India has made significant gains in reducing malnutrition, and the National Food Security Act is one reason for that. Any reduction in coverage of those legal entitlements, as recently proposed by the Niti Aayog, should ensure those gains are not lost.
For millions of poor households in India, subsidized food grains have been a lifeline, especially during the covid-19 pandemic. These subsidies, given under the National Food Security Act (NFSA), have earlier been said to cost the Centre around ₹1 trillion a year. A recent proposal by the Niti Aayog reportedly aims to reduce the burden, but a closer look shows it could directly affect the vulnerable.
In 2013, the NFSA made access to a designated quantity of foodgrains a legal entitlement. Up to 67% of the population—75% in rural areas and 60% in urban areas—is entitled to the scheme, which is about 813.5 million Indians according to 2011 Census data. However, the Niti Aayog, in a discussion paper circulated internally, has proposed to lower the ratios to 50% in rural areas and 40% in urban areas.
The think tank reportedly estimates annual savings of up to ₹47,229 crore if these revised levels are applied to 2020 population estimates. If coverage remains at present levels for the 2020 population, food subsidies will increase by ₹14,800 crore.
For perspective, the Centre expects to spend ₹2.43 trillion in 2021-22 on its food subsidy bill. This is over two times the average annual expenditure in recent years, but gives a much truer picture since the Centre has now moved certain off-budget borrowings to the Budget. The shift elevated the food subsidy bill for 2020-21 too, to ₹4.22 trillion, though it was also in part due to expanded food entitlements as part of the covid-19 package.
Even presently, the scheme ails with concerns of exclusion. The number of beneficiaries is divided among states using the government’s Household Consumer Expenditure Survey of 2011-12. The number was frozen in 2013 and has not been updated, prompting the Centre to ask the Niti Aayog to formulate an alternative methodology.
In a study last year, researchers Jean Dreze, Reetika Khera and Meghana Mungikar estimated that using 2011 data even in 2020 excluded 100.8 million eligible Indians from the NFSA. The highest under-coverage was in Uttar Pradesh (30.6 million) and Bihar (17.5 million), which received huge numbers of returning migrants during the lockdown.
States have repeatedly urged the Centre to revise the coverage to the latest population estimates. While the latest Niti Aayog calculations consider the 2020 estimates, the proposed reduced coverage means the number of beneficiaries will fall to 716 million, according to the document.
The NFSA has been critical in reducing malnutrition. Data from the National Family Health Survey (NFHS) shows that between 2005-06 and 2015-16, the share of undernourished population fell from 44.3% to 21.2% at a national level. While this cannot be attributed to NFSA alone, it is likely that the scheme has improved access to foodgrains for the most vulnerable. However, poorer states such as Bihar (40.9%), Jharkhand (36.6%), and Uttar Pradesh (31.4%) continue to have a much larger proportion of undernourished population.
These numbers combine the proportion of malnourished across men, women and children, and have been compiled by the Oxford Poverty and Human Development Initiative. NFHS 2018-19 has preliminary results for 22 states, including on nutrition for five of the 10 most populous states. While the numbers are not strictly comparable to the aggregate data from earlier rounds, the trends are mixed.
West Bengal and Maharashtra have shown an increase in the proportion of under-weight children between 2015-16 and 2018-19, but a fall in the share of undernourished among men and women. Karnataka and Bihar show a decline in the share of undernourished across all three groups.
According to the Household Consumption Survey of 2011-12, the latest round for which this data is publicly available, 45.9% of rural households and 23.3% of urban households reported consumption of rice from the public distribution system (PDS) in the 30 days prior to the survey. For wheat, it was 33.9% of rural households and 19% of urban households.
This is likely to have increased in the following years, partly due to the implementation of the NFSA. More significantly, the poorest households drew a higher proportion of their foodgrain consumption from the PDS.
The Niti Aayog report justifies lowering the coverage on the basis of “growth and development over the past decade", adding that savings from food subsidies could be used for health and education. However, given that a significant population is dealing with the economic fallout of the pandemic, lower coverage could stress them and reverse some of the malnutrition gains.