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LATEST NEWS UPDATES | Is new crop insurance panacea for all ills? -K Venkateshwarlu

Is new crop insurance panacea for all ills? -K Venkateshwarlu

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published Published on Jan 22, 2016   modified Modified on Jan 22, 2016
-The Hindu

Crop insurance has always been a knotty issue with the two previous ones, National Agricultural Insurance Scheme (NIAS) of 1999 and the Modified NAIS of 2010 failing to address the concerns.

Hyderabad: Agriculture scientists, NGOs and farmer leaders have picked holes in the recently launched Pradhan Mantri Fasal Bhima Yojana (PMFBY) touted as the much-awaited ‘suraksha kavach’ (shield) and panacea for all crop insurance related ills.

Crop insurance has always been a knotty issue with the two previous ones, National Agricultural Insurance Scheme (NAIS) of 1999 and the Modified NAIS of 2010 failing to address the concerns of the farmers that range from high premium, linkage to crop loans, cap on claims to abysmal coverage.

PMFBY promises to address some of these concerns by reducing the premium drastically to 1.5 per cent for rabi food grains and two per cent for kharif ones and up to five per cent for horticulture and cotton crops, removal of cap both on government subsidy on payment of premium as well as on claim ensuring farmers get the entire sum insured and almost doubling the coverage from 23 per cent now to 50 per cent. In terms of crop area too it plans to extend it to 50 per cent of the 194.40million hectares from the present level of 27 per cent.

Ambiguity

Though it is recognised as an improvement over the previous schemes, it still seems to fall short of farmers’ expectations. GV Ramanjameyulu, former agriculture scientist of Indian Council of Agricultural Research and Executive Director of Centre for Sustainable Agriculture, an NGO, had this to say: “There is ambiguity over the insurance unit whether it will be village as has been consistently demanded by farmers or block or something else. Another glaring omission is the fate of tenant farmers whose number is substantial. There is no clarity on whether they come under the ambit of the new insurance scheme or not”.

Dr. Ramanjaneyulu felt crop insurance continued to be weather-centric and said he would have liked the Central and State governments to focus their attention on reducing the risk factors in other areas. Across the country, farmers were switching over to crops like cotton, falling prey to aggressive campaigns of industry without taking into account the high input costs and suitability of the soil. When the crop failed they were resorting to extreme steps.

P. Chengal Reddy, president of the Federation of Farmers Associations, too was not sure if the new scheme would work, given the past track record with coverage not exceeding seven per cent at any time. He termed the proposal to extend it to 50 per cent as highly ambitious.

On the other hand, New Delhi based NGO, Centre for Science and Environment has described the PMFBY as a step in the right direction but required further improvements. India needs an “effective, inclusive and universal” crop insurance scheme to act as a safety net for farmers as frequency of extreme weather events due to climate change, is likely to increase in the future.

Another sticking point Mr. Chengal Reddy pointed out was the equal sharing of the premium subsidy by the Centre and the State governments. He said this model would not work given the measly budget allocations made to agriculture by the State governments. It would have been better if the Central government had taken the entire responsibility as the estimated expenditure of Rs. 9,500 crore was not a big amount. Low premium and use of mobile and satellite technology for accurate assessment of losses were commendable.

Though Pradhan Mantri Fasal Bhima Yojana is seen as an improvement over the previous schemes, it still seems to fall short of expectations

The Hindu, 21 January, 2016, http://www.thehindu.com/news/cities/Hyderabad/is-new-crop-insurance-panacea-for-all-ills/article8132334.ece


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