“Since actuarial premium rates are high for more risky areas and having high variability in yield, the sum insured also gets reduced proportionately due to capping system and therefore, farmers in these districts do not get the full benefit of crop insurance”, the official explained.
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“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”, Modi tweeted hours after the Cabinet cleared the proposal.
Going beyond the conventional methods of compensation and crop cover, the new insurance scheme provides for compensation for even loss of seed plants and post-harvest damage.
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“This scheme not just retains the best features of past policies but also rectifies all previous shortcomings…”
The heavily subsidised scheme will come into effect in April, a major crop-sowing season. The Modified National Agricultural Insurance Scheme (MNAIS) is being implemented since 2013-14 rabi season in Andhra Pradesh, Rajasthan, Uttar Pradesh, Uttarakhand, Goa and Kerala. “It is a historic day”, Modi tweeted after the scheme was announced by the ministers of agriculture, home and parliamentary affairs.
The use of technology will be encouraged to a great extent.
Under the new scheme, farmers’ premium has been kept at a maximum of 2 per cent for foodgrains and oilseeds and up to 5 per cent for horticulture / cotton crops.
There is no upper limit on Government subsidy. Smart phones will be used to capture and upload data of crop cutting to reduce the delays in claim payment to farmers.
“So far, a government will only provide relief, but now the scheme will compensate for the losses”, Agriculture Minister Radhamohan Singh said.
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Urban development and poverty alleviation minister M Venkaiah Naidu told NDTV, “Because of area-based assessments – in which the results of crop cutting experiments over a small area are used to pay claims for a larger area – farm-level assessment is not done at all”.
