Report of the Committee on Revisiting & Revitalising the PPP Model of Infrastructure Development Chaired by Dr. V.Kelkar Released

Report of the Committee on Revisiting & Revitalising the PPP Model of Infrastructure Development Chaired by Dr. V.Kelkar Released

The Report of the Committee on Revisiting & Revitalising the PPP model of Infrastructure Development chaired by Dr. V. Kelkar has been issued and also uploaded on the Ministry of Finance’s website (finmin.nic.in).

In the Union Budget 2015-16, the Finance Minister Shri Arun Jaitley had announced that the PPP mode of infrastructure development has to be revisited and revitalised.  In pursuance of this announcement, a Committee on Revisiting & Revitalising the PPP model of Infrastructure Development was set-up which was chaired by Dr. Vijay Kelkar. The Report of the Committee submitted to the Government has been uploaded on the Ministry of Finance’s website.

(http://finmin.nic.in/reports/ReportRevisitingRevitalising PPPModel.pdf).

                                                           

The Executive Summary of the Report is as follows:

Highlights of the Report

1.Public Private Partnerships (PPPs) in infrastructure refer to the provision of a public asset and service by a private partner who has been conceded the right (the “Concession”) for the purpose, for a specified period of time, on the basis of market determined revenue streams, that allow for commercial return on investment.

2. PPPs in infrastructure represent a valuable instrument to speed up infrastructure development in India. This speeding up is urgently required for India to grow rapidly and generate a demographic dividend for itself and also to tap into the large pool of pension and institutional funds from aging populations in the developed countries.

3. India offers today the world’s largest market for PPPs. It has accumulated a wealth of experience in getting to this premiere position. As the PPP market in infrastructure matures in India, new challenges and opportunities have emerged and will continue to emerge. Periodic review of PPPs, as in the present Committee's remit, are a must to help address issues before they become endemic and to mainstream innovations and foster new ones that improve the successful delivery of PPP projects.

 4. India’s success in deploying PPPs as an important instrument for creating infrastructure in India will depend on a change in attitude and in the mind-set of all authorities dealing with PPPs, including public agencies partnering with the private sector, government departments supervising PPPs, and auditing and legislative institutions providing oversight of PPP’s.

5. The Government may take early action to amend the Prevention of Corruption Act, 1988 which does not distinguish between genuine errors in decision-making and acts Report of the Committee on Revisiting and Revitalising the PPP Model of Infrastructure. Measures may be taken immediately to make only malafide action by public servants punishable, and not errors, and to guard against witch hunt against government officers and bureaucrats for decisions taken with bonafide intention. The government may speed up amendment of the Prevention of Corruption Act, Vigilance and Conduct rules applicable to government officers.

6. Experience has also underlined the need to further strengthen the three key pillars of PPP frameworks namely Governance, Institutions and Capacity, to build on the established foundation for the next wave of implementation.

 7. In addition to changing mind-sets, there is an urgent need to rebuild India’s PPP capacities. Structured capacity building programmes for different stakeholders including implementing agencies and customized programmes for banks and financial institutions and private sector need to be evolved. The need for a national level institution to support institutional capacity building activities must be explored. Every stakeholder without exception has strongly emphasised the urgent need for a dedicated institute for PPPs as was announced in the previous Budget. The Committee strongly endorses the “3PI” which can, in addition to functioning as a centre of excellence in PPPs, enable research, review, roll out activities to build capacity, and support more nuanced and sophisticated models of contracting and dispute redressal mechanisms (Chapter 6, paragraph 6.1.4). A dynamic 3PI can support a dynamic process of infrastructure design, build, and operate in India and thereby help deliver on the promise of reliable infrastructure services for all citizens.

8. The Committee cannot overstate the criticality of setting up of independent regulators in sectors that are going in for PPPs. The Committee recommends setting up these independent regulators with a unified mandate that encompasses activities in different infrastructure sub sectors to ensure harmonized performance by the regulators (Chapter 6, paragraph 6.1.8).

 9. The Committee welcomes the current review and amendment of the Arbitration Act, and strongly endorses the need for time limits on hearings.

10. The dominant, primary concern of the Committee was the optimal allocation of risks across PPP stakeholders. Inefficient and inequitable allocation of risk in PPPs can be a major factor in PPP failures, ultimately hurting the citizens of India. The Committee notes that the adoption of the Model Concession Agreement (MCA) has meant that project specific risks are rarely addressed by project implementation authorities in this “One-size-fits- all” approach. A rational allocation of risks can only be undertaken in sector and project-specific contexts.

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11. For the next generation of PPP Contracts, the Committee suggests the following broad guidelines while allocating and managing risks: 1) an entity should bear the risk that is in its normal course of its business; 2) an assessment needs to be carried out regarding the relative ease and efficiency of managing the risk by the entity concerned; 3) the cost effectiveness of managing the risk needs to be evaluated; 4) any overriding considerations/stipulations of a particular entity need to be factored in prior to implementing the risk management structure.

5) DEA, or preferably the 3PI, should deploy sophisticated modeling techniques that exist to assess risk probabilities and the need to provision for them; and (6) there should be ex-ante provisioning for a renegotiation framework in the bid document itself (Chapter 4, paragraph 4.1.6).

12. Typically infrastructure PPP projects span over 20-30 years and a developer often loses bargaining power related to tariffs and other matters in case there are abrupt changes in the economic or policy environment which are beyond his control. The Committee feels strongly that the private sector must be protected against what have been called “Obsolescing Bargain”-the loss of bargaining power over time by private player in PPPs-through the four mechanisms discussed in Chapter 4 including the setting up of Independent Sector Regulators.

13. PPP projects can become distressed when risks emerge that may not have been contemplated at the time of signing. This could give rise to a call for amending the terms of the Concession Agreement to reflect new project realities better (Chapter 4, paragraph 4.3.2). The Committee has suggested benchmarks in Chapter 4 to be applied to each proposed renegotiation as well as set out a set of conditions that should not be accepted as valid reasons for a request for amendment of a concession agreement (Chapter 4, paragraphs 4.3.6 and 4.3.7).

 14. The final decision on a renegotiated concession agreement must be based on 1) full disclosure of the renegotiated estimated long-term costs, risks and potential benefits; 2) comparison with the financial position for government at the time of signing the concession agreement; and 3) comparison with the existing financial position for government just prior to renegotiation. This will permit the authority regulating the Report of the Committee on Revisiting and Revitalising the PPP Model of Infrastructure xi concession to take a decision based on a full comparison of the likely outcomes over the future of the concession (Chapter 4, paragraphs 4.3.8 and 4.3.9).

