New insurance scheme to cover 50% of farmers, says Jaitley

The Pradhan Mantri Fasal Bima Yojana (PMFBY) will reduce the distress of farmers in the country as it will grant insurance cover to 50 per cent of them , Union Finance Minister Arun Jaitley said.

“We have had crop insurance schemes in the past also. There has been a considerable debate about the effectiveness of those schemes. To be fair, they met with a modest level of success,” Mr. Jaitley said at an event at NABARD.

“But that can't be the level of our ambition, particularly because agriculture is one sector which is absolutely critical to the Indian economy,” he said.

If India were to develop and get rid of poverty, the agriculture sector needs to grow at a faster pace. “The last two crop seasons have been adversely affected on account of inadequate monsoons. We need to put a veil of some security around the farmers,” Mr. Jaitley said.

Anjali Chib Duggal, Secretary, Financial Services, said under the new scheme, the government was planning to impose penalties for delays in settlement of farmers’claims.

Under the scheme, farmers will pay a lower premium for more coverage, while compensation will be higher in the event of any crop failure or damage. The scheme will be rolled out on a “mission mode” from April to cover kharif or summer crop from this year itself, according to the government.

Ms. Duggal said that the scheme was drafted after much consultation with all stakeholders. She felt that the scheme should percolate to the ground level and aim at bringing a large number of farmers under insurance.

The country, which has seen two successive droughts, is hoping for a better monsoon this year. Mr. Jaitley said that the systems would be on test, if there was another drought.

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Printable version | Jan 25, 2021 1:50:16 AM |

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