The government has decided to introduce DBT system for fertilizer subsidy payments.
New Delhi: As many as 78 schemes including Jhan Dhan and MGNREGA being implemented by 17 ministries and departments are covered under Direct Benefit Transfer (DBT) system, the Parliament was informed on November 29.
In case of food subsidy, Minister of State for Food C R Chaudhary said, "DBT for foodgrains is being implemented as per the 'cash transfer of food subsidy rules 2015."
At present, cash transfer of food subsidy is being implemented in Chandigarh and Puducherry since September 2015 and it has also been partially implemented in Dadra and Nagar Haveli from March 2016, he said.
A high-level committee of FCI has recommended gradual introduction of cash transfer in PDS, starting with the large cities with more than 1 million population and extending it to grain surplus states and then giving option to deficit states to opt for cash or physical grain distribution, he said.
In Public Distribution System (PDS), the minister said DBT is being implemented in two ways: cash transfer of food subsidy into bank accounts of beneficiaries and DBT in-kind means automation of fair price shops.
Subsidised foodgrains are distributed via PDS after authentication, preferably taking beneficiary details using electronic point of sale machines, while cash transfer of food subsidy is done in three union territories through Aadhaar Payments Bridge (APB), he added.
To a separate query on DBT in fertilisers, Minister of State for Fertiliser Mansukh L Mandaviya said, "The government has decided to introduce DBT system for fertilizer subsidy payments. Under the proposed system, 100 per cent subsidy on various fertilizer grades shall be released to the manufacturers and importers on the basis of actual sales made by the retailer to the beneficiaries."
Initially, the modified-subsidy procedure under DBT system will be introduced on pilot basis in 16 select districts and after its due stabilization, the new payment system would be rolled out in all states in the second phase, he said.
Noting that the DBT being implemented in fertilizer subsidy payment is slightly different from the normal DBT being implemented in LPG subsidy, the minister explained, "Under the DBT in fertilizer sector, the subsidy will be released to the fertilizer companies instead of beneficiaries, after the sale is made by the retailers to the beneficiaries on submission of claims generated in the web-based online Integrated Fertilizer Monitoring System (iFMS) by fertilizer companies."
After implementation of DBT, it is expected that diversion/smuggling of fertilizers will be reduced to a large extent and the government will save subsidy to that extent. However, no assessment has been made to calculate the savings, he added.