15. The Committee notes that there a number of stalled PPP projects need to be kick started. There is an urgent need to evolve a suitable mechanism that evaluates and addresses “actionable stress”-using stress and adversity to deal with the underlying systemic problems (Chapter 5, paragraph 5.3.3). Sector specific institutional frameworks should be developed to address these stalled infrastructure projects. The proposed Tribunal and IPAT approach, in the Committee's view are the possible solution (Chapter 5, paragraphs 5.3.15 and 5.3.16). The Committee is of the view that only a statutorily established credible empowered multi-disciplinary expert institutional mechanism may be able to deal with the complex issues involved (Chapter 5, paragraph 5.3.4).

16. The Committee recognizes the need for a quick, equitable, efficient and enforceable dispute resolution mechanism for PPP projects. It is suggested that PPP contracts have clearly articulated dispute resolution structures that demonstrate commitment of all stakeholders and provide flexibility to restructure within the commercial and financial boundaries of the project, (Chapter 8, paragraph 8.2.1).

17. In the wake of new project proposals emerging in various infrastructure sectors, the Committee recommends that appropriate legal frameworks be developed against which these can be evaluated (Chapter 6, paragraph 6.2.1).

18. The authorities may be advised against adopting PPP structures for very small projects, since the benefits of delivering small PPP projects may not be commensurate with the resulting costs and the complexity of managing such partnerships over a long period. The transaction costs of well-structured PPP projects are significant, including essential but expensive expert advisory services (Chapter 6, paragraph 6.2.6).

19. Unsolicited Proposals (“Swiss Challenge”) may be actively discouraged as they bring information asymmetries into the procurement process and result in lack of transparency and fair and equal treatment of potential bidders in the procurement process (Chapter 6, paragraph 6.2.7).

20. Inherent in the concept of PPP is the role of a “Private Sector Partner” that will implement the project, based on the need to leverage private sector financing and also the managerial and operational efficiencies of the private sector party. It is in this context that the Committee is of the view that since state owned entities SoEs/PSUs are essentially Government entities and work within the government framework, they should not be allowed to bid for PPP projects.

 21. The authorities should not treat PPPs as an off-balance sheet funding method for the government’s responsibility of providing reliable infrastructure services to its citizens. PPPs should not be used as the first delivery mechanism without checking its suitability for a particular project. States and other agencies should also not treat Central PPP VGF as a source of additional grants that can be accessed by adopting a PPP delivery mode for projects that are not suitable for such a long-term financing structure (Chapter 6, paragraph 6.2.8).

 22. There have been concerns raised by all stakeholders (Government and Private Sector alike) on the demand for developer books of account being subjected to government audit and for access under RTI and Article 12 of Constitution. Conventional audit by authority of private partner’s books as per standard procurement process risks delivery of poor quality of service/ public asset provision if there is no certainty of processes in the medium term. To address this, the Committee recommends that the government notify comprehensive guidelines on the applicability and scope of such activities. The laid down process would enable review only of government internal systems, and not that of SPVs but SPVs would need to follow best practice in corporate governance systems including those related to related party transactions, financial disclosures etc as in the Companies Act, 2013.

23. Monetisation of viable projects that have stable revenue flows after EPC delivery may be considered. This should be seen as a monetisation opportunity that can attract risk averse long-term funding like pension and institutional investors. By providing O&M PPP opportunities, the authority will be able to free up budgetary funds for fresh EPC and start a virtuous cycle of fresh investment fed by additional revenues (Chapter 7, paragraph 7.1.8).

24. Equity in completed, successful infrastructure projects may be divested by offering to long-term investors, including overseas institutional investors as domestic and foreign institutional investors with long-term liabilities are best suited for providing such long-term financing, but have a limited appetite for risk. Cash generated out of divestment of equity would be available for the creation of new infrastructure projects in the country

25. Improving a PPP project’s risk profile so that it is more suitable for overseas and domestic long-term investors can be accomplished through partial recourse to credible third-party institutions. This could be implemented through a partial credit guarantee or cash flow support mechanisms (Chapter 6, paragraph 6.2.12).

 26. It is necessary to explore options for sourcing long term capital at low cost. Towards this, the Committee recommends, encouraging the banks and financial institution to issue Deep Discount Bonds or Zero Coupon Bonds (ZCB) (Chapter 7, paragraph 7.1.15). These will not only lower debt servicing costs in an initial phase of project but also enable the authorities to charge lower user charges in initial years.

27. Some countries have a legal framework for PPPs in the form of PPP Act/Law/Policy. MoF may develop and publish a national PPP Policy document. Ideally, such a policy Report of the Committee on Revisiting and Revitalising the PPP Model of Infrastructure xiii document should be endorsed by the Parliament as a policy resolution to impart an authoritative framework to implementing executive agencies as well as to legislative and regulatory agencies charged with oversight responsibilities (Chapter 6, paragraph 6.2.2). The Committee recommends an assessment of whether formulating and enacting a PPP Law will facilitate successful expansion of PPP into new sectors, including health, other social sectors, and urban transport (Chapter 10, paragraph 10.1.1).

28. In the final analysis, the success of deploying PPP as an additional policy instrument for creating infrastructure in India will depend on the change in attitudes and mindsets of all the authorities including public agencies partnering the private sector, government departments supervising the PPPs, and auditing and legislative institutions providing oversight of the PPPs. The PPP reflects a paradigm shift involving the private sector. It means moving away from “transaction to relationship,” accommodating “give and take” between private and public sector partners, and finally accepting uncertainties and appropriate adjustments inherent in implementing long-time contracts. The Committee urges all parties concerned to foster trust between the private sector and public sector partners in implementing PPP. As mentioned earlier in the report, PPP is an additional policy instrument to enable India to save time. Since the “demographic dead-lines” are staring at us, there is need to accelerate growth. By all accounts, there are only two or three decades left for India to complete the transition from a low-income country to a high-income and developed economy by overcoming the “middle income trap” (Chapter 10, paragraph 10.2.1). a. Contracts need to focus more on service delivery instead of fiscal benefits (Paragraph 2.5.5, viii). b. Better identification and allocation of risks between stakeholders (Paragraph 2.5.5, viii). c. Prudent utilization of viability gap funds where user charges cannot guarantee a robust revenue stream (Paragraph 2.5.5, viii). d. Improved fiscal reporting practices and careful monitoring of performance (Paragraph 2.5.5, viii). a. Given the urgency of India’s demographic transition, and the experience India has already gathered in managing PPPs, the government must move the PPP model to the next level of maturity and sophistication (Paragraph 3.1.7).

