Fighting Hunger by Supporting Supply Chain Reforms in India

India operates one of the largest food safety nets in the world. Through the Targeted Public Distribution System (TPDS), the Government aims to provide around 800 million people with subsidized monthly household rations each year–that’s about 67% of India’s population.

In 2012, WFP began directly supporting the Ministry of Consumer Affairs, Food and Public Distribution to strengthen the existing TPDS.

To do this, WFP led the development of a Best Practice Solution called the ‘TPDS 3S model’, which serves as a national level, technology-led, best practice framework for subsidized food delivery. This model has been endorsed by the Government of India and recommended to all States across the country for consideration in their TPDS reform efforts.

The TPDS 3S model can be fully adapted given specific State level contexts. WFP worked with the State Government of Odisha to test, design and share TPDS best practices. This work included testing state-of-the-art technology such as biometric authentication. The TPDS 3S model is based on WFP’s work in Odisha, as well as other best practice examples from across the country, and was developed together with the Government of India.

In 2014, WFP began working with the State of Kerala. One of the main areas of technical support included assessment of their supply chain network and recommendations on ways to improve, and subsequently, set-up a door-to-door delivery system. An in-depth analysis identified three main flows of their supply chain:

  • Flow of information (authority letters, stock reporting, release orders),
  • Flow of grains (physical movement, transportation, loading/unloading), and
  • Financial flow (buying/selling price, additional commissions, subsidy payments)

Based on the analysis of these three flows, recommendations were made to undertake a simulation by modelling its network to allow an optimization of the overall TPDS supply chain. This analysis recommended the optimal network and illustrated possible options, such as more focus on appropriate storage, quality control procedures and better optimization of transportation.

Another key recommendation was the adoption and implementation of a comprehensive supply chain management software solution, which would allow stakeholders to automate various routine tasks and forecast the movement/requirement trends. In addition, a comprehensive dashboard would be able to report against Key Performance Indicators, enabling stakeholders to monitor and make appropriate decisions.

The Benefits of Implementing WFP’s 3S model across India
The proposed TPDS 3S model, which WFP is implementing in the States of Odisha and Kerala, is flexible and can be scaled-up. It would cost an estimated US$500-600 million to be implemented across the country, and is projected to result in savings of around US$1-2 billion. Nationally, these savings could total 8-10% of the current food subsidy, representing a recovery of the investment within less than one year.