Policy Update
Devshi Satish Mishra
Background
The National Food Security Act (NFSA), 2013, was introduced by the Government of India to strengthen the Public Distribution System (PDS) in India, in order to provide food and nutritional security by ensuring access to food of sufficient quantity and quality to all beneficiaries. Before this Act, all households of India with a valid ration card received a fixed amount of commodities at a subsidised rate under the Targeted Public Distribution System. However, there were issues within this system, such as inadequate service network planning, cost structure, resource utilisation, and corruption. NFSA 2013 was implemented to overcome these challenges and meet the nutritional and accessibility targets.
NFSA legally entitles up to 75% of the rural population and 50% of the urban population to subsidized (presently free of cost) food grains through the Targeted Public Distribution System (TPDS), ensuring that vulnerable households receive adequate food and nutrition. In addition to this, the Act provides that pregnant women and lactating mothers, and children in the age group of 6 months to 14 years are entitled to meals as per prescribed nutritional norms.
Functioning
The NFSA 2013 categorises the eligible population into two main divisions: Priority Households and Antyodaya Anna Yojana (AAY) Households (identified as the poorest of the poor). Once these beneficiaries are identified, the Act guarantees them specific entitlements of food grains at subsidized rates. The functioning of these entitlements differs between the two groups:
- Priority Households are entitled to 5 kg of food grains per person per month.
- AAY Households are entitled to 35 kg of food grains per household per month.
These provisions are delivered to the beneficiaries through a vast network of Fair Price Shops (FPS). The availability, accessibility, and regular operation of these FPSs are crucial for the success of the entire PDS, especially in rural and underprivileged areas.
The Food Corporation of India (FCI) is the central agency responsible for executing the logistical components of the Act. The NFSA’s functioning is dependent on the FCI’s performance in three key areas:
- Procurement. The FCI’s primary objective is the procurement of essential commodities. The Act’s success requires better policies for purchasing food crops to meet the mandated demand. This implicitly implies policies for agricultural activities and biotechnological support to boost production and productivity. Without these, policies supporting the purchase of food crops would be futile.
- Storage. The FCI is responsible for the storage of these procured food grains. To meet the NFSA’s requirements and avoid wastage, this involves the scientific expansion of storage capacity and the efficient utilization of existing facilities.
- Distribution and Transportation. The FCI manages the transportation of food grains from procurement states to various demand points across the country. This distribution pillar is what connects the procurement and storage functions to the local FPS network that directly serves the beneficiaries.
Moreover, the identification of NFSA beneficiaries is a continuous process led by State and Union Territory governments. This involves removing ineligible, fake, or duplicate ration cards to ensure that only rightful households receive benefits. By maintaining an updated beneficiary list and regulating the supply of foodgrains, the NFSA ensures that vulnerable and needy populations are effectively supported. This process also strengthens food security, helps stabilize market prices, and improves the targeting of eligible beneficiaries across the country.
Performance
As of 2025,
- 100% digitized ration cards/beneficiaries’ data has been collected under NFSA in all States/UTs. Details of almost 20.5 Crore ration Cards covering around 80.5 crore beneficiaries are available on the transparency portals of States/UTs.
- More than 99.8% Aadhaar seeding of ration cards has been done (at least one member per household).
- About 99.6% (5.41 Lakh of the total 5.43 Lakh) Fair Price Shops (FPSs) in the country are automated using electronic Point of Sale (ePoS) devices for transparent and ensured distribution of subsidized food grains to beneficiaries.
- Under the distribution of food grains, more than 97% of the transactions have been recorded biometrically/Aadhaar authenticated by States/UTs.
Several schemes and initiatives have been taken to strengthen the Act and support the NFSA ecosystem. Some of the major pillars have been highlighted below.
| Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) | A COVID-19 relief scheme that provided additional free food grains to all NFSA beneficiaries, over and above their normal entitlements. |
| One Nation One Ration Card (ONORC) | A pan-India portability system that allows NFSA beneficiaries to lift their entitled food grains from any Fair Price Shop in the country using their existing ration card. |
| Integrated Child Development Services (ICDS) | A program legally mandated by the NFSA to provide supplementary nutrition (meals and take-home rations) to children aged 6 months to 6 years, pregnant women, and lactating mothers. |
| Direct Beneficiary Transfer (DBT) | An alternative delivery mechanism under the NFSA where the cash equivalent of the food subsidy is transferred directly into the beneficiary’s bank account. |
| Rice Fortification Initiative | A nutritional intervention to add essential micronutrients, such as iron, to the rice distributed under the NFSA and PM POSHAN to combat anemia and malnutrition. |
| PM POSHAN (POshan SHAkti Nirman) Scheme | The current name for the Mid-Day Meal Scheme, a legal entitlement under the NFSA, providing one hot cooked meal to children in government and government-aided schools. |
| Pradhan Mantri Matru Vandana Yojana (PMMVY) | The scheme that delivers the NFSA-mandated maternity benefit, providing a cash incentive to pregnant and lactating women for partial wage-loss compensation. |
| Food Security Allowance | A legal provision in the NFSA requiring the state government to pay a cash allowance to beneficiaries in the event of non-supply of their entitled food grains or meals. |
| “Mera Ration” Mobile App | A mobile application linked to the ONORC system that allows beneficiaries to check their entitlement status and locate the nearest Fair Price Shop. |
| End-to-End Computerisation of TPDS | To digitise the entire PDS, including beneficiary databases, supply chain management, and the automation of Fair Price Shops with ePoS devices. |
| Antyodaya Anna Yojana (AAY) | Targets the “poorest of the poor” households, providing them with a legal entitlement of 35 kg of food grains per household per month. |
| Grievance Redressal Mechanism | Requires states to appoint District Grievance Redressal Officers and State Food Commissions to resolve public complaints about entitlements. |
To further build on these reforms, the Government of India is set to launch the SMART-PDS (Scheme for Modernisation and Reforms through Technology in PDS) initiative, in phases by December 2025, which aims to strengthen the technological backbone of PDS and bring transformative change by focusing on four key modules:
- Food grains procurement
- Supply chain management and allocation of grains
- Ration card and Fair Price Shop management
- Biometric-based grain distribution Module (e-KYC)
To support the implementation of the National Food Security Act (NFSA) and ensure timely delivery of foodgrains, the total annual allocation of food grains under NFSA stood at 18,498.94 thousand tons as of July 2025 for FY 2025-26, and for FY 2024-25 it was 55,493.044 thousand tons.
Source: https://www.pib.gov.in/PressReleasePage.aspx?PRID=2179514
Impact
As of October 2025, 78.90 crore beneficiaries are receiving free of cost foodgrains under the Act.
A major impact has been the drastic reduction in leakages. Technological interventions like 100% ration card digitization and 99.6% Fair Price Shop (FPS) automation with biometric authentication have slashed grain diversion. Leakages fell from an estimated 42% in 2011-12 to around 22% by 2022-23, meaning significantly more food now reaches the intended households. PDS access is positively impacting nutrient intake and dietary diversity. Initiatives like Rice Fortification are showing early success in combating micronutrient deficiencies, with pilot studies indicating a reduction in anemia prevalence.
The One Nation One Ration Card (ONORC) system has empowered beneficiaries, especially migrants, by allowing them to access rations anywhere in India. This portability is heavily utilized, evidenced by over 158.8 crore portability transactions recorded by late 2024.
As per in reports received from State/UT Governments to the Department of Food and Public Distribution up to the end of June 2024 out of 5.43 lakh fair price shops reported to be 4.22 As per reports received from State/UT Governments up to the end of June 2024 out of 5.43 lakh fair price shops reported to be in operation in the country, about 1.54 lakh fair price shops have been allotted to Cooperatives, Women’s Self Help Groups, Village Panchayats, Urban Local Bodies and other Self Help Groups in 36 States/ UTs.
Emerging Issues
Under this Act, India has been divided into different zones as shown in the following illustration:
Source: Development in Practice, April 2019, Vol. 29, No. 2 (April 2019), pp. 230-249
- Inadequate Service Network. According to the Ministry of Consumer Affairs, Food and Public Distribution, 2011, India has an FPS network of more than 500,000 FPS spread across the country. Yet, this number remains adequate. The ratio of number of families to FPS in the baseline scenario for all zones, except for the North-East zone, has a family/FPS (Fair Price System) ratio over 500, so less than one FPS on average is available for each 500 families. This makes the issue of availability worse in rural and underprivileged areas.