 B. KEY RECOMMENDATIONS

1.      Revisiting PPPs: Achievements and Challenges

a. Contracts need to focus more on service delivery instead of fiscal benefits

b. Better identification and allocation of risks between stakeholders

c. Prudent utilization of viability gap funds where user charges cannot guarantee a robust revenue stream .

d. Improved fiscal reporting practices and careful monitoring of performance a. Given the urgency of India’s demographic transition, and the experience India has already gathered in managing PPPs, the government must move the PPP model to the next level of maturity and sophistication.

2. Why it is Urgent for India to get Infrastructure PPPs.

a.Given the urgency of India’s demographic transition, and the experience India has already gathered in managing PPPs, the government must move the PPP model to the next level of maturity and sophistication (Paragraph 3.1.7).

b. The Committee feels strongly that maturing the PPP model in India is an urgent priority also to take advantage of this historical conjunction of India’s infrastructure needs and the availability of long-term funding

c. PPPs have the potential to deliver infrastructure projects both faster and better. Building on India’s 15 years of experience with PPPs, there is need to iron out the difficulties in the performance of PPP at every stage of the contract (Paragraph 3.5.2).

3. Re-balancing of risk Sharing :

a. An assessment needs to be carried out regarding the relative ease and efficiency of managing the risks by the entity concerned (Paragraph 4.1.6).

b. Cost effectiveness of managing the risk needs to be evaluated (Paragraph 4.1.6).

c. Sophisticated modelling techniques are prevalent to assess probabilities of risks and the need to provision for them. DEA may hone its skills in this and provide guidance to project authorities (Paragraph 4.1.6).

d. The final decision for a renegotiated Concession Agreement must be based on (Paragraph 4.3.8):

- Full disclosure of long-term costs, risks and potential benefits;

- Comparison with the financial position for government at the time of signing the Concession Agreement;

- Comparison with the financial position for government at the time prior to renegotiation.

4. Resolving Legacy Issues

 a. Only a statutorily established credible empowered multi-disciplinary expert institutional mechanism can deal with the complex issues involved (Paragraph 5.3.4):

- An Infrastructure PPP Project Review Committee (“IPRC”) may be constituted to evaluate and send its recommendations in a time-bound manner upon a reference being made of “Actionable Stress” in any Infrastructure Project developed in PPP mode beyond a notified threshold value.

- An Infrastructure PPP Adjudication Tribunal (“IPAT”) chaired by a Judicial Member (former Judge SC/Chief Justice HC) with a Technical and/or a Financial member, where benches will be constituted by the Chairperson as per needs of the matter in question

b. In case procurement of land or clearance is pending from government authorities for more than prescribed number of days, the outstanding work should be descoped (under the provisions of Change in Law of Concession Agreement), and allow rest of activities for completed work. Balance work could be completed on a cash-contract basis, provided land and required clearances are in place (Box 6).

c. Cancel projects that have not achieved a prescribed percentage of progress on the ground. Rebid them once issues have been resolved or complete them through public funds and if viable, bid out for Operations and Maintenance (Box 6).

5. Generic, Including Legacy Projects

a. Sector specific institutional frameworks may be developed to address issues for PPP infrastructure projects (Chapter 5, paragraph 5.3.15). An entity should bear the risk that is in its normal course of its business (for instance, acquisition of land is a normal course of business for public entities).Overriding considerations/ stipulations of each entity to be factored in prior to implementation of risk management structure (Chapter 4, paragraph 4.1.6).

b. Learnings from the Highways sector to be utilized for other sectors to customize and adopt such frameworks (Chapter 5, paragraph 5.3.15).

c. Umbrella guidelines may be developed for stressed projects that provide an overall framework for development and functioning of the sector specific frameworks (Chapter 5, paragraph 5.3.16).

d. DEA to finalize a national PPP Policy document (Chapter 6, paragraph 6.2.2).

e. Unsolicited Proposals (“Swiss Challenge”) to be discouraged to avoid information asymmetries and lack of transparency (Chapter 6, paragraph 6.2.7).

f. PPP structures not to be adopted for very small projects in view of the transaction costs involved. DEA to issue a threshold guidance (Chapter 6, paragraph 6.2.6).

5. Chapter 6- Strengthening Policy, Governance and Institutional Capacity

a. Amend the Prevention of Corruption Act, 1988 to distinguish between genuine errors in decision-making and acts of corruption (Paragraph 6.1.6).

b. Build up capacity in all stakeholders, including regulators, authority, consultants, financing agencies, developers (Paragraph 6.1.2).

c. Set up an institution for invigorating private investments in infrastructure, providing guidance for a national PPP policy and developments in PPP, developing a mechanism to capture and collate data for decision making, undertaking capacity building activities. The 3P-I institute for PPPs announced in 2014 may be set-up without delay (Paragraph 6.1.4).

d. Pre-qualified PPP consultancies could be empanelled by DEA as earlier which could be tapped at short notice (Paragraph 6.4.3).

e. Revive the PPP Cells supported by the DEA over the last decade in Infrastructure Ministries and State Governments (Paragraph 6.1.5).

f. An institutionalized mechanism like the National Facilitation Committee (NFC) to ensure time bound resolution of issues including getting timely clearances/approvals during implementation of projects for smooth running of such projects (Paragraph 6.2.5).

g. Ministry of Finance to coordinate with other implementing ministries may develop a policy to promote secondary market for operational assets (Paragraph 6.1.9).

h. Disallow statutory audit to books of SPVs governed by the provisions of the Companies Act. Ensure adoption of principles of good governance by the SPVs (Paragraph 6.2.3). 5) Generic, Including Legacy Projects 6. Chapter 6- Strengthening Policy, Governance and Institutional Capacity Report of the Committee on Revisiting and Revitalising the PPP Model of Infrastructure xvi

i. Standard public authority requirements of audit till point of award (public books) and post-construction discharge by Authority of monitoring and oversight of project operations as per the concession agreement (public books) to be in the purview of statutory/government audit agencies (Paragraph 6.2.3).

j. Essential to set up independent Regulators in sectors going in for PPP (Paragraph 6.1.8).

k. Discourage government participation in SPVs that implement PPP projects unless strategically essential.

7. Scaling- Up Finance

a. Restrict the number of banks in a consortium (Paragraph 7.2.3).

b. Banks to build up their own risk assessment/appraisal capabilities (Paragraph 7.2.3).

c. Check list of items listed as a guidance for lenders.

d. RBI may provide guidelines to lenders on encashment of bank guarantees in line with ICC norms (Paragraph 7.1.3).

e. Monetisation of viable projects that have stable revenue flows after EPC delivery should be considered (Paragraph 7.1.8).

f. Equity in completed, successful infrastructure projects may be divested by offering to long-term investors.

g. Ministry of Finance to allow banks and financial institutions to issue Zero Coupon Bonds which will also help to achieve soft landing for user charges in infrastructure sector (Paragraph 7.1.5).

