PMFBY: Government Receives More Applications from Small Farmers, Less from Marginal Ones

Under Pradhan Mantri Fasal Bima Yojana (PMFBY), farmers who own up to two hectares of land have emerged as the leaders in insuring their crops. They are technically referred to as small farmers, and they are ahead of marginal farmers as the group most likely to choose the scheme nationwide (cultivators with up to or less than one hectare of land).

Due to the unpredictable weather conditions in India, farmers have found the crop insurance scheme to be a lifeline. A small percentage of the premium is paid by cultivators when they sign up for the Scheme; the majority of the cost is covered by the state and the Centre.

In the case of crop loss, the insurance companies provide the farmer’s compensation to help them recover financially. For now, the scheme is optional for both loanee and non-loanee farmers to have the opportunity to participate in the Scheme. Therefore, by paying a premium of just Rs 1,145.35, a soyabean farmer in Maharashtra may claim compensation up to Rs 57,267 per hectare.

The crop statistics for the Kharif of 2022–23 reveal that small farmers are overwhelmingly choosing the scheme. The percentage of marginal and large landholders is comparatively less. Small farmers are those who have up to two hectares of land under cultivation, while marginal farmers are those who have less than one hectare.

Despite having the most acreage in the nation, marginal farmers enroll far later in the scheme than small farmers, giving them a comfortable cushion against financial loss. Only 10.14% of enrolment was seen from the marginal farmers while 83.12 percent of enrolment was seen from small farmers.

In Madhya Pradesh, 52.34 percent of small farmers and 14.53 percent of marginal farmers opted for PMFBY. In Rajasthan, 20.27 marginal farmers chose the central scheme, compared to 49.83 percent of small farmers. In Uttar Pradesh, 32.23% of marginal farmers and 5921% of small farmers participated in the scheme. These percentages were 16.29% and 78.79% in Odisha, respectively. Similar patterns were seen in other states as well.

Farmers who see risk in their crops choose insurance coverage, according to Sangeeta Shroff, professor, and director of the Gokhale Institute of Politics and Economics in Pune.

"Accordingly, cotton and soybean growers in Marathwada and Vidarbha are more excited about insuring their crops than the paddy growers in Konkan. The former is more at risk of threats from weather; therefore, insurance coverage helps them reduce their losses, she added.

The crop insurance scheme has seen sustained criticism from farmers and political leaders alike.

While some states, like Gujarat, have even moved out of the scheme, leaders across the political parties have advocated for reforms.