PMFBY: Farmers Quitting Scheme But Premium Collection Rises -Subodh Varma

-Newsclick.in

Latest data shows that insurance companies have pocketed over Rs. 10,000 crore surplus in two years.

The number of farmers enrolled in the Modi government’s flagship crop insurance scheme (Pradhan Mantri Fasal Bima Yojana or PMFBY) dipped further to 343 lakh in kharif (summer) crop season of 2018-19 year, according to latest information revealed at the annual Kharif Conference organised by the Agriculture Ministry in Delhi on April 25-26. When the scheme was started in 2016, enrolment in the first kharif season was 404 lakh, which declined to 349 lakh in 2017.

Strangely, gross premium collected by insurance companies has continued to grow from Rs. 16,015 crore in 2016 to Rs. 20,522 crore in 2018. This is because per farmer premium rate is increasing, and so is the state and central government’s contribution to premium. In other words, insurance companies continue to reap enormous profits despite lower coverage. That’s the business model this scheme has foisted upon the farmers.

Less farmers covered means a larger number of farmers are now completely at the mercy of the weather gods. Small wonder then, that in many states, farmers demand compensation for crop losses from the state governments, who in turn press the Centre for drought relief packages.

The data put out at the conference by PMFBY CEO Dr. Ashish Bhutani also reveals that in the past two years (2016-17 and 2017-18) of the scheme’s operation, insurance companies have pocketed a surplus of Rs. 10,219 crore. They collected gross premium worth Rs.47, 447 crore, but had to admit farmers’ claims worth Rs. 37,228 crore in the four crop seasons (one each of kharif and rabi, in each year).

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Newsclick.in, 1 May, 2019, https://www.newsclick.in/PMFBY-Farmers-Quitting-Premium-Narendra-Modi

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