 8. Revitalising Contractual Processes

a) Need for review of the MCAs (Paragraph 8.1.1).

b) Sample suggestions for generic changes, including for resolution of disputes, and sector-specific changes (Paragraph 8.1.4 and 8.2.1)

9. Reinvigorating the Sectors:

a. Independent sector regulators essential (Paragraph 9.2.5).

b. Build upon maturing landscape in Roads and Ports PPP and move into the next phase: Roads: avoiding delays, institutionalized dispute resolution, improved project development activity, monetization of operational assets, efficiency and transparency by electronic tolling, etc (Paragraph 9.3.6).

c. Ports: review of role and need of Tariff Authority for Major Ports (TAMP), review of MCA, quicker clearances, rationalized leases and stamp duties (Paragraphs 9.3.1-9.3.5).

d. Airport: PPPs to be encouraged where viable in Greenfield and brownfield projects, have policy that addresses potential demand for airport services in the country, notify a unified regulatory structure, clarity in delineation of Till policy,

e. Encourage use of PPPs in sectors like Railways, Urban, etc. Railways to have an independent tariff regulator, tap potentially useful PPP opportunities including brownfield assets (Paragraph 9.5.1-9.5.4).

10 .Fast Forward PPPs

a. Set up an institute of excellence in PPP to inter alia guide the sector, provide policy input, timely advice and undertake sustainable capacity building (Paragraph 10.1.3).

b. Ensure integrated development of infrastructure with roadmaps for delivery of projects (Paragraph 10.1.5).

c. India’s demographic deadlines are staring at us. There are only two or three decades left to complete the transition from a country that has just attained middle-income status to that of a high-income and developed economy. Besides the basic problems for provision of adequate infrastructure, the middle-income trap is also to be averted. Without adequate infrastructure, this will simply not be possible. India is currently in a global win-win situation with a large young population that will need good jobs and a huge pool of global savings that can be tapped for building out our infrastructure. PPPs are an important policy instrument that will enable India to compress time in this journey towards economic growth and development. A successful and growing stream of PPPs in infrastructure will go a long way in accelerating the country’s development process (Paragraph 10.2.1)

Eighth National Steering Committee on Climate Change Approves Four Projects

Eighth National Steering Committee on Climate Change Approves Four Projects

The eighth National Steering Committee on Climate Change (NSCCC) approved four projects from Tamil Nadu, Kerala and Punjab and also considered one project submitted by Government of Madhya Pradesh, at a meeting held here today. The agenda of the meeting was to consider the Detailed Project Reports (DPRs) submitted by Government of Tamil Nadu and Government of Kerala for funding under the National Adaptation Fund on Climate Change (NAFCC) and demonstration projects submitted by Government of Madhya Pradesh, Government of Punjab and Government of Tamil Nadu under Climate Change Action Programme (CCAP).

The project, titled “Management and Rehabilitation of Coastal Habitats and Biodiversity for Climate Change Adaptation and Sustainable Livelihood in Gulf of Mannar, Tamil Nadu”, has been submitted by Government of Tamil Nadu. The total cost of the project will be Rs. 24.74 crore and will cover 23 coastal villages of Tuticorin district. The 4-year project has five broad objectives: conduct baseline vulnerability studies, coral rehabilitation, sea grass rehabilitation, deployment of 6,000 Artificial Reef (AR) modules, and eco-development activities in the project villages. The project will help in developing the much needed “Comprehensive Plan or Scheme for Coral and Sea Grass Restoration”. It will augment the database on coral ecosystem, species diversity, fish catch/effort, anthropogenic pressure, and migration & survival rate. The project activities will lead to economic empowerment of 15 SHGs per village and benefit about 6,900 women. The project will create a platform for knowledge development through regular meeting amongst departments like fisheries, forest, TNSCCC, GOMBRT, IIT, Chennai, Anna University and facilitate planning of roadmap for future conservation efforts. It is estimated that the cumulative potential for revenue generation per annum is about Rs. 1.84 crore for fisherman community and Rs. 1.03 crore for the Women Self Help Groups (SHGs). The Department of Environment and State Steering Committee of Tamil Nadu will be responsible for facilitating overall project implementation.

Another project titled ‘Promotion of Integrated Farming System of Kaipad and Pokkali in Coastal Wetlands of Kerala’ has been submitted by Government of Kerala. The total cost of the project Rs. 33.73 crore envisions integrated farming methods, as climate smart practices to enhance resilience of aquaculture communities to climate change especially sea-level rise that results in severe intrusion of salinity. The proposed area for the 4-year project is 600 hectares (300 hectares in Kannur District and 300 hectares in Ernakulam, Thrissur and Alappuzha districts) has as its broad objectives - providing the main infrastructure facility of strong outer ‘bunds’ with sufficient height; use of tall varieties of salt tolerant paddy; integrating fishery to enhance paddy cultivation and maximize the inland fish production through sustainable aquaculture. The Agency for Development of Aquaculture (ADAK), Department of Fisheries, Government of Kerala, will be the Executing Entity for the project. The project will help simultaneous cultivation of rice and shrimp / fish in low-lying wetlands where there were no cultivation earlier. It will also improve the quality of life for local farmers through higher disposable incomes. It will improve access to fresh water, as peripheral ‘bunds’ will prevent seepage of sea water to fresh water sources, capacity building of farmers and will reduce displacement of labourers from nearby areas and provide employment to women. It will also check carbon emission, as wetlands have good potential to act as carbon sink. It is estimated that the cumulative potential for total annual revenue is about Rs. 23.25 crore under this project.

Under Climate Change Action Programme, the Committee considered three projects on “Building Resilience through Integrated Farming Systems for Enhancing Livelihood Security” submitted by Government of Madhya Pradesh, “Technological adaptation for gainful utilisation of paddy straw (presently burnt on-site) as fuel to replace fossil fuels” submitted by Government of Punjab and ‘Coastal habitat rehabilitation for climate change adaptation in Gulf of Mannar, South-Eastern India: Improving ecosystem services and Fisherman livelihood” by Government of Tamil Nadu. The committee approved the projects from Government of Punjab and Government of Tamil Nadu at an estimated cost of Rs. 3.54 crore and Rs. 67 lakh respectively. The meeting was held under the Chairmanship of Shri Ashok Lavasa, Secretary Ministry of Environment, Forest and Climate Change (MoEF&CC).

