Implementing its poll promise on the day of the start of the harvest season, the NDA Government on Wednesday announced an ambitious Crop Insurance Scheme meant to provide to farmers cover for loss of crop due to natural calamities. Farmers will have to pay only 2 per cent of the premium fixed by insurance companies for kharif food grains/ oilseeds crops and 1.5 per cent for rabi food grains/oilseeds crop under the Pradhan Mantri Fasal Bima Yojana (PMFBY).
The remaining sum of premium would be borne by the Centre and State Governments equally, entailing outgo of `8,800 crore annually by the Central Government for coverage of 50 per cent of the crop area of 194.40 million hectares. The scheme, cleared by the Cabinet, will be rolled out from the coming kharif season beginning June.
“There will be a uniform premium of only 2 per cent to be paid by farmers for all Kharif crops and 1.5 per cent for all Rabi crops. In case of annual commercial and horticultural crop, the premium to be paid by farmers will be only 5 per cent. The premium rates to be paid by farmers are very low and balance premium will be paid by the Government to provide full insured amount to the farmers against crop loss on account of natural calamities. There is no upper limit on Government subsidy. Even if balance premium is 90 per cent, it will be borne by the Government,” said the Government in a statement.
Soon after the Cabinet decision, Prime Minister Narendra Modi expressed confidence that the new Crop Insurance Scheme will bring about a major transformation in the lives of farmers, saying it expands the definition of disaster and addresses whatever was lacking in the existing programmes.
“Farmer brothers and sisters, at a time when you are celebrating festivals like lohri, Pongal and Bihu, the Government has given you a gift in the form of Prime Minister’s Crop Insurance Scheme,” he tweeted after the Cabinet cleared the proposal. “This is a historic day. I am confident that this scheme, which is inspired by the consideration of farmers’ benefit, will bring about a major transformation to the lives of farmers,” Modi added.
In a series of tweets, the Prime Minister said the scheme includes successful aspects of the existing schemes and “effectively addresses” whatever was lacking in those schemes.
“The scheme has the lowest premium, it entails easy usage of technology like mobile phone, quick assessment of damage and disbursement within a timeframe,” he said.
The definition of disaster has been expanded to include aspects like flooding of crop and damage after harvest, Modi said, adding “special attention” has been paid to several other aspects.
“It is easy to subscribe to the scheme and easy to benefit. So, do join it,” he told the farming community which is in distress and many of whom have been committing suicide.
After coming to power, the Modi Government had announced that it would bring a new crop insurance scheme by replacing the existing ones to ensure higher coverage of crop area at low premium and better claim settlement facilities.
“Earlier, there was a provision of capping the premium rate which resulted in low claims being paid to farmers. This capping was done to limit Government outgo on the premium subsidy. This capping has now been removed and farmers will get claim against full sum insured without any reduction,” said the Government statement.
Expressing confidence that farmers will adopt this new scheme, Home Minister Rajnath Singh said it will help them tide over financial uncertainties. “This new crop insurance scheme will have the lowest premium for farmers in the history of Independent India. The new scheme has taken care of the anomalies in the existing two schemes and added new provisions,” he said, addressing media about Modi Government’s “path breaking scheme for farmers”.
The Home Minister was addressing media with his colleagues Venkaiah Naidu and Agriculture Minister Radha Mohan Singh. Stating that the Prime Minister has himself suggested reducing premium burden on farmers, Parliamentary Affairs Minister Naidu said the farming community will be “very happy” with this scheme.
He observed that farmers get adversely affected by natural calamities in the absence of level-playing field for them. “This path-breaking measure will take care of farmers by providing them necessary assurance through this insurance cover.”
The Agriculture Minister said the scheme will also cover post-harvest losses and ‘prevented sowing’.
“There is no upper limit on the Government subsidy. Even if balance premium is 90 per cent, it will be borne by the Government,” an official statement said.
To assess crop damage for early settlement of the claims, the Government will adopt modern technology to a great extent. “Smart phones will be used to capture and upload data of crop cutting to reduce the delays in claim payment to farmers. Remote sensing will be used to reduce the number of crop cutting experiments,” the Government said.