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Pradhan Mantri Fasal Bima Yojana (PMFBY)

  Jul 13, 2020

Pradhan Mantri Fasal Bima Yojana (PMFBY)

What is PMFBY?

Pradhan Mantri Fasal Bima Yojana is the flagship scheme of the government for agricultural insurance in India in line with the ONE NATION- ONE SCHEME theme.

What is covered under PMFBY?

The Pradhan Mantri Fasal Bima Yojana will cover the following cases under crop insurance:

Objectives of PM FBY

Pradhan Mantri Fasal Bima Yojana (PMFBY) aims at supporting sustainable production in agriculture sector by way of

  1. Providing financial support to farmers suffering crop loss/damage arising out of unforeseen events.
  2. Stabilizing the income of farmers to ensure their continuance in farming.
  3. Encouraging farmers to adopt innovative and modern agricultural practices.
  4. Ensuring flow of credit to the agriculture sector which will contribute to food security,
  5. crop diversification and enhancing growth and competitiveness of agriculture sector besides protecting farmers from production risks.

Problems in implementing PM FBY

  1. Non-receipt of premium subsidy by insurance companies from the State government is highlighted as reason for delay in settling claims.
  2. The major problem of the PMFBY scheme is crop cutting experiments (CCEs).
  1. Farmers in most States are unhappy with the fact that the governments have made PMFBY compulsory for availing crop loans.
  2. Clusters are awarded to an insurance company on the basis of bids do to driving down the premium. On the contrary, cartelization across clusters leads to high premiums.
  3. Local officials often collude with farmers to inform them about the plots chosen for CCEs 50-60 days in advance. The farmers then deliberately avoid taking care of the field, leading to a poor crop. such fudging of data is leads to higher claims driving premiums up.
  4. No use proposed remote sensing technology, smartphones or drones to expedite the crop loss estimation.
  5. Delays in payment of claims. Thus effectively farmers still remain in financial distress, defeating very purpose of scheme.