Fundamental flaws in crop insurance scheme's design makes it ineffective -Devinder Sharma
The government did not visualize there were problems in the way it was designed, the methodology itself was faulty
Pradhan Mantri Fasal Bima Yojana (PMFBY), the flagship programme launched with much fanfare in 2016, has run into rough weather. With both the area covered and the number of enrolled farmers declining, the country’s premium crop insurance scheme is certainly in need of an overhaul.
While Parliament’s committee on estimates, chaired by senior Bharatiya Janata Party leader Murli Manohar Joshi, has in its latest report called for re-formulation of the agricultural insurance scheme, seeking transparency in its working and asking for more financial allocations to attract increasing participation from farmers, there are fundamental flaws in the design of the scheme that renders it rather ineffective.
At a time when farm gate prices had remained subdued over the past few years, and when fluctuating climatic conditions—drought, floods, as well as freak weather patterns, including hailstorm and strong winds—had flattened the standing crop at many places, PMFBY could have come as the much-needed safety net. But a badly designed crop insurance programme has failed to come to the rescue of the beleaguered farming community. Take the case of Haryana, where standing crops on 1.85 lakh acres across 15 districts were damaged in September due to heavy rains and resulting floods. Interestingly, while the revenue estimates of the crop damage are ready, the crop losses suffered do not tally with the crops that were insured by the private crop insurance companies. This is because the insurance companies just collected the premium amounts from the banks without actually doing a ground assessment to know what crops were under cultivation.
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