Agriculture has a significant contribution to the Indian Economy.So for securing the investment in this sector as well as for the development of the agriculture sector too, the government has been operating Pradhan Mantri Fasal Bima Yojana. As per the statistics of 2014, the total contribution of the agricultural sector in India’s GDP is 17.9%. Similarly, nearly 58% of the total population of the rural area is dependent on the agriculture. Indian Government has been launching various programs to make the agriculture, subsistence-focused to production-focused with the modernization and commercialization of the agriculture. Indian Government has also launched various programs like Gahan Krishi Vikash Kaaryakram (1960-61), Gahan Krishi Kshetra Kaaryakram(1964-65), Harit Kranti(1966-67), Sukha Pravan Kshetra(1973) , etc. before this. As a result of this, since few decades, farmers are being enthusiastic towards this sector. Indian Medias have been frequently repeating the success of Pradhan Mantri Fasal Bima Yojana in making the investment of farmers secure.
Geographically, being 22 times greater than Nepal, the insurance market of India is also very bigger.
Annually earning 1 billion 1 hundred 44million American dollar of premium earning Indian Insurance Market has the annual growth rate of 17% . Occupying the 1.5 % of total premium of global premium, the Indian insurance market is supposed to cover the 2 % of the portion in near future as per the Indian Insurance intellectuals.
The Indian Insurance Market had already started before the genesis of Insurance business concept in Nepal. Now 53 insurance companies are in operation in India. Among them 24 are life insurance companies, 29 are general insurance companies. Among 29 general insurance companies, 5 companies are giving the service of health, personal accident and travel insurance merely. Similarly, being focused towards the agriculture and crops, Agriculture Insurance Company Limited and being focused towards loan insurance, Indian Export Guarantee Corporation has been giving specialized services.
Pradhan Mantri Fasal Bima Yojana
Still when the Nepalese Insurance sector is creeping its path, the Indian Insurance companies have launched various programs. With government’s assistance , Indian insurance Companies have operated various farmer-focused programs like Rastriya Krishi Bima Yojana , Pradhan Mantri Fasal Bima Yojana .On 13 January ,2016 , Indian Prime Minister Narendra Modi publicly launched Pradhan Mantri Fasal Bima Yojana with the slogan of “Minimum premium , more insurance for the prosperity of farmers “.
Under this insurance, the relief in the case of contingent losses and comfort from the burden of insurance premium is supposed to be effected. Due to the instant and easy claim process, the said policy is believed to be easy for the farmers. Under the direction of Central government, the said policy is being compulsorily operated in all state.
The main objective of this plan is to attract the peasants towards guarantying the contingent loss in the agriculture due to the pest and insects with the increasing natural risk as well as attracting the farmers towards the modernized agricultural practice .Covering the 100% risk of the farmers investment as well as making the easy loan flow is the main attraction of this plan. It is being operated under the ministry of Agriculture and Farmers prosperity of Indian Government.
As per the last statistical report, in the insurance plan 3.66 crore farmers have participated. While in 2013, 2.09 crore of farmers had taken the crop insurance, in this insurance plan, 1 lakh 41 thousand 3 hundred 39 crore Indian currency premium has been collected. In 2013, only 49 thousand 4 hundred 54 crore rupees premium was collected. Within a period of 3 and half years, the crop insurance premium collection has levelled up by 1 hundred 86 percent.
Up to 2015, out of total farmers, only 23 percent were within the margin of insurance. While, within coming 3 years, Indian Government aims to take this figure to 50%.
Main Attraction of Plans
As per the Indian Government, by the payment of 1.5% of the premium, farmers can ensure their winter season crops and by payment of 2% premium, farmers can ensure their rainy season crops under Pradhan Mantri Fasal Bima Yojana. Similarly, Indian Government further adds that, by payment of 5% premium, for cash as well as garden crops, the farmers can avail the insurance facility. The government pays the remaining due. As per the nature of insurance, after the payment of own side premium by the farmer, the remaining premium is paid the government. So it is also known as a limitless subsidy. For the Pradhan Mantri Fasal Bima Yojana , operating under the Indian agriculture Insurance Company (AIC), Indian Government has even allocated a sum of 8 thousand 8 hundred crores of Indian currency. Pradhan Mantri Fasal Bima Yojana has been taken as an insurance policy to substitute the Raastriya Krishi Bima yojana and Samsodhit Raastriya Bima Yojana.
Objectives of the plan
Indian Prime minister Narendra Modi has been mentioning that the main objective of this insurance plan is to provide insurance security from the calamities, loss from the pest, guarantee the earning of farmers, and attract the farmers towards creative and modernized farming as well as to guarantee the loan flow in the sector of agriculture.
Condition to carry the risk
All farmers doing the agriculture in the area notified by the Indian Government can participate in this plan. Under the food crop, the pulses, oilseed, garden crops are only within its limit. In the insured area, if any loss occurs due to famine, or weather cause or due to the insects, pests, calamities, the storm then the claim can be made. However, the loss due to atomic attack, theft, chaos, riots, war or due to the attack of domestic or wild animals are not payable for the claim.
However, it is a bitter truth that the country which has been supporting the entire world by the export of 1.5% of total production has been witnessing the death of hundreds of farmers annually. Even though, the Indian government has been calling the agriculture as the nation’s backbone. Indian analysts say that after the democracy of 1947, the focus of India towards the industrialization has created negligence to the agriculture sector. However, Pradhan Mantri Fasal Bima Yojana does have various merits too. Due to the low premium rate, low earning farmers don’t need to face the financial burden. With this regulation of this plan, it has been supposed that the internal production is going to increase and the numbers of the suicidal case, due to the famine and flood, will too be reduced. Up to 2015, out of total farmers, only 23 percent were within the margin of insurance. While, within coming 3 years, Indian Government aims to take this figure to 50%. In Nepal too, the government has publicized the agriculture insurance plan in 2069BS. But, due to the lack of access of the targeted group in the program, complex claim acceptance procedure, as well as due to the lack of proper public awareness, the insurance plan in this sector has not become effective in the context of Nepal. Intellectuals claim that there is still lack of positive attitude towards the insurance as well as the insurance plans focused towards the low earning groups are not effective in the context of Nepal.
Last financial year, a premium of 81 lakhs 4 hundred 20 rupees 11 paisa was collected from crop insurance while. For the crop insurance, 60 lakhs 75 thousand 3 hundred 15 rupees 8 paisa subsidy was spent by the government, as shown by the statistics of Insurance board. For the policy amount of 16 crores 98 lakhs 24 thousand 2 hundred 52 rupees and 24 paisa, 88 lakh 42 thousand 6 rupees 40 paisa claim was paid.
For the current financial year, under the agriculture insurance program, the government has allocated 3 times more budget, 35 crores 50 lakhs rupees, than the previous financial year.In the first financial year of 2070/71 of operation of agriculture insurance program, the government had allocated 13 crore rupees. But in that year, due to the lack of advertisement of the insurance, only 1 crore 70 lakhs rupees was spent. There in second year, financial year 2071/72 government allocated 6 crore rupees only. But in that year, the agriculture insurance program grew rapidly. The allocated sum being less, the government had to further make the addition of 5 crore rupees. Similarly, for the financial year 2072/73, the government allocated 12 crore rupees. In that year also, the allocated sum being less, the government had to make the addition of 6 crore rupees. By imitating the policy of India, Nepal Government has brought Pradhanmantri Krishi aadhuniikikaran Pariyojana. However, regarding the effectiveness and achievement of this policy, the previous year’s exercise and results to create a lot of space to doubt.