India - Crop Insurance Should Cover All Farmers

21.03.2014 347 views

Unseasonal rains and hailstorms have savaged the crops of farmers, especially in central and western India. While Madhya Pradesh, Maharashtra and Punjab are the worst affected, Rajasthan, Uttarakhand, Gujarat, Haryana and Andhra Pradesh are also severely affected. Many of these crops chana, lentils and wheat in MP, mustard in Rajasthan or onions and grapes in Maharashtra were due for harvesting. Compounding their plight is the onset of the Lok Sabha poll. The model code of conduct prohibits any special relief package on the ground that it could influence voters.

Even if the Election Commission allows it the state and district administrations have no time due to their preoccupation with the elections. Issues like assessing the extent of crop damage and compensation to be paid to individual farmers are unlikely to receive top priority.

Effectively, real and substantial support is very improbable over the next few months and the plight of farmers in the states cannot but be alarming.

The crisis underlines the need for a proper crop insurance scheme that triggers automatic payments for losses from natural disasters. Such a mechanism should be independent of elections or government attitude. Agriculture is inherently risk-prone and susceptible to the vagaries of nature. The present National Agricultural Insurance Scheme is woefully inadequate in meeting natural challenges. The process is bureaucratic and by the time the farmer gets his claim, it is often too little too late.

We need to shift to a system where insurance is mandatory for receiving compensation against crop loss. Strangely, at present it is compulsory only for farmers who have taken loans. It also operates on an “area approach”. A farmer isn’t eligible for indemnity unless the taluka or block area in which the farm falls is declared calamity-affected.

Legitimately, claims should be assessed on the basis of individual farmers against the “area approach”. The arrangement should be a matter between the farmer and the insurance company, subject to regulation. The state can chip in to subsidise premiums if needed.

Source - http://www.newindianexpress.com/

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