metal processing facility.
    • Zimbabwe and Namibia: Banned raw mineral exports to encourage domestic value addition.
    • Ghana: Approved policies for green mineral management.
    • African Green Mineral Strategy: Aims to promote Africa’s industrialization based on its mineral wealth, offering partnership opportunities for India.

The China Factor in Critical Minerals

• Chinese Dominance:
  • China dominates the global critical mineral value chain, creating economic and security risks for India.
  • Beijing’s early asset acquisitions and processing capacity have given China significant influence.
• Chinese Presence in Africa:
  • Chinese mining companies, especially in cobalt mining in the Democratic Republic of Congo, are deeply entrenched.
  • China recently signed a $7 billion minerals-for-infrastructure deal in Africa.

Collaborative Opportunities for India in Africa

• Infrastructure Development:

• • Indian construction companies have completed projects in 43 African countries, including transmission lines in Tunisia, hospitals in Tanzania, and railway lines in Ghana.

• Strategic Projects:

• • India is focusing on building infrastructure adjacent to mining operations and identifying strategic projects in critical minerals with African host countries.

• Bilateral Agreements:

• • India signed memoranda of understanding (MoUs) with Zambia and Zimbabwe for geological mapping, mineral deposit modeling, and capacity building in the mining sector.

• Workforce Development:

• • India’s Indian Technical and Economic Cooperation (ITEC) program has trained 40,000 Africans over the past decade. This can be leveraged to build a critical mineral workforce and enhance India-Africa energy partnerships.

Way Forward for India-Africa Cooperation

• Technological Startups:
  • Indian technology startups are providing innovative solutions across the mining value chain, from exploration to extraction and processing.
  • These startups are using technology to minimize environmental impacts while accelerating mineral exploration.
• Adding Value:
  • Africa is increasingly focused on value addition in its mining sector. Marit Kitaw, Director of the African Minerals Development Center, emphasized that adding value is key to transforming lives.
  • India’s Critical Mineral Mission should align with responsible mining practices, considering the geopolitical implications of the global energy transition.

Conclusion

India’s Critical Mineral Mission presents a strategic opportunity to collaborate with Africa, leveraging the continent’s vast mineral resources. By fostering partnerships with African countries, developing resilient supply chains, and supporting industrialization through value addition, India can strengthen its position in the global energy transition. Collaborative efforts in infrastructure development, capacity building, and technological innovation will be critical for India to secure its mineral supply and fulfill its energy goals.