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Achievements of Department of Space during the year 2015

Year End Review: Achievements of Department of Space during the year 2015

Following are the significant achievements and details of the Innovative Programmes launched by the Department of Space during the year 2015:

​

1.             MARS Orbiter Mission:

India's Mars Orbiter Spacecraft has successfully completed its mission objective as planned and has completed one year around Mars orbit on September 24, 2015. It was successfully placed into an elliptical orbit around planet Mars on September 24, 2014. The Mars Orbiter successfully came out of the solar conjunction (a phase of communication blackout) in July 2015 using the On-board autonomy built in the spacecraft. The Spacecraft is in good health and all the five scientific payloads are providing valuable data about the Mars surface features and Martian atmosphere. The images of Mars captured by the Mars Colour Camera have been found to be of very good quality.  The increased duration of observation of Mars by five scientific payloads beyond the designed life of six months is enabling enhanced coverage of Mars in different seasons. A book titled ‘From Fishing Hamlet to Red Planet’, India’s space Journey, with series of articles from luminaries from ISRO, was released on November 05, 2015, on the second anniversary of Mars Orbiter spacecraft launch. 

By successfully placing Mars Orbiter Spacecraft around Mars, ISRO has become the fourth space agency to successfully send a spacecraft to Mars orbit and India became the first country in the world to do so in its first attempt. The mission has benefited the country by (i) Upgrading the technological capabilities in spacecraft design including onboard autonomy, miniaturization, optimization of onboard resources (ii) providing excellent opportunities in planetary research for the scientific community and (iii) generating interest in youth of the country towards science and technology.

Mars Orbiter Mission has been awarded “Space Pioneer Award” for science  and engineering category for the year 2015 by the US based National Space Society. The Indira Gandhi Prize for Peace, Disarmament and Development has been awarded to ISRO in recognition of its path-breaking.

2.              ​Successful launch of GSLV with Indigenous Cryogenic Stage:

On Aug 27, 2015, Geo-Synchronous Satellite Launch Vehicle (GSLV-D6), equipped with the indigenous Cryogenic Upper Stage (CUS), successfully launched GSAT-6, the country's advanced communication satellite, into a Geosynchronous Transfer Orbit (GTO). This was the second consecutively successful flight of GSLV with the indigenous CUS, which underscores the success of ISRO in mastering the highly complex cryogenic rocket propulsion technology. This launch also signifies a major step forward in achieving the self reliance in launching 2 Ton class communication satellites into GTO.

3.              Development of Next Generation Geo-Synchronous Satellite Launch Vehicle Mk III:

 ​The first experimental flight of heavy lift next generation launch vehicle, GSLV-Mk III, was successfully conducted on December 18, 2014 from Sriharikota. This flight has validated the complex atmospheric regime of flight and demonstrated the Integrity of design of GSLV Mk III.

​During the experimental flight of GSLV Mk III, the unmanned Crew module Atmospheric Re-entry Experiment (CARE) has also been successfully tested for its re-entry performance. Crew module splashed down over Andaman Sea with the help of its parachutes and was recovered from the sea with the help of Indian Coast Guard as per the mission plan.

​Endurance hot test of High Thrust cryogenic engine (CE20) of GSLV-Mk III was successfully conducted on July 20, 2015.  The test was conducted for 800 seconds as compared to its nominal burn duration of 635 seconds during flight. This engine will be used for powering the Cryogenic stage (C25) of GSLV Mk-III launch vehicle. Another short duration (5.7 s) hot test on the CE20 engine has been carried out on Aug 10, 2015 to demonstrate the successful engine ignition with tank pressure conditions as in flight.

GSLV Mk III is designed to launch 3.5 to 4 Ton class communication satellites to Geosynchronous Transfer Orbit.

4.              Navigational Satellite System:

Indian Regional Navigational Satellite System (IRNSS) is designed as a constellation of seven satellites to provide satellite based navigational services in the country. 

IRNSS-1C, the third Navigational satellite of India, was successfully launched on-board Polar Satellite launch Vehicle PSLV-C26 on October 16, 2014. IRNSS-1D, the fourth satellite in this series was successfully launched on-board PSLV-C27 on March 28, 2015.  The first two satellites viz. IRNSS 1A &1B were launched on-board PSLV earlier on July 01, 2013 and April 04, 2014 respectively.

With the operationalisation of four navigational satellites in orbit, it is now possible to provide Position, Navigation and Timing services. The IRNSS constellation of seven satellites is expected to be completed by 2016.

​The IRNSS System will benefit the country by providing positioning services over Indian Land Mass and a region extending to the about 1500 Kms around India. The convergence of communication, earth observation and navigation satellite technologies will prove to be a boon in coming years for location based services and informed decision making.

GAGAN (GPS Aided GEO Augmented Navigation), which is primarily being used in aviation sector for precise position information services, has been certified by DGCA for Navigation Performance level of Approach with Vertical Guidance (APV-1) over India. With this, India becomes the Third country in the world, after USA and European Union, to offer Global Navigational Satellite System (GNSS) based precision approach services to civil aviation sector. The GAGAN System jointly developed by ISRO and AAI is a giant leap forward in the development of GNSS services in India and will redefine navigation in both aviation and non-aviation application areas.

5.             ​ Augmenting the Satellite Communications infrastructure:

GSAT-15, a 3 ton class communication satellite (carrying 24 Ku band transponders & GAGAN payload) has been successfully launched on November 11, 2015 at 3.04 hrs IST. GSAT-15 will further augment the INSAT/GSAT system capacity for DTH, TV broadcasting, Digital Satellite News Gathering and VSAT services and other societal benefits. 

GSAT-6, the country's Advanced Communication Satellite (carrying S-Band payload with 5 spot beams & C-Band Payload with one beam) was successfully launched on Aug 27, 2015 into a Geosynchronous Transfer Orbit. S-Band Unfurlable Antenna of 6 meter diameter was successfully deployed on August 30, 2015. The satellite has now been positioned in its designated orbital slot of 83 degree East longitude. GSAT-6 is intended to be used for satellite based mobile communications with hand held terminals for strategic applications.

6.             ​ India’s first multi-wavelength Observatory in Space:

​ASTROSAT satellite, India’s first dedicated astronomy satellite was successfully launched by PSLV-C30 on September 28, 2015. ASTROSAT enables simultaneous Ultraviolet to X-Ray observations to study Stars and Galaxies. It will also provide opportunity to task observations for the scientific community.

