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FPS Automation - Issues & Challenges Chhattisgarh Experience COREPDS- A.K.Somasekhar

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What was there before COREPDS? Chhattisgarh computerized the whole PDS supply chain in 2007-08 Increased Transparency,Accountability, Efficiency

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Situation before initiative As a result Leakages and diversion have drastically come down Genuine beneficiary in Chhattisgarh is no doubt, getting her full entitlements. But still there are problems faced by beneficiary at FPS.

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Most common problems faced by beneficiary at FPS FPS is not open when the beneficiary wants to take her rations, leading to additional trips. FPS declares 'no stock' even when the FPS has sufficient stocks, leading to additional trips. The sales person does not accord due respect to the beneficiary or sometimes misbehaves.

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Most common problems faced by beneficiary at FPS (contd.) Overcharging The sales person charges more than what is chargeable. Deliberate under-weighment & Adulteration of the commodities by sales person. Beneficiary may need to spend at least half a day to take commodities because of long queues.

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Solution to above problems No technology can solve the above problems. But portability can solve the problems. Portability empowers beneficiary to go to an FPS giving better services, there by creating a reason for improvement in service at FPS. Solution is the Beneficiary empowerment

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Power of right to chose Q Why your colony's provision shop-wala shall never ill-treat you? A if he ill-treats you or hurts your ego you will stop going to the shop. Because you have freedom to chose where to purchase he will treat you well.

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What COREPDS offers The convenience that technology has given to a bank account holder to withdraw money from any ATM, is being offered to a poor BPL beneficiary in COREPDS

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COREPDS Objectives To empower beneficiary To improve Service Delivery To reduce Diversion To weed out Bad FPS To create Transparency

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CORE PDS- How it works

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Every FPS has a POS device

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Smart Ration card for a BPL beneficiary Smart card has no biometrics. Uses KMS supplied by NICHQ

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13 Click to Issue PDS Commodities through SRC

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15 Inserting Beneficiarys SRC

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17 Click if Beneficiary Details are Correct

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18 RC Number

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19 Beneficiary Food Balances Member Details RC Number

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21 Select Member Enter Quantities

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22 Click to Issue

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23 Transaction ID, Quantities Issued, Member ID, TransactionDate

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24 Success Report Transaction ID, Quantities Issued, Member ID, TransactionDate

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25 Process Success

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27 Click to Print Receipt

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APL Benficiaries They are not given smart cards. They will register mobile numbers They take commodities using OTP

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Issue PDS Commodities without SRC There will always be a situation where a small percentage of genuine beneficiaries do not have SRCs because either they could not take in the distribution camps or they have lost and duplicate is not yet been received. This use case is to serve these genuine beneficiaries even with the risk of a few proxy issues. These beneficiaries shall not get the advantage of portability. But can take the commodities from their linked FPS.

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RSBY Cards to be used as Ration cards COREPDS uses RSBY smart card as ration card Government of Chhattisgarh has recently decided to universalize RSBY through out Chhattisgarh. COREPDS rolled out in Durg city at 69 FPSs without issuing a separate smart cards, but using RSBY cards as ration cards

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COREPDS is readily scalable to Aadhaar authentication

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RC Number Name Biometric Auth. 14010101240611 Pratap Sahu N RC Number Name Aadhaar Number 14010101240611 Pratap Sahu NA 14010101240611 Preethi Sahu NA 14010101240611 Shivesh Sahu NA RC Number, Member ID Food A/C Balances Server

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RC Number Name Biometric Auth. 14010101240611 Pratap Sahu Y RC Number Name Aadhaar Number 14010101240611 Pratap Sahu 143052789626 14010101240611 Preethi Sahu 327692489563 14010101240611 Shivesh Sahu 165902789985 Member ID, RC No., Finger Print Aadhaar No., Finger Print Server Y/N Food A/C Balances

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RISKS, CHALLENGES & MITIGATION STRATEGY

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Risk 1 Implementation of CORE PDS acts against the interest of many FPS Agencies. It is not wise to assume that FPS will sincerely try to implement CORE PDS

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Mitigation Strategy When one FPS says that the POS is not working beneficiary can go to a near by FPS. FPS that can not run COREPDS loses its business to other FPSs. FPS automation without portability as tried in some States is difficult to sustain

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Risk 2 In the initial days, all FPSs in an area can form a nexus and see that POSs do not work.

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Mitigation Strategy CGSCSC operates mobile FPS.

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Mitigation Strategy Whenever a report is received that many FPSs are not working in one area, these trucks will be sent to that area. They serve the beneficiaries in front of the FPSs. Thus, FPSs who do run CORE PDS shall lose their business.

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Risk 3 Competition does not help if everyone is bad. FPSs may intentionally do not improve their service to prove that COREPDS is a failure.

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Mitigation Strategy Good performers NGOs, Corporates under their CSR will be introduced 50 FPS buildings under construction, each costing 10 lakhs They will set benchmark for service

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Risk 4 Connectivity is either not available or speed is not sufficient

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Mitigation Strategy Connectivity Survey was done. GPRS connectivity is available at 7200 FPSs out of 8000 FPS served. Effective speeds vary from 20 KBPS to 70 KBPS.

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Location of FPSs in Raipur

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Risk 5 Unreliable connectivity

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Mitigation Strategy COREPDS by design is an online system. But it allows a limited offline issues also in case of connectivity failure ( 3 for a beneficiary and 100 for an FPS) Offline records will be uploaded whenever Smart card is inserted in a connected POS device or through FI module

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Thoughts for Debate

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FPS automation without portability FPS automation without portability creates more inconvenience to the genuine beneficiary

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Biometric authentication Waive-off facility Friend families With any other genuine beneficiaries authentication

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Portability in Rural areas? Migrated labourers To serve small villages at door steps Social reasons

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Weighing Scale integration? Under-weighment is due to disempowerment. Empower the beneficiary. No need to integrate weighing scales with POS device.

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Benefits relaised in COREPDS Reduced waiting time at FPS Reduced number of trips to FPS Behavioral change in FPS sales men Weeding out bad FPS Bribe money stopped at the root

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Reduction in Diversion IndicatorBefore COREPDS After CORPDS Remark Sale of BPL Grain 100%95% Prior to COREPDS, FPSs used to record proxy issues and declare 99 to 100% sale. After introduction of Smart card / OTP authentication the sale figure have reduced. Sale of Kerosene 100%75% Sale of APL Grain 80%50%

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Freedom to chose Currently 20% of beneficiaries are using portability. Remaining beneficiaries are taking at their own FPS, but now with their choice not by compulsion. At this context I want to refer Amartya Sens quotation which is as follows

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From 'Development as Freedom', p 27 "A person produces the same commodities in the same way and ends up with same income and buys the same goods, she may still have very good reason to prefer the scenario of free choice over that of submission to order" Amartya Sen Winner of the nobel prize in economics

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What kind of FPS automation? Online system, but should support a limited offline transactions Aadhaar-based Biometric authentication with alternate authentication mechanism RSBY or other Smart cards for quick start without waiting for Aadhaar saturation and to allow for offline transactions

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What kind of PDS envisioned? Empowered beneficiary with choice of FPS, choice of commodities and choice to take cash instead of commodities NGOs/ MNC running FPS chain treating beneficiary as a valued customer, to capture fortune at the bottom of the pyramid Mobile FPS to serve remotest villages at their door steps

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Thank You This kind of PDS is not a distant dream with available technology and growing political and burocratic will for improving PDS A.K.Somasekhar som@nic.insom@nic.in, 94252 02643