Here we shall discuss about Pradhan Mantri Fasal Bima Yojana or the Crop Insurance Scheme, which aims to insure the crops both from pest attack, disease and natural disasters like flood and drought and decrease the burden of premium from farmer's shoulder.
Answer to UPSC GS Paper-III (Mains) 2016 question:
Given the vulnerability of Indian agriculture to vagaries of nature,discuss the need for crop insurance and bring out the salient features of the Pradhan Mantri Fasal Bima Yojna (PMFBY).
1) Ministry : Ministry of Agriculture and Farmer's welfare
2) Launched on: 13-Jan-2016
Operational Guidelines announced at: Sehore in Madhya Pradesh on 20-Feb-2016
3) Crop insurance scheme
4) Scheme will come into effect from the Kharif season of 2016
5) This scheme will help in decreasing the burden of premiums on farmers who take loans for their cultivation and will also safeguard them against the inclement weather.
Need for Crop Insurance:
The agriculture in India has been prone to severe damage caused by :
The damage caused to the crop is irreparable so we need an alternative method via which farmer's hard-earned money could be recovered as he would have taken loan from banks to prepare the field and sow the crop.
If the crop is insured before the season begins, the farmer will be assured that even if any damage is caused to his crop due to any calamity or disease, the money invested on cultivating the crop could be recovered and the loss suffered could be minimized.
The main reason for farmer's increasing suicidal tendency has been mounting loan amounts due to crop failure. As the insurance scheme will reduce the burden of premium from farmer's shoulder and minimize the monetary losses caused by disease, pest attacks, natural disaster etc., the farmer would be able to pay loan's installment on time.This will not only benefit the farmers but also the banks whose loan amounts could be recovered easily.
Salient Features of PMFBY:
1) Uniform premium :
The premium rates to be paid by farmers are very low and balance premium will be paid by the Government to provide full insured amount to the farmers against crop loss in any natural calamities
2) NAIS and MNAIS have been discontinued from Kharif 2016, but the ongoing Weather Based Crop Insurance Scheme (WBCIS) and Coconut Palm Insurance Scheme would continue to operate while premium to be paid under WBCIS has been brought on a par with PMFBY.
3) There is no upper limit on Government subsidy. Even if balance premium is 90%, it will be borne by the Government.
Earlier, there was a provision of capping the premium rate which resulted in low claims being paid to farmers. This capping has now been removed and farmers will get claim against full sum insured without any reduction.
4) Crop insurance coverage is set to rise from 45 million hectares or 23% of the area under cultivation at present to 50% of the crop area by 2018-19.
5) Losses incurred by farmers at any stage of the farming activity — from the sowing to the post-harvest season — would be covered.
Earlier, only post-harvest losses can be offset by the insurance facility under the two existing schemes.
6) Also, even those farmers who haven’t taken bank loans will be eligible for insurance cover under PMFBY.
7) The use of technology will be encouraged to a great extent.
8) In line with "One Nation – One Scheme theme."
9) It has also been decided to make the settlement process of the insurance claim, fast and easy so that the farmers do not face any trouble regarding the crop insurance plan.
10) This scheme will be implemented in every state of India, in association with respective State Governments.
11) The insurance plan will be handled under a single insurance company, Agriculture Insurance Company of India (AIC).
Objectives of the Crop Insurance scheme :
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Answer to UPSC GS Paper-III (Mains) 2016 question:
Given the vulnerability of Indian agriculture to vagaries of nature,discuss the need for crop insurance and bring out the salient features of the Pradhan Mantri Fasal Bima Yojna (PMFBY).
Pradhan Mantri Fasal Bima Yojana (PMFBY) or Crop Insurance scheme
1) Ministry : Ministry of Agriculture and Farmer's welfare
2) Launched on: 13-Jan-2016
Operational Guidelines announced at: Sehore in Madhya Pradesh on 20-Feb-2016
3) Crop insurance scheme
4) Scheme will come into effect from the Kharif season of 2016
5) This scheme will help in decreasing the burden of premiums on farmers who take loans for their cultivation and will also safeguard them against the inclement weather.
Need for Crop Insurance:
The agriculture in India has been prone to severe damage caused by :
- unprecedented floods during monsoon season due to heavy rainfall confined in a limited area,
- crop failure caused due to drought caused by poor monsoon (rainfall),
- attacks by pests, rodents or a disease.
The damage caused to the crop is irreparable so we need an alternative method via which farmer's hard-earned money could be recovered as he would have taken loan from banks to prepare the field and sow the crop.
If the crop is insured before the season begins, the farmer will be assured that even if any damage is caused to his crop due to any calamity or disease, the money invested on cultivating the crop could be recovered and the loss suffered could be minimized.
The main reason for farmer's increasing suicidal tendency has been mounting loan amounts due to crop failure. As the insurance scheme will reduce the burden of premium from farmer's shoulder and minimize the monetary losses caused by disease, pest attacks, natural disaster etc., the farmer would be able to pay loan's installment on time.This will not only benefit the farmers but also the banks whose loan amounts could be recovered easily.
Salient Features of PMFBY:
1) Uniform premium :
- 2% to be paid by farmers for Kharif crops,
- 1.5% for Rabi crops.
- 5% for annual commercial and horticultural crops
- National Agricultural Insurance Scheme (NAIS) and
- Modified National Agricultural Insurance Scheme (MNAIS)
The premium rates to be paid by farmers are very low and balance premium will be paid by the Government to provide full insured amount to the farmers against crop loss in any natural calamities
2) NAIS and MNAIS have been discontinued from Kharif 2016, but the ongoing Weather Based Crop Insurance Scheme (WBCIS) and Coconut Palm Insurance Scheme would continue to operate while premium to be paid under WBCIS has been brought on a par with PMFBY.
3) There is no upper limit on Government subsidy. Even if balance premium is 90%, it will be borne by the Government.
Earlier, there was a provision of capping the premium rate which resulted in low claims being paid to farmers. This capping has now been removed and farmers will get claim against full sum insured without any reduction.
4) Crop insurance coverage is set to rise from 45 million hectares or 23% of the area under cultivation at present to 50% of the crop area by 2018-19.
5) Losses incurred by farmers at any stage of the farming activity — from the sowing to the post-harvest season — would be covered.
Earlier, only post-harvest losses can be offset by the insurance facility under the two existing schemes.
6) Also, even those farmers who haven’t taken bank loans will be eligible for insurance cover under PMFBY.
7) The use of technology will be encouraged to a great extent.
- Smart phones will be used to capture and upload data of crop cutting to reduce the delays in claim payment to farmers.
- Remote sensing will be used to reduce the number of crop cutting experiments.
8) In line with "One Nation – One Scheme theme."
9) It has also been decided to make the settlement process of the insurance claim, fast and easy so that the farmers do not face any trouble regarding the crop insurance plan.
10) This scheme will be implemented in every state of India, in association with respective State Governments.
11) The insurance plan will be handled under a single insurance company, Agriculture Insurance Company of India (AIC).
Objectives of the Crop Insurance scheme :
- To provide insurance coverage and financial support to the farmers in the event of failure of any of the notified crop as a result of natural calamities, pests & diseases.
- To stabilize the income of farmers to ensure their continuous process in farming.
- To encourage farmers to adopt innovative and modern agricultural practices.
- To ensure flow of credit to the agriculture sector.
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