PM Fasal Bima Yojana: PMFBY 2.0, Crop Insurance, PMFBY Scheme UPSC

What is the PM Fasal Bima Yojana?

In keeping with the One Nation-One Scheme idea, the PM Fasal Bima Yojana is one of the government schemes for crop insurance in India. The scheme covers annual commercial/annual horticultural crops, oilseeds, and food crops (cereals, millets, and pulses).

PM Fasal Bima Yojana UPSC Notes

Pradhan Mantri Fasal Bima Yojana is optional for farmers who have not taken out institutional credit, but it is mandatory for all farmers who have taken out institutional loans from various types of banks. (This was changed after the Kharif season of 2020, and enrolment became voluntary). The Ministry of Agriculture is in charge of the scheme.

• PM Jan Dhan Yojana
• PM Kaushal Vikas Yojana

PM Fasal Bima Yojana Overview

Recently, to mark the 6th year of PM Fasal Bima Yojana, the government has launched Meri Policy Mere Hath which is a campaign to motivate all farmers to take insurance. The campaign includes doorstep delivery of all related documents.

Pradhan Mantri Fasal Bima Yojana	Highlights
PM Fasal Bima Yojana Premium	Kharif Crops – 2%, Rabi Crops – 1.5%, Annual commercial and horticultural crops- 5%
PM Fasal Bima Yojana Launch Date	13 January 2016
Beneficiary	Mandatory for loanee farmers (Crop Loan/Kisan Credit Card) Optional for others PMFBY 2.0 – Voluntary for all
PMFBY 2.0	Revamped in 2020 Kharif Season
Risks Covered	Localized Risk coverage like hail storms and landslide, Post-Harvest Losses coverage – cyclonic and unseasonal rain, Prevented Sowing coverage

Read: Kharif and Rabi Crops

Objectives of Pradhan Mantri Fasal Bima Yojana

The PM Fasal Bima Yojana intends to support the agricultural sector’s long-term yield generation. PMFBY will accomplish this by putting in place the following measures:

• Farmers who have lost or damaged their crops due to unforeseen events will be given financial assistance through Pradhan Mantri Fasal Bima Yojana.
• Ensuring that farmers’ incomes are stable in order for them to continue farming.
• Farmers are being encouraged to embrace and employ modern technology and agricultural practices in order to produce more efficiently and with higher yields.
• Keeping credit flowing to the agriculture sector contributes to food security, crop diversity, and the growth of agriculture in India and competitiveness, as well as safeguarding farmers from production hazards, which is another objective of PM Fasal Bima Yojana.

Risks Covered Under PM Fasal Bima Yojana

The following risks and events are covered under PM Fasal Bima Yojana.

• Yield Losses (standing crops, on a notified area basis)
• Yield losses due to non-preventable risks, such as Natural Fire and Storm, Lightning, Cyclone, Hailstorm, Tempest, Typhoon, Tornado, and hurricanes.
• Risks due to Flood, Inundation, and Landslide.
• Drought, Dry spells, and Pests/ Diseases also will be covered
• Prevention of Sowing: If the majority of insured farmers are unable to sow due to adverse weather conditions and have incurred costs for sowing.
• Post-harvest losses
• Localized issues are also covered.

Features of PM Fasal Bima Yojana

PMFBY has several unique features, such as premium subsidy for small and marginal farmers, and the use of technology for accurate assessment, etc. Let’s discuss all the features in detail below.

• Provision for full crop insurance coverage in the event of unavoidable crop loss. The goal is to keep farmers’ income stable while also encouraging innovative farming practices.
• Crop cycle insurance has been improved and expanded to cover losses that occur during pre-sowing and post-harvesting.
• PM Fasal Bima Yojana adopts an Area Approach to resolve claims for widespread damage, in which an Insurance Unit is reduced to a Village or Panchayat level for significant crops in India.
• By removing premium capping rules and other reductions on the total insured, PMFBY makes it easier for farmers to get their claims for the entire sum insured without any concessions.
• In addition to landslides and hailstorms, inundation (flooding) has been included as a localized tragedy for individual farm assessments.
• The PM Fasal Bima Yojana now provides assessments for post-harvest losses at the individual farm level. This includes losses caused by unseasonal cyclones and rainfall in India, which kill crops that had been allowed to dry for up to two weeks.
• The insurance proceeds are deposited straight into the farmer’s bank account via electronic transfer.
• In addition, from the Kharif 2016 season onwards, there’s another scheme – The unified Package Insurance Scheme (UPIS), that has been introduced for implementation, though on a pilot basis. This will be applicable to 45 districts across the country to cover other assets/activities. The activities covered will be machinery, life, accident, house, and student safety for farmers (under PM Fasal Bima Yojana / Weather Based Crop Insurance Scheme – WBCIS).

