Rebooting Economy 53: Why crop insurance is losing traction in India
Several studies throw up structural, logistical and financial challenges to the growth of crop insurance in India, jeopardised by apparent profiteering by insurance companies
Prasanna Mohanty | December 23, 2020 | Updated 23:17 IST
The biggest challenge for farmers continues to remain the unusual way crop insurance works in India
Crop insurance is one of the key elements to stabilise farmers by compensating for crop losses arising out of drought, flood and other causes. In 2016, India overhauled crop insurance to expand its coverage of farmers and farm areas. Initially, it did expand the coverage but since then it has seen a downward slide, one of the key reasons for this being visible profiteering by insurance companies.
MSP isn’t a solution to farmers’ woes
Covering all 23 crops under MSP is a gigantic task, requiring huge budget allocations - THE HINDU
Covering all 23 crops under MSP is a gigantic task, requiring huge budget allocations - THE HINDU×
A better bet is the Price Deficiency Payment Scheme, as it is easy to execute and can cover all crops and farmers
The agitating farmers are mainly demanding guarantee of minimum support price (MSP), although the new farm laws are not related to MSP in any way and the government has time and gain said that procurement under MSP will continue.
Crop loss at initial stage considered for compensation
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Government and insurance company officials inspecting submerged paddy crop at Kuzhimaththur hamlet in Thiruvaiyaru taluk.
Farmers of Kuzhimathur hamlet at Thiruvaiyaru taluk in Thanjavur district will soon be the first to get compensation under the Pradhan Mantri Fasal Bima Yojana scheme for crop loss suffered during initial days of cultivation.
Over 300 acres of paddy crop, just transplanted, at this revenue village submerged in water due to a sudden and heavy downpour this month.
The water remained on the field for more than three to four days and efforts to drain the excess water went in vain.The transplanted crop perished, pushing the farmers into gloom.
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Most Indian farmers have tiny farms that yield meagre incomes. They face a multiplicity of risks, which jeopardises even these low incomes. These twin pressures are particularly acute in eastern India, manifest in the two states that were the focus of our study, Bihar and Odisha. With nearly 80% of the population in Bihar and 70% in Odisha still engaged in agriculture, increasing farmers’ incomes in these two states is critical.
Agriculture policies in India have largely focused on three policy tools to increase (and stabilise) farmers’ incomes: decreasing input costs through input subsidies, improving crop yields through better seeds and farming practices, and increasing output prices while stabilising incomes through the Minimum Support Price (MSP) and procurement. More recently, policy has begun to pay attention to getting farmers a greater share of the marketed surplus, which has led to renewed concerns about the state of agriculture markets, the focus
CHANDIGARH: Union minister for civil aviation and housing and urban affairs Hardeep Singh Puri has made it clear that the Centre was always ready to discuss all genuine demands of farmers across the table, but it was not the time to be stubborn.
Puri said bringing tractors to Delhi to block roads was not the way to protest. He was addressing a “virtual kisan sammelan” from Delhi on Wednesday, which was attended by Punjab BJP leaders and party workers.
“In a democracy every person has the right to voice his concerns and protest, but there is a way to protest,” Puri said. The Union minister said if people other than farmers were joining protests just for the sake of politics, their issues were non-relevant. He asked all Punjab BJP leaders and workers to reach out to the farmers and convey that the central government was ready to address all their genuine demands across the table in face-to-face discussions. He added that the main demands of farmers were regarding continuing