Q. Consider the following statements:
India has largest Public distribution system in the world.
In respect to the Food grains, The PDS works on the basis of explicit subsidy paid to Food Corporation of India
This subsidy is used to meet the difference between the procurement price paid by FCI to farmers and the price it sells to PDS
Which among the above statements are correct?
Answer: 1, 2, 3
Notes:
- India has largest Public distribution system in the world: This statement is correct. India has the largest public distribution system in the world. It is responsible for distribution of food grains at affordable prices.
- In respect to the Food grains, The PDS works on the basis of explicit subsidy paid to Food Corporation of India: This statement is correct. The central government provides an explicit subsidy to Food Corporation of India (FCI) for distributing food grains under the PDS. This subsidy covers losses incurred by FCI.
- This subsidy is used to meet the difference between the procurement price paid by FCI to farmers and the price it sells to PDS: This statement is also correct. The subsidy bridges the gap between the minimum support price paid to farmers and the lower issue price under PDS. This enables affordable food grains for the poor.
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