NCIP implementation, a rude shock to farmers: Jaya

The move without proper consultation from stakeholders calls for an increased premium from farmers

Tamil Nadu government has said the Centre's "abrupt decision" to implement National Crop Insurance Programme from Rabi season 2013-14 will make farmers pay an increased premium and suggested that Central and state governments bear the additional "burden premium" of 2%.

Chief Minister Jayalalithaa told Prime Minister Manmohan Singh that NCIP had been introduced by Centre "in a very hasty manner" without any consultation with stakeholders," with state governments and farmers not being taken into confidence.

The Centre's move to implement NCIP without proper consultation with stakeholders, especially state governments, had come as a "rude shock" to farmers, she said.

In Tamil Nadu, the State Government extends a subsidy of 45-50% on the premium payable besides 50% of the crop loss compensation shareable with the Government of India over and above the premium collected, she informed Singh in a letter dated January 5, which was released today.

The new measure will result in an "enormous financial burden due to the steep increase in the crop insurance premium under the new programme."

Due to state government's encouraging more farmers to enroll in the earlier National Agriculture Insurance Scheme (NAIS), which, she said, had now been withdrawn, 9.76 lakh farmers had been enrolled in it as of 2012-13.

The State Government extends 45% to 50% premium as subsidy under NAIS to all farmers, in addition to the meagre 5% subsidy extended only to Small and Marginal farmers by Centre, she said.

NAIS guidelines stipulate premium level of 2% to 3.5% of the sum insured, depending on the season and crop, she said adding the state government extends 50% premium subsidy, enabling the farmers to pay only 1% to 1.75% of sum insured.

In the new NCIP, premium payable by farmers increases to 3.75% and above under Modified National Agriculture Insurance Scheme, and to 4.8% and above under Weather Based Crop Insurance Scheme. "With such high premia, I really doubt whether farmers will come forward to insure their crops and mitigate their risks," she said.