Fasal Bima Yojana sees decline in coverage

Fasal Bima Yojana launched in the 2016-17 kharif (summer sown crop) season, has reported a 15% decline in coverage of farmers in its second year (2017-18). The prime reason for this decline is said to be the loan waiver announced by several states last year.

According to the data shared by the government in Parliament, farmers’ enrolment declined from 57.3 million in 2016-17 to 48.8 million in 2017-18 with Karnataka, Rajasthan, Uttar Pradesh, Bihar and Maharashtra reporting substantial decline.

Incidentally, four of these five states – Karnataka, Rajasthan, UP and Maharashtra – announced loan waiver schemes last year, affecting the spread of the Pradhan Mantri Fasal Bima Yojana (PMFBY) in 2017-18.

The agriculture ministry in its written response to a question in Rajya Sabha  said, “This is mainly due to factors like announcement of debt waiver scheme in Maharashtra and Uttar Pradesh, farmers’ perception of  mitigated risk in 2017-18 which was a good monsoon year, de-duplication due to Aadhaar being made mandatory for coverage etc.”

Figures shared by the ministry in Parliament showed that overall premium and claims under PMFBY increased in 2017-18 compared to 2016-17 despite decline in enrolment.

Gross premium increased from Rs 165 billion in kharif 2016 to Rs 195 billion in kharif 2017 while approved claims increased from Rs 104 billion to Rs 137 billion during the period.