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Last Updated : Mar 14, 2018 03:24 PM IST | Source:

PM Modi's crop insurance beneficiaries decline by 20% in FY18

The government had set a target of covering 50 percent of gross cropped area under crop insurance scheme by FY19.

Moneycontrol News @moneycontrolcom

The number of farmers covered under the Prime Minister Narendra Modi's flagship crop insurance scheme has declined by nearly 20 percent, according to figures released by the government on Tuesday.

A Mint report stated that only 4.79 crore farmers were covered under the prime minister’s crop insurance scheme in FY18 compared to 5.75 crore farmers the year before, the government informed the Lok Sabha.

The crop insurance coverage fell among farmers irrespective of whether they had taken a credit. Among loanee farmers, the coverage fell to 350 lakh in 2017-18 from 4.40 crore the year before, whereas the coverage of non-loanee farmers fell marginally to 1.30 crore from 1.40 crore during this period.

Earlier, studies released by Delhi-based think tank Centre for Science and Environment in July 2017 stated that the implementation of the Prime Minister’s crop insurance scheme is has been suffering due problems such as delays in assessment of crop loss and claim settlement, high actuarial premiums charged by insurance companies.

 The gross premium collected by insurance companies in FY18 increased by 9.8 percent to Rs 24,352 crore from Rs 22,180 crore the year before, despite a decline in the land holdings over the past year, the government told the Rajya Sabha on March 9.

 The government had set a target of covering 50 percent of gross cropped area under crop insurance scheme by FY19. However, top officials feel that it may be a tough task to reach that target.

“It is unlikely that insurance coverage in terms of gross cropped area will improve in 2017-18 over the 30 percent coverage achieved in 2016-17,” a top official with an insurance company told the paper on condition of anonymity.

The official added farmers are suffering due to delayed payments as less than 40 percent of the premium due has been received so far from state governments.  The Centre is yet to calculate the total claims filed by farmers in the current year ending March (2017-18).

A growth rate of agriculture credit has also slowed over the past few years owing to poor implementation.

“The growth rate in agriculture credit fell sharply in the past few years... and due to rising indebtedness and delays in loan repayment by farmers expecting to benefit from loan waivers, it could be that banks are issuing less fresh loans. This could be bringing down the number of loanee accounts and therefore, the (mandatory) crop insurance enrolment numbers,” Himanshu, associate professor of economics at Jawaharlal Nehru University, Delhi told the paper.
First Published on Mar 14, 2018 03:24 pm
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