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2019-09-26

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Indian Economy
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The writer works on digital identity with Omidyar Network.

The writer works at Omidyar Network India, an investment firm focussed on social impact through equity investments and grants, with an emphasis on technology.

On Independence Day this year, Prime Minister Narendra Modi called for national integration through several “one nation” initiatives such as a singular mobility card, tax regime and electricity grid. One such initiative, “One Nation, One Ration Card”, is meant to enable a resident from, say, Darbhanga, to access her food rations in Patna or Mumbai. The Ministry for Food and Public Distribution has commenced pilots between Maharashtra-Gujarat and Andhra-Telangana, and has committed to a national rollout by June 30, 2020.

The Economic Survey 2017 estimated that over nine million Indians change their state every year. For them, the “One Nation, One Ration Card” is a gamechanger because it makes their rations “portable”, allowing them to pick up foodgrains from any ration shop in the country. It also benefits nonmigrants by allowing them to transact at better-performing shops locally. This local “choice effect” is extremely popular in Andhra Pradesh, which has introduced such portability within the state since October 2015. A study by researchers at the Indian School of Business (ISB) found that over 25 per cent of Public Distribution System (PDS) beneficiaries in the state now use portability.

However, we must approach this bold vision with utmost caution because PDS is a crucial lifeline for many of the 800 million Indians it reaches. It provides them with at least 5 kg of grain per person per month, equivalent to 25 per cent of an individual’s recommended calorie intake. Even well-intentioned changes that shock the system can therefore have potentially catastrophic outcomes for some. In 2017, it was reported that a 11-year old Dalit girl named Santoshi Kumari from Jharkhand died when her family was unable to access rations in the aftermath of large-scale revisions in the beneficiary list. Over 18 starvation deaths have been reported in the state since September 2017. Such tragedies must be prevented at all costs and we should therefore be cautious while restructuring the program.

We believe that three considerations are important to keep in mind while thinking about the “One Nation, One Ration Card” initiative. First, fundamental processes related to the PDS need to be redesigned to empower every individual. The State of Aadhaar Survey 2017-18 found that nearly 6.5 per cent of PDS beneficiaries in Rajasthan were denied ration because the shopowner claimed to be out of food grain. This translates to over 3.5 million people in Rajasthan alone. A beneficiary has no mechanism to question whether the shop owner is telling the truth or diverting rations. Portability and biometrics will not solve this problem completely.

Portability in Andhra Pradesh does well because it exists in an environment of accountability of ration shops. The state government collects feedback in real time through a mobile-based system. The central government should use this opportunity to make PDS more user-centric. It should track denial of service on a real-time basis through mobile-based surveys. It should commission research on the experiences of particularly vulnerable groups such as the elderly, migrants, disabled and tribals to modify the process where needed. It should enable beneficiaries to track the amount of food at nearby ration shops using their

mobile phones.

Second, the operational backbone of the PDS needs to be restructured to promote portability. States should be brought together on a national platform that is based on the same technical standards and can therefore “speak” to each other (what technologists call “interoperability”), so that portability works seamlessly across states. The system should be based on what technologists call “open APIs” so that states can customise the user interface to their local needs, and add features and additional entitlements as they deem fit. The system should enable real time tracking of inventories and rapid response to low stock situations.

Thirdly, while leveraging the power of Aadhaar for PDS, the government should actively address privacy and exclusion risks that the use of Aadhaar and a centralised PDS platform can lead to. In early 2018, the UIDAI introduced privacy protecting features such as virtual ID and tokenisation. However, few actually use them. The government should enable every section of society to understand and use these features through both online and offline methods. The government should also acknowledge that authentication failures will happen in any biometric system. Studies by ISB in multiple states point to a 1-3 per cent failure rate, potentially affecting 8-24 million people at a national scale. To prevent denial of service, the government should ensure availability of non-biometric means of authentication (such as OTP or PIN), as well as manual overrides.

In conclusion, we suggest that the central government adopt a patient path of “a hundred small steps” while implementing this vision. It should start by encouraging all states to roll out within-state portability. This will also increase their operational and technical capacity. In the meantime, it should work on a national technical platform that works for all states. Such a gradual rollout will prevent transition glitches that show up as harmless statistics in reports, but are a matter of life and death for millions in our country. We owe this to Santoshi, and to many others like her.

The writers work at Omidyar Network India, an investment firm focussed on social impact through equity investments and grants, with an emphasis on technology

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