Replacing PDS with DBT shows mixed results in Economic Survey

NEW DELHI: Replacing subsidised public distribution system ( PDS) supplies with direct beneficiary transfer, tried out within Chandigarh and Puducherry, has showed mixed results and highlighted the need for more caution and better infrastructure, the Economic Survey has observed.

“The pilot exercises of direct beneficiary transfer (DBT) in lieu of PDS … in Chandigarh and Pondicherry offer a cautionary tale. DBT was introduced and rolled back within two months in Pondicherry, only to be reintroduced,” it said.

The use of direct transfer was expected to eliminate a lot of wasteful expenditure, corruption and leakages, which would lead to much better targeting of funds for the needy. But the experiment in the two union territories did not show very clear gains, it said.

“Despite some evidence on reduced leakages, independent evaluations emphasise the need for an improved digital financial infrastructure even in these relatively urban settings,” it noted. PDS is one of the biggest welfare programmes of the government, helping farmers sell their produce at remunerative prices as well as the poorer sections of society buy food grains at affordable rates.