ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Does Computerisation Reduce PDS Leakage?

Lessons from Karnataka

The idea that end-to-end computerisation can reduce public distribution system leakage has been theorised, but not yet examined in practice. This note tries to fill the gap by conducting a case study of the information technology system for PDS in Karnataka, which includes back-end software as well as a front-end interface. It reveals three drawbacks: machines can be tampered, there is limited monitoring of the early stages of the supply chain, and policy shifts cannot be achieved by technology alone. It concludes by drawing lessons for other states computerising their PDS.

Our research work has been funded by the International Institute of Information Technology Bangalore, and by the Bagri fellowship awarded by the LSE Asia Research entre. We are immensely grateful to these institutions. We are also thankful to the anonymous referee for helpful comments.

In spite of the policy changes occurred over the last decades, the public distribution system (PDS) remains at the core of India’s food security agenda. Enforcement of the National Food Security Act (NFSA) is predicated on good functioning of the PDS, which has further increased the programme’s relevance (Choitani and Pritchard 2015). Discussion of the PDS and its effectiveness is today as heated as ever: the debate concerns not only the estimates of leakage, but also their policy implications, ranging between substitution of PDS with cash transfers and improvement of the system through state-level reform. It is, hence, important to examine existing policy measures, and assess their capability to increase effectiveness of the programme.

Among the diverse streams of reform, computerisation has been one of the most discussed. End-to-end computerisation of the programme, from procurement to delivery of goods in ration shops, has been linked to its greater effectiveness and accountability, for example, in Chhattisgarh and Gujarat (commended by the Justice Wadhwa Committee on Public Distribution System Report on the State of Karnataka 2010).1 In particular, computerisation has been devised to combat leakage, especially in the form of illegal diversion of PDS goods to private markets. The idea of computerisation as a means to increase transparency of governance has been theorised (Bhatnagar 2004; Madon 2009), but not yet examined with reference to the PDS.

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