Revamped PM Fasal Bima Yojana 2.0

The Union Cabinet has authorized a revision of the PM Fasal Bima Yojana and changes to its current provisions to address issues in the implementation of the crop insurance plan. This incredible project has now been running for five years.

As a result, the redesigned PM Fasal Bima Yojana 2.0 aims to assure timely computation and payment of claims to farmers proportionate to crop loss through a number of technological interventions, as well as the government’s implementation of additional improvements to the scheme.

• N-E States: The central government’s portion of premium subsidies for north-eastern states will be enhanced from 50% to 90%.
• Information, Communication, and Education (ICE) Activities – Insurance firms are required to spend 0.5 percent of total premiums received on ICE activities.
• State adaptability: States and Union Territories will be able to set their own scale of financing for each district crop combination. States/UTs are also given the option of running the plan with a variety of risk covers.
• Maximum Premium Subsidy for the Centre: The central subsidy for unirrigated areas/crops will be limited to premium rates of up to 30%. The central subsidy for irrigated areas/crops will be limited to premium rates of up to 25%.
• Voluntary Enrolment: From the 2020 Kharif season, the PM Fasal Bima Yojana scheme is 100% optional for all farmers.
• Irrigated districts are defined as those with more than 50% of their land under irrigation.
• States will be barred from running the scheme in subsequent seasons if they fail to release the required premium subsidy for insurance companies within a certain timeframe (March 31 for Kharif Season; September 30 for Rabi Season).
• Crop Cutting Experiments (CCEs) will be conducted using technology solutions such as Smart Sampling Technique (SST).

Technology under PM Fasal Bima Yojana

Over the years, PM Fasal Bima Yojana has undergone several changes and improvements to enhance its coverage and effectiveness. One of the key areas of focus has been the use of technology to streamline the implementation of the scheme and improve its outcomes. It also promotes the idea of a Digital India by providing these technologies as follows:

• Crop Insurance App: The app allows the farmers to easily enroll in the PM Fasal Bima Yojana and report the crop loss within 72hrs of the event.
• To monitor and evaluate the loss of crops, drones, AI, satellite imagery, machine learning, and remote-sensing technology are used.
• PM Fasal Bima Yojana Portal: For land records integration.

PMFBY Scheme in Northeast India

PM Fasal Bima Yojana has been a failure in Northeast India so far, and the reasons are mentioned below.

• Mizoram, Nagaland, Manipur, and Arunachal Pradesh are the only states in Northeast India that are not covered by the PM Fasal Bima Yojana Insurance scheme. This is owing to the insurance companies’ disinterest in the northeastern states.
• In addition, the state’s failure to pay its insurance premium portion due to a lack of funds adds to the difficulties. Because of the high administrative costs in certain states, insurance firms are unwilling to bid on them.
• In the states, there is a lack of reliable land records and other historical yield data, particularly at the block and gram panchayat levels.
• Crop-cutting studies that provide a fair, precise, and accurate yield estimation of the crops, which is required for horticulture crops, are challenging to conduct.
• Except in Assam, the Northeast has a small number of loanee farmers. Hence insurance coverage is minimal.
• Due to the lack of appropriate weather forecasting infrastructure in certain areas, insurance programs reliant on the weather are impacted.

PM Fasal Bima Yojana UPSC

Pradhan Mantri Fasal Bima Yojana is an important topic from the perspective of both Prelims and Mains as it finds its relevance under current affairs and government policy. It is essential to understand the importance of this scheme, as it is a crucial policy initiative in the agricultural sector. The UPSC exam covers various aspects of government schemes and policies, and a good understanding of the PMFBY can help in answering questions related to agricultural insurance, crop protection, and farmer welfare. Aspirants can refer to the notes along with books and UPSC study materials to cover this topic comprehensively.

PM Fasal Bima Yojana UPSC Question

Question: What is the primary objective of the PM Fasal Bima Yojana? A) To provide insurance coverage to farmers against crop losses B) To provide free seeds to farmers for cultivation C) To provide subsidized loans to farmers for agricultural purposes D) To provide training and education to farmers on modern farming techniques

Answer: A) To provide insurance coverage to farmers against crop losses

Question: Under the PM Fasal Bima Yojana, what is the premium rate for farmers for Kharif crops? A) 2% B) 5% C) 10% D) 15%

Answer: B) 5%

Question: Who is eligible to apply for the PM Fasal Bima Yojana? A) All farmers in the country B) Only small and marginal farmers C) Only farmers in specific states D) Only farmers with a minimum amount of land

Answer: A) All farmers in the country

Question: Which agency is responsible for the implementation of the PM Fasal Bima Yojana? A) Ministry of Agriculture and Farmers Welfare B) Ministry of Finance C) Ministry of Rural Development D) Ministry of Human Resource Development

Answer: A) Ministry of Agriculture and Farmers Welfare

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