1. Agriculture World

Why Farmers are Unhappy with Pradhan Mantri Fasal Bima Yojana?

Chander Mohan
Chander Mohan

In the wake of Elections in Maharashtra, the report on the performance of the Prime Minister Fasal Beema Yojna is alarming. Government has to think twice to amend the action and the implementation of the scheme. 

Maharashtra farmers are unhappy with the performance and implementation of the Pradhan Mantri Fasal Bima Yojana (PMFBY), says a report, highlighting the agriculturists’ demands for lower premium, higher compensation for losses, faster paperwork and timely compensation.

According to the report, ‘Performance Evaluation of Pradhan Mantri Fasal Bima Yojana in Maharashtra’, was brought out by the Agro-Economic Research Centre of the Gokhale Institute of Politics and Economics (GIPE) under the sponsorship of the Union ministry of agriculture and farmers’ welfare. It was authored by Sangeeta Shroff and Manasi Phadke.

The report also highlighted the challenges insurance companies have to face under the PMFBY scheme. Adverse selection was a problem for these companies as there was higher participation of farmers in drought prone areas where crop failure was a common occurrence while in areas where rainfall was assured and there was less risk of crop failure the participation was low. The report said that because of this adverse selection the scheme will invariably run into huge fiscal deficit for the government.

Another issue faced by insurance companies was that farmers took insurance cover for more risky crops but grew crops that were less risky. In the process, the farmers were able to claim indemnity for the more risky crop which normally failed, the study informed.

Calling for improvement in the implementation of the PMFBY, the report suggested that the government should study specific grievances recorded under the scheme to identify the exact pain points of farmers.

While awareness about the scheme was high that did not improve enrollment as farmers’ experience was that compensation payments were never done on time and the documentation requirements were cumbersome, the report highlighted.

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