​ASTROSAT is a unique mission with combination of scientific instruments covering near ultra-violet, far ultra-violet and x-ray bands for multi wavelength observations.  The ultra-violet imaging telescope of ASTROSAT has a best resolution of 1.8 arc second combined with large field of view.  ASTROSAT is a vital contribution of India to the Global research community in the area of Astronomy.

7.              Commercial Launch of PSLV:

India's Polar Satellite Launch Vehicle has launched 17 foreign satellites from seven countries (Canada, Indonesia, Singapore, UK, and USA) during 2015 as given below:

(a) India's Polar Satellite Launch Vehicle, PSLV-C28, successfully launched five satellites from United Kingdom viz. DMC3-1, DMC3-2, DMC3-3, CBNT-1 and De-orbitsail from Satish Dhawan Space Centre (SDSC), Sriharikota on July 10, 2015 from Satish Dhawan Space Centre SHAR, Sriharikota.

(b) PSLV-C30, along with ASTROSAT has successfully launched six co-passenger satellites, 4 LEMUR Satellites (USA), Lapan-A2 (Indonesia) ; NLS-14 (Canada) on September 28, 2015.

(c) PSLV-C29 has successfully launched six satellites of Singapore. Of these six satellites, TeLEOS-1 is the primary satellite whereas the other five are co-passenger satellites which include two microsatellites (VELOX-CI, Kent Ridge-1) and three nano satellites (VELOX-II, Athenoxat-1, Galassia)

During the year 2015, a total of 17 foreign satellites were successfully launched from India which takes the total number of foreign satellites launched to 57.

8.              National Meet on promoting Space Technology based tools and Applications on Governance & Development: 

​ The one day National Meet on promoting Space Technology based tools and Applications on Governance & Development was organized on September 07, 2015 at Vigyan Bhavan, New Delhi to deliberate on the action plans of various Ministries/Departments. The National Meet received an overwhelming response with participation of more than 1200 delegates across 60 Central Ministries/Departments, 28 States and 5 Union Territories. Secretaries, Additional Secretaries, Joint Secretaries to Government of India, Chief Secretaries, Principal Secretaries of the States and senior functionaries of Central and State Governments, officials from Prime Minister Office & Cabinet Secretariat, young administrators (the fresh batch of 2013 IAS officers), experts from academia and institutions have actively participated in this Meet.

The National  Meet comprised of Nine theme sessions (Agriculture, Energy & Environment, Infrastructure Planning, Water Resources, Technology Diffusion, Developmental Planning, Communication & Navigation, Weather & Disaster Management and Health & Education) addressing different domains of national development. Secretaries of 58 Ministries/Departments have presented the joint action plans to enhance functional effectiveness, facilitate planning and decision making. Chief Secretaries/ Principal Secretaries of 9 States have also made presentations on use of space technology in specific sectors.

​ A Special Session was conducted in the presence of the Prime Minister Shri Narendra Modi.  In his remarks, the Prime Minister emphasized the need for new initiatives in all the areas of governance, using the space technology and applications. He asserted that technology is the most powerful medium that the Government has to utilize to ensure good governance, transparency and accountability. 

9.              ​Initiatives on Satellite for SAARC Region:

​ISRO/DOS, with active support from Ministry of External Affairs (MEA), hosted a Conference on “Satellite for the SAARC region and Space Technology Applications” on June 22, 2015 at New Delhi.  The conference deliberated on configuration and ground Infrastructure requirements for the proposed ‘Satellite for the SAARC region’ as well as other space technology applications. Representatives from all SAARC member countries have participated.

10.          Disaster Management Support:

​The Indian Remote Sensing, Meteorological and Communication satellites have immensely helped in the management of recent events of disasters witnessed by the country viz. J&K Floods, HudHud Cyclone and J&K Landslides. These satellites have provided near real time support in terms of early warning, assessment of damages, emergency communication. The massive landslides blocking Sun Koshi River in Northern Nepal in August 2014 and Phuktal River in Zanskar region of J&K in January-March 2015 were monitored regularly using Indian Remote Sensing Satellites. Flood inundation maps and information on their progression & recession were disseminated on daily basis to concerned agencies.

During the recent earthquake in Nepal, remote sensing data obtained from Indian and foreign satellites was analyzed in near real time to identify the collapsed structures and new landslides resulted due to earthquake in parts of Nepal. The processed information derived from satellite data was provided to National agencies viz. Ministry of Home Affairs (MHA), National Disaster Management Authority (NDMA) and National Disaster response Force (NDRF) and also to international agencies viz., British Army, UK; International Centre for Integrated Mountain Development (ICIMOD), Nepal; National Intelligence Agency of US, and UNOSAT and other relief teams of Nepal, Korea, Russia, France, Germany etc. for unifying the efforts and coordinating rescue operations.

Innovative Programmes launched and its expected positive impact on the general public:

1.             Identifying the water bodies in tribal dominated districts, which could be

developed to culture fisheries

Tribal inhabitants require regular income mechanisms, instead of current assistance protocols delivering resource only in periodical fashion. Ministry of Tribal Affairs has programme on identifying existing and potential water collection spots which could be developed for fish culture using Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA). This scheme is for 168 Tribal dominated districts (> 25 % tribal population) in 24 States/UTs.

ISRO has provided maps for small water bodies generated using satellite data. In order to use these satellite based maps, capacity building for the state level officials has been done in Odisha, West Bengal, North-East, Gujarat and Jharkhand. This enables identifying existing water bodies and identifying new sites, wherein Runoff can be harvested for fish cultivation along with conventional farming.

​Water body database will be used to plan enhancement of fishery as livelihood alternative or livelihood augmentation in tribal areas. Small water body based fishery can help tribal inhabitants to get regular nutrition as well as income.

2.              Monitoring and evaluation of developmental activities in the watersheds

​Department of Land Resources programme on Integrated Watershed Management Programme (IWMP) is for restoring the ecological balance by harnessing, conserving and developing degraded natural resources such as soil, vegetative cover and water.

​ISRO is providing online satellite data, tools and mobile app through Bhuvan geoportal for monitoring of watershed developmental activities for about 52,000 micro-watersheds in 10 States and 50 identified districts across the country. Capacity building is also being provided to DoLR officials in utilizing the Bhuvan tools for satellite data, GIS and mobile apps. The effective implementation of the IWMP will ensure Optimal soil & water conservation and assured crop irrigation due to water resources harvesting which help to provide sustainable livelihoods to the people residing in the watershed area.

​Farmers get their livelihood on sustainable basis due to biomass improvement also. De-silting of tanks and other watershed activities that provide employment generation under MNREGA are also being evaluated using satellite data.

