Agriculture in India The history of agriculture in India dates back to the South Asian Stone Age, neolothic. India List of countries by GDP sector composition, ranks second worldwide in farm outputs. As per 2018, agriculture employed more than 50% of the Indian wo ...

is highly susceptible to risks like droughts and floods. It is necessary to protect the farmers from natural calamities and ensure their credit eligibility for the next season. For this purpose, the

Government of India The Government of India (ISO: ; often abbreviated as GoI), known as the Union Government or Central Government but often simply as the Centre, is the national government of the Republic of India, a federal democracy located in South Asia, c ...

introduced many agricultural schemes throughout the country.

Current insurance schemes

Pradhan Mantri Fasal Bima Yojana

The

Pradhan Mantri Fasal Bima Yojana The Pradhan Mantri fasal bima yojana (PMFBY) launched on 18 February 2016 by Prime Minister Narendra Modi is an insurance service for farmers for their yields. It was formulated in line with One Nation–One Scheme theme by replacing earlier t ...

(Prime Minister's Crop Insurance Scheme) was launched by

Prime Minister of India The prime minister of India (IAST: ) is the head of government of the Republic of India. Executive authority is vested in the prime minister and their chosen Council of Ministers, despite the president of India being the nominal head of the ...

Narendra Modi Narendra Damodardas Modi (; born 17 September 1950) is an Indian politician serving as the 14th and current Prime Minister of India since 2014. Modi was the Chief Minister of Gujarat from 2001 to 2014 and is the Member of Parliament from ...

on 13 February 2016.

Livestock Insurance Scheme

Livestock Insurance Scheme in India provided "provide protection mechanism to the farmers and cattle rearers against any eventual loss of their animals due to death and to demonstrate the benefit of the insurance of livestock to the people and popularize it with the ultimate goal of attaining qualitative improvement in livestock and their products."10 important government schemes for agriculture sector
India today, 2019-08-30.

Other agriculture schemes launched by Modi regime

Agriculture initiatives schemes launched by the Modi regime are: *

2020 Indian agriculture acts The Indian agriculture acts of 2020, often termed the Farm Bills, were three acts initiated by the Parliament of India in September 2020. The Lok Sabha approved the bills on 17 September 2020 and the Rajya Sabha on 20 September 2020. The Presid ...

Atal Bhujal Yojana Atal Bhujal Yojana (or, Atal Jal, Atal Groundwater Scheme or Atal Water) is a groundwater management scheme launched by Prime Minister Narendra Modi on the 95th birth anniversary of former Prime Minister Atal Bihari Vajpayee, on 25 December 2 ...

E-NAM National Agriculture Market or eNAM (where ''e'' is to be construed as electronic or digital) is an online trading platform for agricultural commodities in India. The market facilitates farmers, traders and buyers with online trading in commodit ...

for online agrimarketing *

Gramin Bhandaran Yojana Gramin Bhandaran Yojana, or Rural Godown Scheme, is an Indian government initiative to offer subsidies to individuals or organizations which build or repair rural godowns. Introduction The network of rural storage will increase the holding capaci ...

for local storage * Micro Irrigation Fund (MIF) * National Mission For Sustainable Agriculture (NMSA) * National Scheme on Fisheries Training and Extension * National Scheme on Welfare of Fishermen * Pradhan Mantri Kisan Samman Nidhi (PMKSN) for minimum support scheme * Pradhan Mantri Krishi Sinchai Yojana (PMKSY) for irrigation * Paramparagat Krishi Vikas Yojana (PKVY) for organic farming * Pradhan Mantri Fasal Bima Yojana (PMFBY) for crop insurance *

Farmer Income Protection Scheme (PM AASHA) The Prime Minister's Farmer Income Protection Scheme (), also known as PM AASHA () is an umbrella scheme of the Government of India announced in September 2018 to ensure a price policies such as a minimum support price are fulfilled. It includes t ...

