The Indian government is set to expand its central bank digital currency (CBDC)-based food subsidy program to Chandigarh, Dadra and Nagar Haveli, and Daman and Diu by June. This follows a pilot implementation in Gujarat and Puducherry. Under this scheme, beneficiaries will receive their Public Distribution System (PDS) entitlements as digital tokens instead of collecting physical grain at ration shops. Officials indicate that this initiative could save around 4-5% in subsidy costs while enhancing the transparency and efficiency of food distribution. The CBDC is designed to function like a digital coupon, ensuring that funds are used specifically for purchasing eligible foodgrains such as wheat and rice. Beneficiaries can access the digital tokens through smartphones or receive a redemption code via feature phones. The existing physical distribution system will continue to operate alongside this digital model, providing flexibility for beneficiaries. Additionally, this new approach aims to streamline payments to fair price shop dealers, making the settlement process faster and more transparent. Overall, this initiative represents a significant reform in subsidy administration while maintaining existing procurement protections under the National Food Security Act.