3.              Space Based Information Support for Decentralized Planning:

​Using high resolution satellite data, state-wise natural resource database is being generated for the entire country at 1:10000 scale.  This spatial data base integrated with field level information and traditional wisdom helps in preparation of locale-specific action plans for land & water management for development of their locality. The availability of such information at grass root level enables decentralized planning and empowering panchayats in decision making.

​Bhuvan Panchayat Portal provides functionalities required to carry out the decentralized planning process at grass-root level. Citizens in general and three tiers of Panchayati Raj Institutions (PRIs) (Gram Panchayat, Block Panchayat and District Panchayat) in particular are the users of the Portal. It helps PRIs in tracking the progress of work undertaken by citizens under various schemes.

4.              ​Conservation of heritage sites

The conservation of world heritage sites, ancient monuments and archaeological sites is of national importance and helps in development and promotion of Tourism, which is one of the major engines of economic growth. The systematic database of heritage sites and Site Management Plans generated using space technology will help to take informed decisions in conservation, preservation and monitoring activities of the site. The space based technology tools are also being planned for mapping and identification of vulnerability of each monument and preparation of plans to track and mitigate environmental or weather changes that may have an adverse impact on fragile monuments. 

5.              Automated warnings at unmanned level crossings

Pilot studies for automatic warnings at unmanned level crossings have been carried out using GAGAN, Rail-Navigator tools; MSS based tracking system and Bhuvan.  It comprises of a geospatial database on the accurate locations (geographical coordinates) of unmanned level crossings and GAGAN enabled devices mounted on the train engine.  A train mounted with such a device would know the location of unmanned level crossing and train’s hooter will automatically start when it approaches near to an unmanned crossing. Expert committees/ Councils are setup by Railways to discuss and finalize the modalities of implementation.

6.              Weather and Climate

​ Indian meteorological satellites provide synoptic measurement and derivation of various weather parameters such as cloud motion vectors, cloud top temperature, water vapour, humidity, rainfall at frequent intervals to aid in improved weather forecasting, including the genesis of cyclones, their track and landfall prediction.

The data products are disseminated through web based services for the needs of scientific community in the country. Also, Android Application has been developed for viewing 3 hourly weather forecasts.

7.              Bhuvan Geoportal

​ It is providing seamless high resolution remote sensing data (1m to 2.5m) for visualization, terrain data and thematic layer overlays of Indian region along with host of services in the areas of disaster, weather, land and ocean for general public. It has about 51,000 registered users and has served more than 2.8 lakhs downloads.

On 12th August 2015, the Union Minister of State (Independent Charge) Development of North-Eastern Region (DoNER), MoS PMO, Personnel, Public Grievances & Pensions, Atomic Energy and Space, Dr. Jitendra Singh, released New services of Bhuvan. The new application services include – 1 m images of over 300 Cities of the country and host of visualization applications for common man.

8.              ​Data Connectivity to Rural India

​DOS/ISRO has fast-tracked the realization and launch of GSAT-11 communication satellite.  GSAT-11 is an advanced communication satellite with Ku and Ka Band communication payload capable of providing upto 10 Gbps throughput.  With such capacity, this satellite is expected to provide high bandwidth data connectivity for rural India as envisaged under Digital India.  Satellite structure is already realized and payload fabrication is in progress.  Initiatives have been taken to accelerate the development and realization of other critical subsystems of thesatellite.  The satellite is targeted for launch in the year 2017.

Govt launches 22 new schemes under Digital India programme

Initiatives in areas such as digital infrastructure, digital empowerment and on-demand govt services unveiled

The government on Monday expanded its Digital India programme, launching new initiatives and broadening the scope of existing ones, to make more services accessible to the masses.

The 22 initiatives launched under the Digital India programme include projects in the areas of digital infrastructure, digital empowerment, on-demand government services and promotion of industry.

Under the programme, Prime Minister Narendra Modi plans to provide government services online, expand Internet connectivity to rural areas and boost manufacturing of electronic goods in the country.

“If the Atal Bihari Vajpayee government is remembered for laying down national highways, the Narendra Modi government will be known to have laid the digital highway of the country,” communications minister Ravi Shankar Prasad said while launching the initiatives in New Delhi.

The services launched on Monday include electronic payments for government services, a geographical information system (GIS)-based decision-support system, a request for proposal for selecting private cloud service providers for government departments, the setting up of an online laboratory for students to perform virtual experiments for all Central Board of Secondary Education (CBSE) schools, the incubation of 10 projects in the area of chip-to-system design and the development of a native operating system that will support text-to-speech technology for nine regional languages.

The government also announced the start of a new data centre for the National Informatics Centre (NIC) in Odisha entailing an investment Rs.189 crore and eight new software technology parks with an investment of Rs.78 crore. The new centres will take the total number of such parks in India to 62.

Prasad awarded three states and 55 districts across the country for significant contributions towards digital inclusion and innovative solutions.

“We would want all states to study the success of other states and emulate,” he said. He urged district magistrates and information officers to cooperate at the ground level to improve e-governance.

The government is also working on the concept of digital villages—rural areas that will have telemedicine facilities, virtual classes and solar power-based WiFi hot spots.

Speaking at the function, information technology secretary J.S. Deepak said digital governance is the best way to reach the remotest corners of the country.

“The basic objective should be to scale, because unless services are taken to the masses, digital inclusion will not succeed as asymmetry of information leads to asymmetry of opportunity,” he remarked.

Deepak said the curbs put on the use of Aadhaar unique identification number programme has made it difficult to implement Digital India initiatives.

The Supreme Court has through two orders limited the use of Aadhaar to the public distribution system, the distribution of cooking gas and kerosene, the rural jobs guarantee scheme, the Pradhan Mantri Jan Dhan Yojana, central and state government pensions and the Employees’ Provident Fund Scheme. The issue of whether Aadhaar violates privacy has been referred to a constitution bench of the court, which is still to be constituted.

Prasad said the communications ministry is committed to the launch of the payments bank of India Post by March 2017.

The Reserve Bank of India in August gave initial approval to 11 entities, including India Post, to set up payments banks within a period of 18 months. Prasad requested Kavery Banerjee, secretary, department of posts, to adhere to the timeline.

Banerjee, in her address, said the department of posts is working towards making all postal transactions real-time and rolling out citizen-centric services. She announced that the current banking customers of the postal department will have access to mobile and Internet banking by early next year.

Communications minister Prasad also announced that state-run Mahanagar Telecom Nigam Ltd (MTNL) will offer free roaming services for incoming calls across the country starting 1 January.