Previous schemes

Farm Income Insurance Scheme

The Central Government formulated the Farm Income Insurance Scheme (FIIS) during 2003-04. The two critical components of a farmer's income are yield and price. FIIS targeted these two components through a single insurance policy so that the insured farmer could get a guaranteed income. The scheme provided income protection to the farmers by insuring production and market risks. The insured farmers were ensured minimum guaranteed income (that is, average yield multiplied by the minimum support price). If the actual income was less than the guaranteed income, the insured would be compensated to the extent of the shortfall by the

Agriculture Insurance Company of India Agriculture Insurance Company of India Limited (AIC) is a central public sector undertaking under the ownership of Ministry of Finance, Government of India. It offers yield-based and weather-based crop insurance programs in almost 500 distric ...

. Initially, the scheme would cover only wheat and rice and would be compulsory for farmers availing crop loans. NAIS (explained in the section below) would be withdrawn for the crops covered under FIIS, but would continue to be applicable for other crops. The FIIS was withdrawn in 2004.

National Agriculture Insurance Scheme

The Government of India experimented with a comprehensive crop insurance scheme which failed. The Government then introduced in 1999-2000, a new scheme titled “National Agricultural Insurance Scheme” (NAIS) or “Rashtriya Krishi Bima Yojana” (RKBY).NationalAgriculturalInsuranceScheme (NAIS) / Rashtriya Krishi Bima Yojana (RKBY)
NAIS envisages coverage of all food crops (cereals and pulses), oilseeds, horticultural and commercial crops. It covers all farmers, both loanees and non-loanees, under the scheme. The

premium Premium may refer to: Marketing * Premium (marketing), a promotional item that can be received for a small fee when redeeming proofs of purchase that come with or on retail products * Premium segment, high-price brands or services in marketing, ...

rates vary from 1.5 percent to 3.5 percent of sum assured for food crops. In the case of horticultural and commercial crops, actuarial rates are charged. Small and marginal farmers are entitled to a subsidy of 50 percent of the premium charged- the subsidy is shared equally between the Government of India and the States. The subsidy is to be phased out over a period of 5 years. NAIS operates on the basis of # Area approach # On individual basis- for localized calamities such as hailstorms, landslides, cyclones and floods. Under the scheme, each state is required to reach the level Gram Panchayat as the unit of insurance in a maximum period of 3 years. Agriculture Insurance Corporation of India is implementing the scheme. This scheme is replaced by Pradhan Mantri Fasal Bima Yojana.

Economic interactions

The

minimum support price The minimum support price (MSP) is an advisory price signal that is part of a larger set of agricultural policies in parts of India. This informal "support" price (as opposed to procurement or issue price) is recommended by the government and ai ...

subsidy influences insurance pricing. The

insurable interest Insurable interest exists when an insured person derives a financial or other kind of benefit from the continuous existence, without repairment or damage, of the insured object (or in the case of a person, their continued survival). A person has an ...

is calculated as normal for an unsubsidised

crop A crop is a plant that can be grown and harvested extensively for profit or subsistence. When the plants of the same kind are cultivated at one place on a large scale, it is called a crop. Most crops are cultivated in agriculture or hydroponic ...

, but for subsidised crops the MSP is used. This distorts the function of the insurance market. Although this program is intended to increase per farmer income a goal advocated by

Bhimrao Ramji Ambedkar Bhimrao Ramji Ambedkar (14 April 1891 – 6 December 1956) was an Indian jurist, economist, social reformer and political leader who headed the committee drafting the Constitution of India from the Constituent Assembly debates, served a ...

setting an artificial price also impairs decision making in

crop insurance Crop insurance is purchased by agricultural producers, and subsidized by the federal government, to protect against either the loss of their crops due to natural disasters, such as hail, drought, and floods, or the loss of revenue due to declines ...

also a major policy focus for Ambedkar, the subject of many of his public speeches, and some of his academic work.

References

External links

National Agricultural Insurance Scheme (NAIS) guidelines

Agricultural Insurance in India Problems and Prospects

Crop Insurance - An Indian Experience

Pradhan Mantri Fasal Bima Yojana

gktoday
{{Insurance in India

India India, officially the Republic of India (Hindi: ), is a country in South Asia. It is the seventh-largest country by area, the second-most populous country, and the most populous democracy in the world. Bounded by the Indian Ocean on the so ...

Insurance in India

Insurance Insurance is a means of protection from financial loss in which, in exchange for a fee, a party agrees to compensate another party in the event of a certain loss, damage, or injury. It is a form of risk management, primarily used to hedge ...