The announcement has sent shock waves through the civil society, given the criticism of the scheme in Kotkasim, Alwar district, Rajasthan. Activists said it would mean certain exclusion of the poor from their food entitlements, threatening their fundamental Right to Life. The payment of cash in place of food requires ration card-holders to have a bank account and an Aadhaar number.
It has already been decided to rollout cash transfer for non-food items such as kerosene, pensions and others from December 15 in select districts where majority of the population has been covered by Aadhaar.
A pilot scheme for food items, similar to the cash transfer made for kerosene subsidies in Kotkasim, would be carried out in the Union territories, Thomas told Business Standard.
States would have the option of either transferring subsidies to bank accounts of ration card-holders or of giving cash as a substitute for food, he said.
He cited the example of Delhi and said that the state was in favour of giving cash as a substitute while there are many states that do not want the food aid to be replaced by cash, he said.
Usha Ramanathan, activist and lawyer, said the cash transfer for food items and other items of the public distribution system was being rushed only to justify the Aadhaar scheme.
If Aadhaar is to be viable or find any takers, it must have the public distribution system riding on it, says Ramanathan. “Or, why would anyone want an Aadhaar number? And if no one wants it, what is its relevance? Nandan Nilekani, who heads the UID programme, would become irrelevant. Hence the urgency to force cash transfer on poor villagers,” she added.
The contract has been put on hold and further payments have been stopped
Says supply response to inflation has been weak