New Delhi : The central government on Wednesday announced a new crop insurance policy 'Pradhan Mantri Fasal Bima Yojana' for farmers across the country, saying the "path-breaking scheme" will boost the farming sector.
Announcing the new insurance scheme for the farmers, union Home Minister Rajnath Singh said "it would minimise the atmosphere of uncertainty" for farmers.
"The new crop insurance scheme will not only act as 'Suraksha Kawach' (security shield) against the vagaries of nature but also safeguard farmers' interests," he said at a press conference.
Earlier, the new crop insurance policy was approved by the union cabinet in a meeting chaired by Prime Minister Narendra Modi.
Talking about previous crop insurance policies for farmers, the home minister said they failed because of certain reasons and points of their failure have been taken into account before coming up with the new policy, He hoped it would be "accepted" by farmers of the country.
"This would be based on the concept of minimum premium and maximum cover (for the crops)," said
Singh was accompanied by union Agriculture Minister Radha Mohan Singh and union Minister for Urban Development, Housing and Urban Poverty Alleviation and Parliamentary Affairs M. Venkaiah Naidu at the press conference.
Singh termed it "a historical decision" of the Bharatiya Janata Party-led National Democratic Alliance government, saying it would help increase purchasing power of the farmers and this, in turn, would shield the country's economy from any bad effects of global financial slowdown.
Speaking on the occasion, the agriculture minister said the new crop insurance scheme will provide "safety" to crops and it will be implemented from the upcoming Kharif season that generally begins in April.
"The new insurance policy will cover seeds, plants and post harvest damage," Radha Mohan said, adding that it will ensure speedy disposal of cases.
The minister said the damage claim would also be simplified as farmers would be allowed to send in pictures of the damaged crop through their mobile smartphones to the agencies concerned.
The use of technology will be encouraged to a great extent. Smartphones 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.
Naidu said the farmers never have "level playing field" as they get affected with all sorts of natural calamities.
"This (the new scheme) will take care of them," he said.
Naidu also said it was due to Prime Minister Narendra Modi's constant effort that the government has come up such a "path breaking" scheme.
"From the day one he has been thinking of poor and vulnerable sections of the society," he added.
Under the 'Pradhan Mantri Fasal Bima Yojana', 25 percent insurance funds of the total compensation for the damaged crop will be disbursed to the farmers' bank account directly.
The minister said that the burden of insurance amount would be funded by the central as well as the state government.
There will be a uniform premium of only 2 percent to be paid by farmers for all Kharif crops and 1.5 percent for all Rabi crops. In case of annual commercial and horticultural crops, the premium to be paid by farmers will be 5 percent only.
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 percent, it will be borne by the government.
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.
The new crop insurance scheme is in line with 'One Nation - One Scheme' theme. It incorporates the best features of all previous schemes and at the same time, all previous shortcomings and weaknesses have been removed, Rajnath Singh added.
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
Though going back to old practice of three components (A-Cash, B-Kind, provision of inputs and C- A consumption component in gross bank credit) may not be practical, human involvement in appraisal and supervision of credit cannot be substituted by technology while providing bank credit to farm sector.
M G Warrier, Mumbai