18th March, 2003
Ministry of Agriculture  


RS. 4000 CRORE CROP INSURANCE PAID TO FARMERS

GOVERNMENT FOR DOING MORE


The Union Government will soon announce revised norms for the National Agricultural Insurance Scheme (NAIS) to further increase the coverage of farmers under the scheme, which has reached 106 lakh in 2001-02. Under NAIS launched during the Rabi season of 1999-2000 an amount of Rs.661.23 crore has been paid to 77.26 lakh farmers during the first five crop seasons. Since the launch of the scheme 269 lakh farmers have insured a total crop value of Rs.17,867.12 crore against total Insurance charges of Rs.531.71 crore. The total claims by the farmers amounted to Rs.1823.02 crore. The cropped area covered has been 331.45 lakh hectares.

The National Agriculture Insurance Scheme has proved to be a significant improvement over its predecessor, the Comprehensive Crop Insurance Scheme (CCIS), which was implemented from 1985 to 1999. During the fifteen years of implementation of CCIS, 761 lakh farmers have insured a total sum of Rs.24,922 crore against insurance charges of Rs.402.83 crore. Against total claims made by the farmers of Rs.2305.05 crore, an amount of Rs.2297.22 crore has been paid to the farmers. The total crop area covered under CCIS was 1275 lakh hectares. Under the CCIS, drought related claims accounted for about 75% of the total claims followed by floods with about 20%.

NAIS has become more popular with the farmers than CCIS following enlargement of scope of coverage by extending it to non-loanee farmers, annual commercial and horticultural crops. It also provided for greater coverage of risk up to the value of threshold yield. Farmers also have the choice for the coverage of more risk in terms of sum insured by paying higher premium rates. Under CCIS and its successor NAIS, Rs.3958.45 Crore has been paid to farmers till the end of Rabi season of 2001-02.

Under NAIS food crops and oil seeds and annual commercial and horticultural crops like cotton, sugar cane, potato, onion, chillies, turmeric, ginger, tapioca, annual banana and pineapple are covered for all natural non preventable risks leading to yield losses. Loanee farmers are covered on compulsory basis while the scheme is optional for non-loanee farmers. Small and marginal farmers are eligible for 50% subsidy on premium. The premium rates range from 1.5% to 3.5% for food crops and oil seeds and on commercial basis for commercial and horticultural crops. General Insurance Company is presently the implementing agency for NAIS. Central and State governments share the premium subsidy equally.

The central government has earmarked Rs.1500 crore for crop insurance during the 10th Five Year Plan period. The expenditure in this regard during 9th Five Year Plan was Rs.1031.49 crore against the initial allocation of Rs.730 crore. NAIS, a voluntary scheme, is presently being implemented by 23 states and union territories. Non-implementing states/union territories include Delhi, Haryana, Chandigarh, Punjab, Rajasthan, Mizoram, Manipur, Nagaland, Arunachal Pradesh, Dadra & Nagar Haveli, Daman & Diu and Lakswadeep. The reasons for non-implementation include non-availability of requisite past yield data, sharing of financial liabilities and the states demanding the right to distribute the insurance payments among the affected farmers.

Based on the views expressed by some states and recommendations of the Conference of State Agriculture Ministers and Standing Committee of Union Ministers and Chief Ministers on Food Management and Agricultural Exports, the Union Agricultural Ministry is reviewing NAIS for expanding its scope. The review covers rationalisation of premium rates, limiting the sum insured, state wise maintenance of corpus fund, assessment of yield rates through Small Area Crop Estimation Method, coverage of perennial crops etc.

During the two years of implementation of NAIS, 27.13 lakh farmers have been paid insurance in Gujarat while it has been 17.54 lakh farmers in Maharashtra, 11.46 lakh in Madhya Pradesh, 4.55 lakh in Andhra Pradesh, 4.11 lakh in Karnataka, 4.04 lakh in Orissa, 4.02 lakh in Chhatisgarh, 2.82 lakh in Uttar Pradesh, 0.73 lakh in West Bengal, 0.72 lakh in Tamil Nadu, 0.30 lakh in Bihar, 0.15 lakh in Kerala, 866 farmers in Himachal Pradesh, 696 in Goa, 590 in Assam and 499 in Meghalaya.

 
[previous release] [next release]