Portability in the Public Distribution System – Determinants of Utilization & their Implications

Abstract

Public Distribution System (PDS) in India is a major instrument for achieving the goal of “Zero Hunger”. Despite the vast amounts of resources spent, PDS suffers from several inefficiencies largely attributable to the monopoly of agents involved in last-mile delivery of grains. To address this issue, several state governments in India have started implementing a novel intervention called portability. This intervention offers beneficiaries the choice of when and where they can avail of their food entitlements while the government controls what and how much. We use detailed and large-scale program data from Andhra Pradesh to analyze the uptake of portability among beneficiaries and identify its underlying drivers. We find that a sizeable fraction (~28%) of beneficiaries utilize this choice. Primary factors influencing the uptake are the number of agents a beneficiary has access to and the number of days in a month an agent is open for distributing food entitlements. We find that usage levels among the vulnerable populations such as the rural, the poor, the elderly and the socially disadvantaged, to be ~24%, ~29%, ~24% and ~16% lesser in comparison to their non-vulnerable counterparts, respectively.

Keywords: Food security programs, India, Public Distribution System, cash vs in-kind transfers, portability, choice in public services