Agroinsurance

NEWS

India - Centre reduces insurance premium on cotton crop to 6%

29.07.2014 242 views

The Union government has reduced insurance premium on cotton crop from 17.19 per cent to 6 per cent, giving relief to farmers in cotton-growing states like Gujarat and Maharashtra.

Agriculture minister Babu Bokhiria along with Members of Parliament (MPs) from Gujarat had met Prime Minister Narendra Modi and Union Agriculture minister Radhamohan Singh and requested them to reduce premium on cotton crop insurance after fears of weak monsoon gripped farmers.

Gujarat Chief Minister Anandiben Patel had also written a letter to the Union government in this regard.

"Old premium was high and farmers were opposed to this rate due to weak monsoon this year. After meeting officials from Centre, the concerned ministry had decided to reduce crop insurance premium from 17.19 per cent to 6 per cent," said Raj Kumar, principal secretary, department of agriculture and co-operation, Gujarat government.

The new premium is applicable to all cotton-growing farmers across the country with immediate effect. So far premium on cotton insurance was 17.19 per cent and states were giving subsidy as per their convenience. Gujarat was giving 6 percent subsidy to farmers while the premium rate was 11.19 per cent.

Gujarat agriculture minister Govind Patel said, "Cotton is the main kharif crop in Gujarat and cotton-growing farmers were worried about their crop due to deficient rainfall in the state. The state agriculture ministry and other MPs from the state met Prime Minister and Union Agriculture minister and requested them to reduce premium on cotton crop insurance."

There have been some changes in insurance pattern on claiming.

Regarding claim on insurance pattern, Raj Kumar said, "So far, insurance companies had to pay full claim as premium rate was commercial. But now the company will have to pay 150 per cent of premium as claim. If amount is more than this, then the state and central governments will contribute equally."

As on July 21, kharif cotton sowing in Gujarat has reached 1.77 million hectares as against 2.56 million hectares in corresponding period last year. It is down by almost 35 per cent in comparison to last three year's average of 2.71 million hectares in the same corresponding period.

Source - http://www.business-standard.com/

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