Transforming India’s Fair Price Shops: MoUs Inked to Boost Entrepreneurship and Digitalization

To transform the Fair Price Shops (FPSs) in India and align them with the Hon’ble Prime Minister’s vision of Kushal Bharat, Viksit Bharat and Digital India, the Department of Food and Public Distribution has entered into two MoUs with the Ministry of Skill Development and Entrepreneurship (MSDE) and the Small Industries Development Bank of India (SIDBI).

The Department of Food & Public Distribution (DoF&PD) signed an MoU with the National Institute for Entrepreneurship and Small Business Development, NIESBUD under Ministry of Skill Development and Entrepreneurship (MSDE), to tackle skill development challenges faced by FPS dealers, particularly in areas of digital literacy, financial literacy and entrepreneurial skills needed to adapt to the market changes and explore new business opportunities. The MoU was signed on 14th March 2024 at Kaushal Bhawan, New Delhi by Shri Ravi Shankar, Director, DoFPD and Dr. Poonam Sinha, Director, NIESBUD in the presence of Shri Dharmendra Pradhan, Union Minister for Education, Skill Development & Entrepreneurship. Shri Sanjeev Chopra, Secretary, DoF&PD and Shri Atul Kumar Tiwari, Secretary, MSDE were also present on the occasion.

Speaking on the occasion, Shri Sanjeev Chopra, Secretary, Department of Food & Public Distribution, highlighted, “By improving entrepreneurial capabilities, FPS owners can expand their services, enhance customer satisfaction, and pursue additional sources of income. Moreover, enhancing digital and entrepreneurial skills among FPS owners enables effective use of technology, streamlining operations, and reinforcing customer orientation practices.”

Another MoU between DoF&PD and SIDBI was entered into on 15th March, 2024 at Krishi Bhawan, New Delhi. The MoU was signed by Shri Rajendra Kumar, Joint Secretary, DFPD and Shri. Ravi Tyagi, Chief General Manager, SIDBI in the presence of Shri Sanjeev Chopra, Secretary, Does FPD and Shri Prakash Kumar, Deputy Managing Director, SIDBI. Through this partnership, SIDBI will offer a simple-to-use digital solution for providing working capital assistance to the FPSs through its GST Sahay application. This initiative will enable FPS to operate on a credit model for selling non-PDS commodities.

“The government plans to introduce pilot programs aimed at transforming FPSs into nutrition hubs and smart FPSs. The goal is to turn FPSs into nutrition hubs that leverage technology in their operations and also offer a diverse range of nutrient-rich non-PDS commodities to the public, going beyond the distribution of food grains. SIDBI’s invoice financing will play a pivotal role in addressing the challenge of lack of credit for working capital, hindering FPS dealers’ ability to stock and sell non-PDS commodities” emphasized Shri Chopra on the occasion.

Shri Prakash Kumar, DMD, SIDBI said, “In line with its mandate to promote entrepreneurship by supporting micro and small businesses, it is a proud moment for SIDBI to be associated with this important program which is for the benefit of all the citizens of the country, besides promoting entrepreneurship. SIDBI has completely digitized its credit operations and for the proposed program it shall use the latest digital technology and best-in-class Digital Public Infrastructure (DPI) of the country to create a customized credit program using GST Sahay Platform for FPSs”.

The two MoUs are a breakthrough in the area of capacity building and opening investment & financing opportunities for FPSs in the country. The two agreements will significantly elevate employability and enhance the livelihood of FPS dealers.

The Department of Food and Public Distribution has consistently and comprehensively deliberated on strengthening food security in the country. The department has taken various initiatives in this direction. Recently, it launched a pilot project to onboard FPSs on the Open Network Digital Commerce (ONDC). It provides numerous benefits for FPS dealers including visibility in the digital marketplace, access to a larger customer base beyond NFSA beneficiaries, and the ability to compete on an equal footing with large retailers and e-commerce platforms. Additionally, beneficiaries who face difficulties in making online purchases can approach the FPS dealer to make online orders on their behalf. The All-India Dealers Federation, represented by Shri. Saurabh Gupta participated in today’s MoU signing event with SIDBI and welcomed the initiative.

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