As Kerala braces for another year of severe drought, a Centre-State stand-off is set to deny crop insurance benefit to thousands of farmers of the state in the next fiscal. A disagreement over the mode of fund transaction to prepare the annual agricultural statistics will also affect the state’s agricultural plan process. The Centre’s crop insurance scheme, implemented through the National Agriculture Insurance Company, is based on the average yield calculated by the Establishment of an Agency for Reporting Agricultural Statistics  (EARAS). The EARAS is a fully-funded Central scheme implemented through the State Economics and Statistics Department (ESD). In January this year, the Centre decided to abandon the treasury route for fund transactions and asked states to open bank accounts. But Kerala did not comply with the direction resulting in an ultimatum from the Centre that laid out two choices. The first is to opt for bank transactions. Second, if the state government does not want this, the scheme can be converted to a Centrally-sponsored scheme in which the state will have to bear 40 per cent of the project cost. When contacted, ESD director general V Ramachandran told Express the state is yet to take a decision on the matter. “It is a policy decision to be taken by the government. We’ve written to Planning Secretary for necessary directions,” he said. The department has also sent a letter to the Centre requesting the old mode of fund transaction be continued. But the DG said that was unlikely to happen. If the government wants to convert the  scheme into a Centrally-sponsored one, the ensuing Budget should have an allocation for this. But it is learnt the Finance Department is unaware of the issue. The inordinate delay in taking a decision will also have a bearing on the state’s agricultural planning and the LDF government’s prestigious schemes to promote farming. It will also affect the salary of over 850 employees working in the EARAS. Source - http://www.newindianexpress.com