Rs 4k cr more to be spent on crop insurance scheme

According to media reports, the government will have to spend Rs 4,000 crore more on the revamped crop insurance scheme after making it voluntary from the upcoming kharif season. Within three years of its launch, the average number of participating farmers is 37.5 million with 58% of them having crop loan. The annual premium is likely to increase by 2% from existing 12.5% owing to a possible number of participating farmers by 30%.

“Insurance cover is set to become costly with government’s share in total premium likely to go up by Rs 4,000 crore – Centre and states contributing equally. Since launch of this scheme in 2016, government pays annual premium in the range of Rs 24,000-25,000 crore. In the ensuing crop season, government may have to pay `28,000-30,000 crore with lower base of farmers,” said  a source.