With reference to the editorial, "Improved crop insurance" (January 20), earlier initiatives by some states to introduce crop insurance either did not take off or their success was limited due to a half-hearted approach and lack of linkages. This time around, Centre-state participation and overall awareness about the need to make farming bankable should make a difference. The Centre and the states should revisit the subsidies provided to the farm sector in terms of interest, inputs and cost of electricity, pool these and provide need-based subsidy to make individual farming economically viable.
Although going back to the practice of three components - cash, kind and provision of inputs, and consumption component in gross bank credit - may not be practical, human involvement in appraisal and supervision of credit cannot be substituted by technology.
There is an urgent need to monitor and supervise insurance schemes through bank and insurance staff, as inadequate field supervision had contributed to the failure of past schemes. The temptation to outsource and depend solely on paperless reporting should be avoided.
The problems listed in the last paragraph of the editorial are real. But insurance companies are now waking up to real-life situations. Let us hope that where banks find the activity bankable, insurance cover is not denied for want of a "flawless land title". It is in the interest of insurance companies to establish the credibility of a scheme so that there is wider coverage, which would allow cross-subsidisation of outgo for claims settlement. Awareness should be spread among farmers about the role of insurance as an instrument of savings to meet unexpected risks.
M G Warrier Mumbai
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