From Ration Cards to Digital Rupees: India Pilots CBDC in Gujarat

Key Highlights

Efficient & Transparent: Eliminates repeated biometric checks and provides real-time transaction tracking; FPS dealers paid instantly.
Pilot Coverage: Started in Gujarat districts, with plans to expand to Chandigarh, Puducherry, Dadra & Nagar Haveli, and Daman & Diu.

The Government of India has started a pilot program in Gujarat that uses Central Bank Digital Currency (CBDC) for distributing food. The aim is to bring the Public Distribution System (PDS) up to date, making it more transparent, efficient, and accountable.

The pilot was officially launched in Ahmedabad by Union Home Minister Amit Shah, with Union Minister Prahlad Joshi, Gujarat Chief Minister Bhupendra Patel, and Minister of State Limuben Jayantibhai Bambhaniya present.

A digital step for food security

India’s PDS is the biggest food distribution system in the world, reaching more than 80 crore people. Bringing in CBDC is a significant step toward digital modernization and making it easier for beneficiaries to access their entitlements.

Speaking at the event, Prahlad Joshi said, “The introduction of Central Bank Digital Currency in the Public Distribution System marks a significant milestone towards ensuring transparency, efficiency, and beneficiary empowerment in India’s food security architecture.”

He emphasized the new slogan: “Har Dana, Har Rupiya, Har Adhikar,” to convey that the initiative is about ensuring people know their entitlements, access them easily, and hold the system accountable.

How CBDC-based digital food coupons work

Under the pilot, beneficiaries will receive digital coupons credited directly from the Reserve Bank of India in the form of programmable digital rupees (e₹). These digital coupons can be used at Fair Price Shops (FPS) by scanning QR codes or entering voucher codes.

The system solves problems like biometric failures and e-POS glitches, while keeping a real-time digital record of every transaction. This makes the process faster, more secure, and transparent for both the beneficiaries and the shopkeepers.

“The CBDC pilot represents an important extension of the Digital India vision into PDS. Nearly half of the world’s digital transactions now take place in India. CBDC will further strengthen the government’s vision of Minimum Government, Maximum Governance, ensuring beneficiaries receive their entitled food grains with greater transparency and awareness of rights.”

Amit Shah (Union Home Minister)

Pilot coverage and expansion plans

The initiative has launched in Ahmedabad, Anand, Valsad, and Surat districts of Gujarat. Plans are already underway to expand the pilot to the Union Territories of Chandigarh, Puducherry, and Dadra & Nagar Haveli and Daman & Diu.

Under the CBDC system, beneficiaries will get digital wallets with programmable digital rupees. This lets them buy foodgrains at Fair Price Shops easily and quickly. They won’t need to keep going through biometric checks, purchases will be quicker, and every transaction will have a clear digital record.

Fair Price Shop owners will also get their margins right away, making the whole process easier for everyone.

Building on India’s digital transformation

The CBDC pilot is the next step in modernizing India’s food security system. Earlier reforms already set the stage:

Ration cards have been completely digitized.
Portability across the country is available under One Nation One Ration Card (ONORC).
e-POS machines have been rolled out for Aadhaar-based authentication.
The Rightful Targeting Dashboard helps check data and monitor operations.
Supply chains have been made smoother through Ann Chakra.
Grievances are addressed faster via Ann Sahayata.

Now, with CBDC, the PDS gets a programmable digital payment layer, taking digital reform a level further and making welfare delivery more efficient.

Why Gujarat and why food

Gujarat was picked because it has the digital infrastructure and administrative readiness to run this pilot smoothly. Food was chosen since it’s the biggest welfare program in India, affecting millions directly.

The pilot makes sure that people receive their foodgrains quickly, safely, and in a transparent way, while also creating a clear digital record that can be monitored easily.

Launch event and key attendees

The launch brought together top leaders from both the central and state governments, showing close cooperation:

Harsh Sanghvi, Deputy Chief Minister of Gujarat
Ramanbhai Bhikhabhai Solanki, Minister for Food and Civil Supplies, Gujarat
Poonamchand Chhanabhai Baranda, Minister of State for Food and Civil Supplies, Gujarat
Meeraben Patel, Mayor of Gandhinagar

Officials from the Government of India, the Government of Gujarat, and the Reserve Bank of India were also present to oversee the pilot.

A transformative step in welfare delivery

This CBDC pilot is more than just introducing new technology. It is a practical test to see whether digital currency can make welfare delivery faster, more transparent, and more accountable for everyone.

If it succeeds, it could change the way food grains reach people across the country, make last-mile delivery better, and set a new standard for running welfare programs with digital tools.

2026-02-16 16:14