Out of the annual allocation of ₹1,400 crore under the Centre’s flagship agriculture insurance initiative – the Pradhan Mantri Fasal Bima Yojana (PMFBY), merely ₹8 crore or just over half a percent was spent last year in the northeastern States of India. Shockingly, four states – Arunachal Pradesh, Nagaland, Manipur, and Mizoram don’t even fall under the coverage of this scheme. As a result, countless maize farmers in Mizoram have been impacted by losses from the fall armyworm pest without any insurance fallback.
Challenges Faced by Northeastern States
States in the Northeast grapple with numerous obstacles such as the disinterest of insurance companies and the deficiency of State budgetary resources to contribute their share of the premium. Insurance companies are reluctant to accommodate these States in their portfolio as the administrative costs are excessively high due to the absence of proper land records and lack of historic yield data at the gram panchayat and block level.
Non-conduciveness of Crop-Cutting Experiments
The complexity of conducting Crop-Cutting Experiments (CCEs) poses another challenge. CCEs are executed to garner an equitable, precise, and authentic approximation of crop yields, crucial for several horticulture crops. The limited coverage also contributes to the disinterest of insurance companies towards the northeastern states. Furthermore, there is a low count of loanee farmers in the Northeast, barring Assam, which hinders the widespread adoption of PMFBY.
Inadequate Forecasting Infrastructure
Another hindrance for the weather-based insurance scheme is the inadequate forecasting infrastructure. To ensure insurance companies cater to the farmers in the northeastern states, effective marketing of farm produce is essential. State governments must either collaborate with the PMFBY scheme or develop their unique set of schemes benefitting the farmers.
| State | PMFBY Allocation (in ₹ crore) | Actual Spend (in ₹ crore) |
|---|---|---|
| Northeastern States | 1400 | 8 |
Pradhan Mantri Fasal Bima Yojana (PMFBY)
Launched on 18th February 2016, the Pradhan Mantri Fasal Bima Yojana (PMFBY) is administered by the Ministry of Agriculture and Farmers Welfare. The scheme provides expansive insurance cover against crop failure, thus helping stabilize the income of the farmers. It covers all food and oilseed crops as well as annual commercial/horticultural crops, for which past yield data is available and for which sufficient Crop Cutting Experiments (CCEs) are being conducted under the General Crop Estimation Survey (GCES).
For all Kharif crops, farmers pay a nominal premium of 2%, 1.5% for all rabi crops, and 5% for annual commercial and horticultural crops. There is no upper limit on subsidy by the government, which bears the expenditure even if the remaining premium is 90%. The scheme is obligatory for loanee farmers availing Crop Loan /KCC account for notified crops, and voluntary for others.
