The Centre will launch a Central Bank Digital Currency (CBDC)-based Direct Benefit Transfer (DBT) system for food subsidies under the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) in Chandigarh and Dadra & Nagar Haveli on August 14, 2026, making the two Union Territories the first in the country to fully digitise food subsidy delivery through Digital Rupee tokens. 

The launch will be attended by Union Minister for Consumer Affairs, Food and Public Distribution Pralhad Joshi, Punjab Governor and Chandigarh Administrator Gulab Chand Kataria, Union Agriculture Minister Shivraj Singh Chouhan, and Minister of State for Consumer Affairs, Food and Public Distribution Nimuben Jayantibhai Bambhaniya, among other dignitaries.

  Under the new mechanism, eligible PMGKAY beneficiaries will receive their food subsidy directly into CBDC wallets instead of through conventional bank transfers, the food ministry said in a statement.

  The digital tokens can then be used to purchase foodgrains from empanelled fair price shops via a real-time, traceable digital payment system.

  The ministry said the move builds on earlier pilot projects run in Puducherry and Gujarat, and represents complete digital adoption across all eligible beneficiaries in the two Union Territories – a first for the country’s public distribution system.

  The government has pitched the initiative as a way to plug leakages and reduce diversion of subsidies, while cutting down on cash handling in the welfare delivery chain.

  The ministry also said the shift is expected to enable faster, more secure benefit transfers and encourage wider adoption of wallet-based digital payments among beneficiaries.

  The rollout is being positioned as a pilot for the rest of the country, with the government hoping to use lessons from Chandigarh and Dadra & Nagar Haveli to eventually scale the model to other states and Union Territories.

  It is also expected to feed into the Centre’s broader push on Digital Public Infrastructure, as authorities look to test how CBDCs can be integrated into large-scale welfare programmes.