Tamil Nadu becomes the 11th State to complete One Nation One Ration Card system reform: Additional borrowing permission of Rs. 4,813 crore issued to Tamil Nadu

Tamil Nadu has become the 11th State in the country to successfully undertake “One Nation One Ration Card system” reform stipulated by the Department of Expenditure, Ministry of Finance. Thus, the State has become eligible to mobilise additional financial resources of Rs. 4,813 (US$ 658.76 million) crore through Open Market Borrowings. Permission for the same was issued by the Department of Expenditure.

Tamil Nadu has now joined 10 other States namely, Andhra Pradesh, Goa, Gujarat, Haryana, Karnataka, Kerala, Madhya Pradesh, Telangana, Tripura, and Uttar Pradesh, who have completed this reform. On completion of One Nation One Ration Card system reform, these 11 States have been granted additional borrowing permission of Rs. 30,709 crore (US$ 4.20 billion) by the Department of Expenditure. State wise amount of the additional borrowing permitted is as under:

• Andhra Pradesh Rs. 2,525 crore (US$ 343.75 million)
• Goa Rs. 22 crore (US$ 3.01 million)
• Gujarat Rs. 4,352 crore (US$ 595.66 million)
• Haryana Rs. 2,146 crore (US$ 293.73 million)
• Karnataka Rs. 4,509 crore (US$ 616.20 million)
• Kerala Rs. 2,261 crore (US$ 308.99 million)
• Madhya Pradesh Rs. 2,373 crore (US$ 323.06 million)
• Tamil Nadu Rs. 4,813 crore (US$ 657.75 million)
• Telangana Rs. 2,508 crore (US$ 341.44 million)
• Tripura Rs. 148 crore (US$ 20.26 million)
• Uttar Pradesh Rs. 4,851 crore (US$ 663.96 million)

One Nation One Ration Card System is an important citizen centric reform. Its implementation ensures availability of ration to beneficiaries under National Food Security Act (NFSA) and other welfare schemes, especially the migrant workers and their families, at any Fair Price Shop (FPS) across the country.

The reform especially empowers the migratory population mostly labourers, daily wagers, urban poor like rag picker, street dwellers, temporary workers in organised and unorganised sectors, domestic workers etc., who frequently change their place of dwelling to be self-reliant in food security. This technology driven reform enables the migrant beneficiaries to get their entitled quota of food grains from any electronic point of sale (e-PoS) enabled fair Price Shops of their choice anywhere in the country.

The reform also enables the States in better targeting of beneficiaries, elimination of bogus/ duplicate/ineligible card holders resulting in enhanced welfare and reduced leakage. Further, to ensure seamless inter-state portability of a ration card, Aadhar seeding of all ration cards as well as biometric authentication of beneficiaries through automation of all Fair Price Shops (FPSs) with installation of electronic point of sale (e-PoS) devices are essential. Therefore, additional borrowing limit of 0.25% of the Gross State Domestic Product (GSDP) is allowed to the States only on completion of both of the following actions:

• Aadhar Seeding of all the ration cards and beneficiaries in the State
• Automation of all the FPSs in the State.

In view of the resource requirement to meet multiple challenges posed by the COVID-19 pandemic, the Government of India had on 17th May 2020 enhanced the borrowing limit of the States by 2% of their GSDP. Half of this special dispensation i.e. 1% of GSDP was linked to undertaking citizen centric reforms by the States. The four citizen centric areas for reforms identified by the Department of Expenditure were (a) Implementation of One Nation One Ration Card System, (b) Ease of doing business reform, (c) Urban Local body/ utility reforms and (d) Power Sector reforms.

So far 11 States have implemented the One Nation One Ration Card System, 8 States have done ease of doing business reforms, and 4 States have done local body reforms. Total additional borrowing permission issued so far to the States who have done the aforesaid reforms stands at Rs. 61,339 crore (US$ 8.40 billion).

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.