Govt of India Debuts CBDC Digital Food Coupon Pilot Program in Gujarat

The Government has launched a pilot of a Central Bank Digital Currency (CBDC)-based Public Distribution System (PDS) in Gandhinagar, Gujarat.  

As per PIB reports, the programme was introduced at Mahatma Mandir in the presence of Union Home Minister Amit Shah, Union Consumer Affairs Minister Prahlad Joshi, and officials from the Centre, the Gujarat government and the Reserve Bank of India. 

Pilot Across Selected Districts 

The project will begin in 4 districts, Ahmedabad, Surat, Anand, and Valsad. More than 26,000 beneficiary families are expected to be covered in the initial phase. Each household will receive digital tokens credited to a wallet linked to the digital rupee. 

These tokens can be used to collect entitled foodgrains at Fair Price Shops. Transactions will take place through QR codes or voucher codes at the shop. 

Digital Coupons for Ration Purchases 

Under the pilot, programmable digital rupee (e₹) coupons are generated within the Reserve Bank of India’s CBDC framework. The coupons carry information on the item, quantity and price, and are credited directly to beneficiaries’ wallets. 

The coupons can only be used for ration purchases. The system records each transaction digitally and removes the need for repeated biometric authentication at the point of sale. 

Part Of Ongoing System Changes 

India’s Public Distribution System serves more than 80 crore beneficiaries. In recent years, the system has been digitised through measures such as online ration cards, Aadhaar-enabled e-POS devices and the One Nation One Ration Card scheme. 

The CBDC pilot adds a digital payment layer to these existing systems. It forms part of an effort to integrate technology into the food distribution network. 

Expansion and Related Initiatives 

Reports also suggest that the pilot may later be extended to Union Territories including Chandigarh, Puducherry, Dadra and Nagar Haveli and Daman and Diu.  

During the event, an ‘Annapurti’ grain ATM was also introduced in Ahmedabad, which can dispense up to 25 kilograms of grain in about 35 seconds. 

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Conclusion  

Gujarat is the first state to test digital rupee-based ration distribution under the PDS. The project will be extended to select Union Territories in subsequent stages. 

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