New crop insurance scheme to roll out in 2016-17

412603-406371-agriculturalThe government will launch the much-talked about new crop insurance scheme, which aims to keep a lower premium for farmers and faster settlement of claims, in 2016-17.

We have identified discrepancies in the existing scheme of Modified National Agricultural Insurance Scheme (MNAIS) and come out with a new crop insurance scheme.

Once it is approved by the Cabinet, the scheme will be implemented from 2016-17,Agriculture Minister Radha Mohan Singh told reporters here.Banner-280120Under the proposed crop insurance scheme, the premium to be charged from farmers will be kept lower and focus will be on early settlement of claims. New technologies, including drones, will be used to assess crop damage faster, he said.

On January 6, the sticky issue of premium was discussed at length at a meeting with ministerial colleagues by Prime Minister Narendra Modi. Apparently, the concerns have been addressed and the proposal will be taken before the Cabinet at the earliest.

After the PM’s meeting, Singh had said, We will address all the issues and take the proposal before the Cabinet at the earliest so that the scheme can be implemented from the forthcoming kharif season from June.

In the Cabinet note, the Agriculture Ministry has proposed an average premium of up to 2.5% for foodgrain and oilseeds crops and 5% for horticulture crops. However, some sections within the Cabinet want a lower premium.

It has estimated the expenditure at Rs 8,000 crore if 50% of the total crop area of 194 million hectare is insured.

The proposal on the new crop insurance scheme, moved by the Agriculture Ministry, was once discussed at a Cabinet meeting last year, but the decision was deferred in the wake of differences over the premium rate.

In the existing MNAIS, the average premium rate for farmers has been kept at 5.5% though the premium rate for high risky crops is as high as 40%.

Last year, only 27% of the crop area was insured, which cost Rs 3,150 crore to the national exchequer.

Curated from New crop insurance scheme to roll out in 2016-17.

 

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