Heavily Subsidised Foodgrains under The National Food Security Bill, 2011

The National Food Security Bill, 2011 (NFSB), as introduced in the Lok Sabha on 22.12.2011, provides for coverage of up to 75% of the rural population, with at least 46% belonging to priority households, and up to 50% of the urban population, with at least 28% belonging to priority households, for subsidized foodgrains under Targeted Public Distribution System (TPDS). Every person belonging to priority household will be entitled to receive 7 kg of foodgrains per person per month at prices not exceeding Rs. 3/2/1 per kg for rice/wheat/coarsegrains, whereas every person belonging to general household will be entitled to receive not less than 3 kg per person per month at a price not exceeding 50% of Minimum Support Price (MSP) for wheat and coarsegrains and not exceeding 50% of derived MSP for rice.

As per the provisions of the Bill, estimated annual requirement of foodgrains, at 2011 population, is 60.74 million tons and the corresponding estimated food subsidy, at 2013-14 costs, is about Rs. 1,23,084 crore. Actual requirement for the year will however depend upon the final shape of the Bill, as passed by the Parliament, and the time by which the Act comes into force. An amount of Rs. 77,740 crore has been allocated as food subsidy in the Budget Estimates for current year, 2013-14. Besides, the Finance Minister in his Budget Speech 2013-14 has inter alia stated that Rs. 10,000 crore has been set apart, over and above the normal provision for food subsidy, towards the incremental cost that is likely under the Act.

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