Analysis of Adoption of Pmfby over Nais and Mnais

A review paper on

Analysis of adoption of

PMFBY over NAIS and MNAIS

Abstract :

Whenever agriculture is taken into consideration, the prima facie fears of uncertainty, drought, flood,farmer suicide looms large in one’s head hence agriculture is perceived to be synonymous with risk and uncertainty. The large number of farmer suicides in India over crop failure have been skyrocketing, distressing and scary trend to emerge from the rural surroundings in the last few years. In a country of our size where farmers toil hard to feed a population of 1.25 billion, it is rather ironical that their deaths were reduced to mere statistics and numbers. Agriculture insurance serves as an alternative to manage risk in yield loss by the farmers. It helps in stabilization of farm production and income of the farming community. As such it is a risk management alternative where production risk is transferred to another party at a cost called premium. However, the penetration of crop insurance is found to be very less. This study is an attempt to understand the existing scenario and about the change from its origin till date. For many years now, a number of complex agriculture insurance schemes had existed. Farmers however have been unable to avail the benefits of these schemes. In most of the earlier schemes premium rates has risen drastically in recent years. The Pradhan Mantri Fasal Bima Yojana has now replaced all other schemes and integrated the benefits in one single scheme. The government has decided to get rid of the „capping‟ mechanism that did not allow farmers to derive legitimate benefits previously. The drastic reduction in premium is likely to result in an increase of burden to centre about 500 percent. This means that the farmers shall derive “MAXIMUM BENEFITS by paying MINIMAL PREMIUM”. The PMFBY will be applicable from the Kharif season of 2016

Introduction :

Pradhan Mantri Fasal Bima Yojana , was introduced by hon’ble Prime minister Shri Narendra Modi in January 2016 . It is a crop insurance policy scheme which incorporates features of existing crop insurance schemes. It has replaced modified NAIS - National agriculture insurance scheme. The scheme is in sync with the stated objective of the government to double farmer income by 2022

With back-to-back droughts, and unseasonal rain and hail in certain pockets, it became clear that the risks in farming are on the rise, and the existing system of crop insurance was nowhere near meeting the needs of the peasantry. In this context, the new scheme is surely a step in the right direction and very timely — which will help in saving Indian agriculture from the increasing risks of nature The premium rates to be paid by farmers are very low and balance premium will be paid by the Government to provide full insured amount to the farmers against crop loss on account of natural calamities. The low premium will drive penetration and enrolment and make the insurance scheme viable