Chandigarh will become the first union territory (UT) in the country to undertake a full-scale rollout of a Central Bank Digital Currency (CBDC)-based Direct Benefit Transfer (DBT) system for food subsidy under the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) on August 14.
Under the new system, beneficiaries will receive food subsidies through the Digital Rupee (e ₹), which will be programmed specifically for purchasing entitled foodgrains such as wheat and rice from authorised merchants.
The launch will be presided over by Punjab governor and UT administrator Gulab Chand Kataria. Union agriculture and farmers welfare minister Shivraj Singh Chouhan will be the chief guest, while Union minister for education, consumer affairs, food and public distribution and new and renewable energy Pralhad Joshi will be the special guest.
The initiative marks a shift in welfare delivery — from physical distribution of subsidised foodgrains to DBT and now to purpose-bound digital delivery through CBDC.
How will the system work?
Under the CBDC model, the digital subsidy amount credited to beneficiaries will have a defined purpose and cannot be used for any other transaction.
Beneficiaries will visit empanelled merchants, scan a QR code and complete the purchase of eligible foodgrains using the Digital Rupee.
The key feature of CBDC is programmability, which allows the digital benefit to remain linked to its intended purpose, ensuring that the subsidy reaches the beneficiary and is utilised only for the purchase of specified commodities.
Officials said the system is aimed at improving transparency, traceability, accountability and efficiency in welfare delivery while keeping the process simple for citizens.
Chandigarh was among the first regions to implement the DBT model for food subsidy in September 2015, replacing physical distribution of subsidised foodgrains with direct transfer of subsidy into Aadhaar-linked bank accounts of eligible households.
The CBDC initiative builds upon this existing DBT framework by adding an additional layer of digital tracking and purpose restriction.
The CBDC pilot was earlier initiated in Gujarat, Puducherry and Chandigarh to explore the use of Digital Rupee for targeted welfare delivery.
During the event, the Union minister will also remotely launch the CBDC-based initiative for Dadra and Nagar Haveli from Chandigarh, marking further expansion of the technology-driven food subsidy delivery system.
Leave a comment