Indian farmers faced with subsidy crisis
Farming communities across states are faced with acute financial crunch owing to the failure of state governments to pay their part of the subsidy towards the Pradhan Mantri Fasal Bima Yojana (PMFBY). PMFBY has turned into a flop after nearly INR 2822 crores worth of subsidy remains unpaid by the various state governments after the insurance scheme was launched way back in 2016.
Farmers hit by 2822 cr pending subsidy
In practice, the insurance companies release the amount payable to the farmers within a span of two months from the date of crop experimenting or harvest date. However, a total of INR 3381 crores of subsidy is yet to be paid towards the Bima Yojana, of which INR 2822 crores is pending from the various state governments.
State govts fail to clear the subsidy load
The response about state governments failing to clear the subsidy amounts was tabled in parliament by the agricultural minister. Though the exact cause for the defaulting was not specified, it was surmised that many state governments were unable to bear the load cast by the subsidy towards the insurance scheme.
The farming community complained bitterly, stating the scheme looks good only on paper. They further said as per the scheme, we have to pay only five to seven percent of the premium. The rest of the burden is meant to be shared evenly by the Center and state governments.
Most farmers want to opt out of PMFBY
However, in practice, the subsidy amounts never get released and we fail to benefit from the Yojana, costing the farmers. Consequently, more and more farmers have started moving out of the scheme.
The government subsidies failing to reach the farm hands on time has affected a large portion of the 2938.7 lakh farmers who got enrolled in the scheme. A corpus of INR 10,49,342 crores was created by late 2021.
The government’s flagship scheme to secure the farmers against the vagaries of nature, including monsoon failures and floods seems all set to get doomed in the absence of a proper regulatory framework.
