India's farm insurance proves costly for most vulnerable
After years of low rainfall devastating soya bean crops on his central Indian farm, Dileep Patidar last year planted the pulse urad as it needs less water and he counted on the government's crop insurance scheme to cover him if it did not work out. The Indian government runs the world's largest agriculture crop insurance scheme, subsidising insurance to reduce farmers' premiums But an analysis by the Indian think tank, the Centre for Science and Environment (CSE), said farmers living in climate-vulnerable districts like Mandsaur faced higher premiums, had lower levels of insurance cover and received lower payouts compared to farmers in lower-risk districts. This undermines the purpose of a scheme that could be a crucial tool in building farmers' resilience, the analysis said. Climate change is increasingly impacting India's crops, with more than 4 million hectares affected by extreme weather events in 2024, nearly double the previous year, according to India's Atlas of Disasters, maintained by CSE. Just under half - 46 per cent- of India's 1.4 billion people are employed in agriculture, a sector that supports 70 per cent of rural households and generates 16 per cent of the country's GDP, according to Indian government data. Patidar's monsoon crops were insured, but he is frustrated at still waiting for a payout while he said farmers in neighbouring villages had already been compensated. "I checked my bank passbook and saw that around 10,000 rupees ($115) was deducted for the insurance premium, but to what end?" he asked. Launched in 2016, the farm insurance scheme aims to protect farmers' incomes by aiming to insure 50 per cent of all agricultural land by 2020, but by 2021 only 30 per cent was insured, according to the latest ofcial data. CSE Programme Director Amit Khurana said India's crop insurance scheme could be a vital safety net for climate-vulnerable farmers. But, he said, "farmers must perceive a benet in adopting it which means those vulnerable have to pay less, if at all, for better support". However, this is not currently the case. CSE analysed 2023 monsoon crop insurance data for 21.5 million farmers in agricultural districts classied by the government as vulnerable to very high and high climate change risk. insurance payouts. "From farmers' perspective, the main challenge with the insurance scheme remains the lack of transparency," said Donthi Narasimha Reddy, a public policy expert in the southern state of Telangana. Farmers often talk about not receiving any pay out after losing their crops, or the amount being too little to help, Reddy said. insurance payouts. "From farmers' perspective, the main challenge with the insurance scheme remains the lack of transparency," said Donthi Narasimha Reddy, a public policy expert in the southern state of Telangana. Farmers often talk about not receiving any pay out after losing their crops, or the amount being too little to help, Reddy said.
