The newly-launched Pradhan Mantri Fasal Bima Yojana (PMFBY) will bring about 50 per cent of India’s farmers in the crop insurance net and help reduce the prevailing distress in the agriculture sector, according to Finance Minister Arun Jaitley.

PMFBY is distinct from all earlier schemes in the sense that it not only takes the number of insured farmers to a higher level (from 20 per cent earlier to the estimated 50 per cent now), but it will also provide more insurance coverage to farmers, assuring them complete safety, Jaitley said at a seminar on the PMFBY organised by the Department of Financial Services at the the Nabard (National Bank for Agriculture and Rural Development) headquarters here.

In this new scheme, farmers will pay less for more coverage and the compensation will be much more in the event of any crop failure or destruction.

“Since the last two years, we have been facing deficit monsoons. While we hope for better monsoons this year, with this new scheme in place, we will be better equipped to safeguard the farming community,” Jaitley said.

He observed that the revamped insurance schemes that have been launched have the potential to reduce distress in the farm sector and would be rolled out in a “mission mode” from April 1 to cover kharif crops.

Though the country had crop insurance schemes in the past, they were partially successful as they were mainly linked to crop loans, Jaitley pointed out. Uttarakhand became the first state to adopt PMFBY as insurance companies bid for premiums lower than the stipulated 2 per cent.

Penalty for settlement delays The government is also looking at imposing penalties for delay in settlement of farmers’ claims under the new crop insurance plan, said Financial Services Secretary Anjuly Chib Duggal.

In the Union Budget, the Centre has made an allocation of ₹5,500 crore for the crop insurance programme under which farmers will have to pay 1.5 per cent of the premium for the sum insured for rabi crops and 2 per cent of the premium for kharif crops.

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