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New insurance plan for 4 farm products on anvil

NEW DELHI: Not satisfied with the results of the National Agriculture Insurance Scheme (NAIS), the Group of Ministers (GoM) will finalise a new crop insurance scheme (CIS) for tea, rubber, spices and tobacco growers.

The GoM headed by Agriculture Minister Sharad Pawar will take a call on what shape the scheme will take. The scheme proposes to cover around 30 lakh growers in 22.26 lakh hectares.

The coverage is up to 10 hectares except in the case of tea and cardamom where land holdings between 10 and 50 hectares will be covered. According to the proposal to be put before the GoM, the scheme will provide insurance against the investment in input cost and will cover risks associated with crop loss due to weather, pest attack and named peril factors. It includes provision of 50 per cent subsidy on the insurance premium for land holdings up to 10 hectares (Rs. 723.63 crore) and 25 per cent subsidy between 10 and 50 hectares (Rs. 5.17 crore).

The total subsidy on annual insurance premium would be Rs. 728.80 crore for five years, to be paid by the Union Government out of the interest earnings of the Price Stabilisation Fund Trust and balance through budgetary support (Rs. 499.55 crore).

The Cabinet Committee on Economic Affairs had referred to the scheme to the GoM to look into the issue of subsidy sharing by the Central and State governments keeping in view the pattern in other such schemes.

NAIS had not made much dent due to high premium rates, dependence on government subsidisation for premium as well as claim payout and inordinate delay in settling of claims.

The GoM would deliberate on the crop insurance scheme to be 100 per cent fund by the Central Government since plantation crops proposed under the scheme are administered under Central legislations.

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