The government this week is expected to announce a crop insurance scheme where farmers would have to pay a maximum premium of 2.5% of the sum insured for the food crops, while the remaining cost would be borne by state and central governments in a bid to support farmers in case of crop failure.
Official sources said that the new crop insurance policy proposes immediate payment of 25% of sum insured amount for crop damage to farmers and use of latest technologies such as drone, smartphone, mobile app and satellite imaginary to assess crop damages in the shortest possible time for dealing with delay in settlement of compensation.
Currently, farmers pay as high as 15% premium on the sum assured under the two crop insurance schemes Modified National Agricultural Insurance Scheme (MNAIS) and Weather-Based Crop Insurance Scheme (WBCIS).
State has owned Agriculture Insurance Company of India, which is a key player providing crop insurance, along with private sector companies have been taken into consultation prior to formulation of the proposed New Crop Insurance Scheme (NCIS).
The Cabinet, which is expected to take up NCIS on Wednesday, 13th January, would consider the agriculture ministry proposal of fixing maximum premium up to 1.5% for wheat, 2.5% for paddy, 2% for oilseeds and 2-2.5% for other crops.
As per the agriculture ministry proposal, maximum premium for horticultural crops (fruits, vegetables and plantation) is proposed at 5% under the NCIS, while in case of existing MNAIS and WBCIS premium paid for crops such as fruits and vegetables goes up to as high as 40%. According to an agriculture ministry official, the subsidy paid by the Centre is expected to go up to around Rs 7,000 crore from the current level of Rs 3,000 crore.
A major chunk of farmers who took crop insurance were in Rajasthan, Bihar, Uttar Pradesh, Maharashtra, Karnataka and Andhra Pradesh.
The dismal performance is attributed to the low insurance pay-outs, level of premier that the farmers found unaffordable and hassles in settlement of claims. Only a tiny segment of the farmer community availed of the facility last fiscal in Jharkhand, Tamil Nadu, Telangana, Himachal Pradesh and Kerala.
Chair professor for agriculture at ICRIER, Ashok Gulati said “Insurance based on input-cost mechanism is not going to help. The policy should be to protect the income of farmers from agriculture risks. Besides land record digitisation, satellite images should be used for quicker assessment of crop damage and settlement of dues to farmers.”
Source: http://www.financialexpress.com/
