Subsidies & PDS, e-commerce; Green, White and Blue Revolutions MCQ - Practice Questions with Answers

The Public Distribution System is a food-security mechanism, not an online marketplace. It supplies essential foodgrains to eligible ration-card households through fair price shops, with the NFSA framework giving the legal food-security context. The note also connects PDS with procurement, storage and public distribution channels. Online sale of consumer goods belongs to e-commerce, where digital platforms, payments, logistics, sellers and buyers interact. Confusing PDS with e-commerce is a basic conceptual trap.

Targeted support can make spending more focused and pro-poor, so it is often discussed as a way to reduce waste and fiscal pressure. Its main risk is error in identifying beneficiaries. Inclusion error gives benefits to ineligible people, but exclusion error is especially serious because an eligible poor household may lose essential support such as subsidised foodgrain. Targeting therefore needs correct identification, updated records, grievance redressal and strong delivery.

Targeted support tries to direct public spending toward specific eligible groups, so it can make subsidies more focused and pro-poor. Its weakness is the possibility of wrong identification. Inclusion error means an ineligible person receives the benefit, while exclusion error means an eligible person is left out. Exclusion is especially serious from a welfare point of view because poor households may lose essential support. Therefore, targeting works well only when identification, records, delivery and grievance redressal are strong.

A subsidy is government assistance that makes an essential good, service or activity effectively cheaper for consumers, producers or both. The study note stresses that it is not always a cash payment. It may appear as lower prices, cheaper inputs, tax concessions, interest subvention, direct benefit support or state-supported supply. The common feature is that the government bears a cost or gives up revenue to support affordability, welfare, production or another policy objective.

The study note gives a simple CET-level distinction. In the marketplace model, the platform connects buyers and sellers and supports listing, search, payment, order management and delivery, while independent sellers supply the goods. In the inventory model, the company or platform owns the goods and sells them directly to customers. The distinction is not based on whether payment is online or cash-on-delivery, nor on whether the transaction is retail, service booking or business-to-business.