Telangana and Jharkhand have opted out of the crop insurance scheme, saying the premium is too high. Premium increased 2-3% after the scheme was made voluntary for farmers. More than 6 million farmers from these two states had enrolled for the scheme.
West Bengal, Bihar, Punjab and Andhra Pradesh have already exited, and officials said Rajasthan and Maharashtra were debating whether to continue with the scheme.
Under the crop insurance scheme, farmers contribute up to 2% of the total premium while the rest is shared equally between the state and the centre.
“Since number of farmer will go down, the premium rates will increase and governments will have to fill the gap,” the official said.
Under the new insurance scheme, the provision that caps the central subsidy in the premium rates to 30% for unirrigated areas and 25% for irrigated areas has also discouraged states.
“Centre has limited its share in premium in few agro-climatic regions, the balance will have to be paid by states and farmers, which doesn’t seem viable for many states. So, states are weighing options,” the official said.
However, experts view it as a farm politics between BJP and non-BJP rules states.
“States which have opted out of this schemes are non-BJP ruled except Bihar where BJP is in coalition. Rajasthan and Maharashtra, showing intent to exit, are also non-BJP ruled,” an insurance company executive said.
Source – https://economictimes.indiatimes.com