Why it’s imperative for Parliament to move into a new building

While the structure has aged, the number of Lok Sabha seats is likely to increase after 2026

The 88-year-old Parliament House (or Sansad Bhavan in Hindi) may well move to a new building, if a proposal by Lok Sabha speaker Sumitra Mahajan on Sunday is implemented.

But first, a brief history of Parliament House, as we know it. According to the Parliament’s website, “The foundation stone of parliament house was laid on 12th February, 1921 by HRH The Duke of Connaught. The construction of the building took six years and the opening ceremony was performed on the 18th January, 1927 by the then Governor-General of India, Lord Irwin. The cost of construction wasRs.83 lakh.” Parliament House, originally known as the House of Parliament, was designed by British architects Sir Edwin Lutyens and Sir Herbert Baker around 1912-13.

The building is “a massive circular edifice, 560 feet (170.69 meters) in diameter. Its circumference is one-third of a mile (536.33 meters) and it covers an area of nearly six acres (24281.16 square metres). The open verandah on the first floor is fringed with a colonnade of 144 creamy sandstone columns—each 27 feet (8.23 metres) high. The building has twelve gates among which Gate No. 1 on the Sansad Marg is the main gate.”

New building proposals

In her letter to the Urban Development ministry, Mahajan wrote, “On account of ageing of the Parliament House building and expansion in activities, staff etc, the building has shown signs of distress and over utilization...Under the circumstances, there is an imperative need for the construction of a new state-of-art Parliament building.” Besides, with the Parliament House being declared a “Heritage Grade-I” structure, “there are several limitations on the structural repairs, additions, alterations and modifications”.

A Press Trust of India report said Mahajan suggested two options—one, the new building can be constructed within the existing Parliament complex, which “would require relocation of certain facilities and services”. The second option would see the new Parliament building come up on the other side of Rajpath, which is a “suitably large area and would enable a free design of a new Parliament House building”.

This is not the first time that such a proposal has come up. In July 2012, then Lok Sabha speaker Meira Kumar approved the setting up of a “high-powered committee to suggest an alternative complex”. Subsequently, The Hindureported that a report prepared by the Union Urban Development ministry, which was submitted to the Lok Sabha Secretariat, had recommended “that a new structure can be built across the Vijay Path as was envisaged by Sir Edward (sic) Lutyens himself”.

The report in The Hindu quoted an unnamed official as saying, “While planning the buildings around Raisina Hill, Lutyens had thought of a circular building, a mirror image of Parliament House on the Southern Side of the Vijay Chowk. The plot that was marked for this construction is currently being used as temporary barracks. This land can be used for building a new House that will address the current space and safety concerns.”

The report added, “The ministry has suggested that the new building can be made to resemble the existing House on the outside, but the interiors can be designed to accommodate the needs of the MPs. Both buildings can be connected through a tunnel passing right under Vijay Chowk. The second option, the Lok Sabha Secretariat has been informed, is using the space adjacent to Gurdwara Rakab Ganj Road where government properties stand.”

Similarly, “about a year ago, a suggestion to build a new Parliament was reportedly made at a meeting of budget committee of parliament including deputy speaker of the Lok Sabha M. Thambidurai, public accounts committee chairman K.V. Thomas and estimates committee chairman Murli Manohar Joshi. Thomas said that the existing building was ‘old’ and a new Parliament building should be thought of as provision needed to be made for the next 100 years,” said the PTI report

Why a new building?

Besides age, the fundamental case for a new Parliament building, as Mahajan said, arises from the fact that the number of seats in the Lok Sabha is likely to go up after 2026.

This is in accordance with the “provisions of the explanation to clause (3) Article 81 of the Constitution”. The clause “determines representation on the basis of population determined by the last census”, which in this case will be the 2021 census.

Digitization of PDS helped plug Rs4,200 crore in leakages: centre

GOOD EXAMPLE OF E-GOVERNANCE

Digitization of PDS helped plug Rs4,200 crore in leakages: centre

As a result of govt’s efforts, 6.14 million bogus or duplicate ration cards have been cancelled in the past two years, says food ministry

Cleaning up the back-end of the subsidized public distribution system (PDS) has helped weed out over 6 million bogus ration cards, plugging leaks to the tune ofRs.4,200 crore in two years, the food ministry said on Monday.

In its bid to better target subsidies and ensure leakage-free distribution of foodgrains, the government used direct benefit transfer (DBT) and automated ration shops, a statement issued by the ministry said.

DBT allows the transfer of subsidies to bank accounts of beneficiaries, who then buy food from the open market. Automation ensures foodgrains are distributed via ration shops through point-of-sale (PoS) devices that authenticate beneficiaries and record the quantity of subsidized grains given to a family.

While DBT is presently used in only the Union territories of Chandigarh and Puducherry, PoS devices are used in 59,500 ration shops. The target is to scale this up to 150,000 shops by March 2016 and 542,000 by March 2017, the ministry said.

States are using central assistance to install PoS devices in ration shops that are linked to the Aadhaar unique identification numbers of beneficiaries.

The linking of Aadhaar numbers with ration cards has gone up from 8% to 39% between April and December, the food ministry said.

As a result of these efforts, 6.14 million bogus or duplicate ration cards have been cancelled in the past two years, stopping the diversion and misuse of PDS foodgrains amounting to about Rs.4,200 crore.

Plugging leaks in PDS through digitization comes on top of the DBT scheme for subsidized domestic gas.

Under DBT for LPG, or the Pahal Scheme, 147.4 million beneficiaries have received Rs.29,826 crore in their bank accounts since the scheme was relaunched in November 2014. The government expects to save Rs.15,000 crore in LPG subsidy every year that would have been lost to leakages.

To successfully implement the National Food Security Act (NFSA), the central government has focused on end-to-end computerization, which will bring transparency and check leakages and diversion of foodgrain, the food ministry said in its statement.

So far, the beneficiary database has been digitized in 33 states and Union territories, while 17 states and Union territories are being allocated foodgrains online. In nine states and Union territories, the entire supply chain has been computerized.

The food law was enacted by Parliament in 2013 and entitles beneficiary households to draw 5kg of foodgrains per person per month at a subsidized price of Rs.2-3 per kg. The scheme is expected to cost the government Rs.1.2 trillion in 2015-16.

While 11 states and Union territories are yet to implement the law, 25 have done so. States that are yet to roll out the law include Uttar Pradesh, Gujarat, Tamil Nadu and Kerala.

Presently, around 530 million people have been brought under the law.

A committee on restructuring the Food Corporation of India suggested in its report submitted in January that the government begin direct cash transfers of food subsidy because the existing delivery mechanisms lead to a leakage of as much as 47%. It estimated that cash transfers alone could save the exchequer Rs.30,000 crore every year.