Government allocation for Pradhan Mantri Fasal Bima Yojana (PMFBY)

In News –Recently, the Government of India allocated Rs. 16000 crore for Pradhan Mantri Fasal Bima Yojana (PMFBY) for 2021-22.

• This is a budgetary increase of around Rs 305 crore against the previous fiscal year 2020-21.

About Pradhan Mantri Fasal Bima Yojana (PMFBY):

• The flagship crop insurance scheme was launched on 13th January 2016, in line with the One Nation-One Scheme theme.
• PMFBY is globally the largest crop insurance scheme in terms of farmer participation and 3rd largest in terms of premium.
• The scheme extends coverage for the entire cropping cycle from pre-sowing to post-harvest including coverage for losses arising out of prevented sowing and mid-season adversities.
  •  Over 5.5 crore farmer applications are received on a year-on-year basis.
• It replaced the existing National Agricultural Insurance Scheme (NAIS) and its modified version (MNAIS).
• Key Features –
  • There is no upper limit on Government subsidy.
  • The premium rates to be paid by farmers are very low, and the Government pays a balance premium to provide full insured amounts to the farmers.
  • The prescribed premium is 2% to be paid by farmers for all Kharif crops and 1.5% for all rabi crops.
    • In the case of annual commercial and horticultural crops, the premium is 5%.
  • Premium cost over and above the farmer share is equally subsidised by States and the Center.
    • However, the Centre’s share is 90% of the premium subsidy for the Northeastern States to promote the uptake in the region.
  • Earlier, there was a provision of capping the premium rate, which resulted in low claims being paid to farmers, so it was removed and farmers will get a claim against full sum insured without any reduction.
    • Use of Technology-

• Integration of land records with the PMFBY portal.
• Crop Insurance mobile app for easy enrolment of farmers.
• Farmers can report crop loss within 72 hours of the occurrence of any event through the App, Common Service Centres (CSCs) or the nearest agriculture officer.
  • Claim benefit is then provided electronically into the bank accounts of the eligible farmer.
• Usage of satellite imagery, remote-sensing technology, drones, artificial intelligence (AI) and machine learning (ML) to assess crop losses.

Objectives & significance-

• To provide insurance coverage and financial support to the farmers in the event of failure of any of the notified crops as a result of natural calamities, pests and diseases.
  • It covers yield losses, losses arising out of prevented sowing due to adverse weather conditions, post-harvest losses and losses due to certain localized problems like hailstorms, landslides and flooding.
  • To stabilise the income of farmers to ensure their continuance in farming.
  • To encourage farmers to adopt innovative and modern agricultural practices.
  • To ensure the flow of credit to the agriculture sector.

Achievements

• Claims worth Rs. 90,000 crore have so far been disbursed to farmers since the launch of the scheme.
• The Aadhaar seeding has helped in speedy claim settlement directly into the farmer accounts.
• Even during the Covid-19 lockdown period, nearly 70 lakh farmers benefitted and claims worth Rs. 8,741.30 crore were transferred.

Source: PIB