In July 2023, Karnataka launched India’s first state-led Direct Benefit Transfer (DBT) scheme for food grains under the Anna Bhagya Scheme (ABS), transitioning from in-kind distribution to an unconditional cash transfer model. This report critically assesses the implications of providing ₹34 per kg/person/month directly to eligible beneficiaries, addressing questions of adequacy, targeting efficiency, and policy replicability. Drawing on household cereal consumption data from NSSO 2022–23 and insights into state and central food security schemes, the study evaluates whether DBT can equitably and effectively replace traditional grain distribution mechanisms. Through a detailed fiscal and operational analysis, the report provides a timely exploration of evolving welfare paradigms in India’s food security landscape.