- Major Storage Gaps. There must be a strategic reserve of 3 million tons of wheat and 2 million tons of rice over the prescribed buffer norm, but the FCI-owned capacity is less than even the specified buffer norm. Moreover, more than 70% FCI storage capacity is associated with only seven states. The storage capacities of different zones are highlighted in the following illustration:
Source: Development in Practice, April 2019, Vol. 29, No. 2 (April 2019), pp. 230-249
FCI has initiated a procedure to enhance storage capacity by about 18.1 million tons through a private entrepreneurship guarantee scheme (a government initiative in India to increase foodgrain storage capacity by guaranteeing to hire godowns built by private entrepreneurs, public sector undertakings (like CWC, SWCs), and state agencies), but unfortunately, only 3.2 million tons of capacity have been completed. In the 2016-2017 food grain procurement figures of India (Department of Food and Public Distribution 2018), the North zone accounts for around 50% of India’s procurement, and 48% of the entire storage space. Most of the grains have to be transferred to other zones, as the North zone has only 14% of the total population. The Central zone has 26% of the total population, 25% of the total procurement, and has 20% of the storage space. In the East zone, for 23% of the total population, only 5% of the total storage space is available, which indicates frequent transportation to meet demand. In the West zone, with 15% of the population, only 6% of the storage space is available.
Alongside the required planning, implementation of NFSA can only be achieved by developing a better transportation network, cost structure, quality improvement programme, and eliminating corruption across the country. Improving the availability of major food grains through FPS is still a great challenge faced by the FCI (Source: A research paper funded and supported by the Ministry of Human Resource Development).
Way Forward
The issues discussed in the above section can all be worked upon, given adequate steps are taken:
- To maintain the baseline family to FPS ratio, 100,910 new FPS need to be introduced by 2025.
- Considering the present procurement quantities, increased allocation of food grains can be accommodated. To ensure this, the required transportation facilities and other infrastructures have to be arranged accordingly to maintain a smooth flow of food grains. Also, decisions need to be made to compensate for the increased transportation and storage costs that will be incurred in the process.
- To minimise the frequency of transportation, new warehouses need to be established in all zones (except the North Zone) to allow the TPDS to extend its coverage according to NFSA 2013 and to minimise operational costs and wastage. FCI must increase the total storage capacity by at least 50% over the next five years.
References
Chakraborty, S., & Sarmah, S. P. (2019). India 2025: The public distribution system and National Food Security Act 2013. Development in Practice, 29(2), 230–249. https://doi.org/10.1080/09614524.2018.1527290
Department of Food & Public Distribution. (n.d.). Implementation of National Food Security Act (NFSA). Ministry of Consumer Affairs, Food & Public Distribution. Retrieved October 20, 2025, from https://dfpd.gov.in/implementation-of-nfsa/en
Department of Food & Public Distribution. (n.d.). National Food Security Act, (NFSA) 2013. National Food Security Portal. Retrieved October 20, 2025, from https://nfsa.gov.in/portal/nfsa-act
Department of Food & Public Distribution. (2025). Annual Report 2024-25. Ministry of Consumer Affairs, Food & Public Distribution, Government of India.
Department of Food, Supplies and Consumer Affairs. (n.d.). National Food Security Portal Delhi. Govt. of NCT of Delhi. Retrieved October 20, 2025, from https://nfs.delhigovt.nic.in/
Department of Women and Child Development. (n.d.). Pradhan Mantri Matru Vandana Yojana (PMMVY). Govt. of NCT of Delhi. Retrieved October 20, 2025, from https://wcd.delhi.gov.in/wcd/pradhan-mantri-matru-vandana-yojana-pmmvy
MicroSave Consulting. (2022, August). State Ranking Index for NFSA: Creating resilient food systems to optimize the delivery of benefits. https://www.microsave.net/wp-content/uploads/2022/08/NFSA_2022.pdf
Press Information Bureau. (2024, September 19). Centre takes proactive steps to ensure food security for vulnerable sections of society. Ministry of Consumer Affairs, Food & Public Distribution. https://www.pib.gov.in/PressReleseDetailm.aspx?PRID=2055957
Press Information Bureau. (2025, January 30). Government ensures food security through efficient PDS and ONORC. Ministry of Consumer Affairs, Food & Public Distribution. https://www.pib.gov.in/PressReleasePage.aspx?PRID=2098449
Press Information Bureau. (2025, October 15). India’s multi-faceted mission to ensure food and nutritional equity for 81 crore citizens. Ministry of Consumer Affairs, Food & Public Distribution. https://www.pib.gov.in/PressReleasePage.aspx?PRID=2179514
About the Contributor: Devshi Satish Mishra is a Research Intern at IMPRI and a student at the University of Delhi pursuing Economics Honours.
Acknowledgement: The author sincerely thanks Ms. Aasthaba Jadeja and other IMPRI fellows for their valuable contribution.
Disclaimer: All views expressed in the article belong solely to the author and not necessarily to the organisation.
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