June, 2021 India: States seek Centre’s permission to implement Beed model of crop insurance scheme

Ahead of the new kharif season, a new model is gaining attention, that is, the Beed model of implementation of Pradhan Mantri Fasal Bima Yojana (PMFBY). This is the central government’s flagship programme which cushions farmers from crop loss.

According to ocials, states have asked the central government to allow them to implement this model, in which insurance companies reimburse a portion of the premium collected back to the states.

The premium for the programme is collected with state and central governments bearing the maximum financial load while farmers pay only a fraction of it. The scheme has been well received among farmers due to the financial benefits it oers.

However, over the years it has proven to be unpopular amongst the insurance companies due to the high compensation they have had to pay. The scheme has also attracted the attention of farmer leaders who say it does not pay enough compensation. The increasing financial burden due to the higher rates of premium has provoked the state governments to have a relook at the scheme.

In this context, the implementation of the scheme in the drought-prone district of Beed, which regularly reports incidents of crop loss due to extreme climatic events, is being considered. For kharif last year, none of the insurance companies had responded to tenders floated by authorities to implement the scheme there. The Indian Agricultural Insurance Company was asked to implement the scheme here under a special model. Under this model, the insurance company provides a cover of 110 percent of the premium collected. In case the compensation amount exceeds the 110 percent mark, the excess will be borne by the state government. But if the compensation amount is lower than the premium collected, the insurance company will reimburse a portion of the same to the state government. The latter is more likely to happen in case of normal monsoon, as the one India had seen in 2020.

So, last kharif, Beed had seen a collection of total premium of INR 8.03 Billion (USD 110.28 Million) (in which farmer share was INR 608.2 Million, state and central government share INR 4.08 Billion and INR 3.33 Billion respectively). While the compensation for crop loss was calculated at INR 86 Million. After deducting INR 1.60 Billion, the insurance company had returned INR 6.34 Billion to the state government. This scheme, government ocials said, will allow the state to get reimbursement of the premium amount. Discussions about the same are being held with the central government but the scheme is unlikely to be implemented in the upcoming kharif season, according to ocials.

Source : https://indianexpress.com/ India: In Cyclone Tauktae wreaks havoc on crops; Mango, banana plantations worst hit

Cyclone Tauktae, which claimed the lives of 45 persons in Gujarat, has also caused huge damage to standing summer crops, with the Kesar variety of mango, that is mainly grown in the coastal districts of Gir Somnath and Junagadh, bearing its brunt along with the coconut and banana plantations in parts of the state, farmers said.

Coconut plantations in Junagadh, Gir Somnath, parts of Amreli and Bhavnagar, and banana plantations in Bharuch, Tapi, Vadodara, Anand, and parts of Kheda, among other districts, were badly hit, in addition to other standing summer crops, farmers said. Hundreds of mango trees were uprooted in plantations across Junagadh, Gir Somnath, and in the Valsad districts, with nearly all the mangoes falling to the ground from the trees in the cyclone that made landfall on Monday (17 May 2021) night, the growers said. "Nearly 40 percent of Kesar mango trees have been uprooted, which is huge damage, as a tree takes nearly 15 years for crop. Almost all the mangoes on the trees fell to the ground, and these unripe mangoes are of not much use to the growers," Mr.Patel, who is the Talala APMC (Agricultural Produce Market Committee) chairman said.

Valsad district, where both Kesar and Alphonso varieties of mangoes are grown, also suered massive damage, the growers said. The situation of banana plantations has been no dierent. Gusty winds destroyed the entire plantations of this fruit. "There were 14,000India: banana plants, India out of which- Over 9,000 were2,000 completely uprooted and destroyed," said one grower at Upleta in Rajkot district. Sagar Rabari, a farmer leader and president of Gujarat Khedut Samaj, said, "The statehectares did not witness such of a cultivatedcyclone in a long time, which caused a massive damage to the horticulture as wellarea as summer affected crops." All thein crops that were damaged were almost ripe and ready to be stored at home or hit the markets, he said. Puducherry due to Chief Minister Vijay Rupani had assured farmers that the government will undertake an immediate survey of the damages caused by the cyclone to the summer cropsCyclone and mango, Nivar coconut, and banana plantations, and assistance will be provided accordingly. Summer crops, such as bajra, moong, urad, summer groundnuts, sesamum, as well as vegetables, and guar gum are mainly grown in and regions of the state, while north Gujarat districts grow bajra and groundnut. Paddy and bajra are also grown in large quantities in districts, which also grow mung. In Saurashtra, bajra, moong, groundnut, and sesamum are grown in large quantities during summer. Vegetables are grown across all the regions of Gujarat during this season. The cyclone made landfall between Diu and Una town of Gir Somnath district in Gujarat.

Source : https://timesofindia.indiatimes.com/ Madagascar: IFC, Government of Madagascar Partner to Develop Insurance to Protect Smallholder Farmers

Madagascar's farmers stand to build stronger climate resilience, increase productivity, and have easy access to financial services thanks to an agricultural insurance programme announced on May 5th, 2021 by IFC and the Government of Madagascar. IFC is a member of the World Bank Group.

Under the program, IFC will help Malagasy insurance companies develop targeted insurance products to protect farmers from weather-related risks and other natural disasters that threaten their livelihoods and undermine creditor confidence. Agricultural insurance will help protect farmers from a wide range of natural disasters, including cyclones, droughts, floods, and pest invasions. Natural disasters cost Madagascar's economy on average 1 percent of GDP annually.

Agriculture is a significant contributor to Madagascar's economy, accounting for about a quarter of the country's GDP and 64 percent of total employment. Smallholder farmers make up about 70 percent of the farming population, yet more than half cite limited access to financial services as a key constraint holding back their productivity and incomes.

"The Ministry of Agriculture, Livestock and Fisheries is committed to developing agricultural insurance for smallholder farmers to achieve food self-suciency as well as accelerated, inclusive, and sustainable growth. The establishment of an agricultural insurance system is a sustainable solution to develop the agricultural sectors. This will encourage banks and financial institutions to support farmers through access to credit to overcome the risks associated with climate change," said Mr. Fanomezantsoa Lucien Ranarivelo, the Minister of Agriculture, Livestock, and Fisheries. "Smallholder farmers are often on the front lines of risk and they deserve insurance programs specifically targeted to meet their needs. Agricultural insurance can help them enjoy a more predictable and stable cash flow, enabling them to repay loans and improve credit worthiness, boost production, and build more resilience against natural disasters and other shocks," said Marcelle Ayo, IFC's Country Manager for Madagascar.

Farmers who are insured often lower their credit risks, easing their access to other financial services, such as loans. This has been shown in countries such as Kenya, Nigeria, and the Philippines, where banks, microfinance institutions, and insurance companies have collaborated to provide bundled services to smallholder farmers. The Madagascar project is funded by the Global Index Insurance Facility (GIIF), a multi-donor program managed by the World Bank Group created to address the scarcity of aordable insurance protection against weather and catastrophic risks in emerging countries. GIIF is supported by the European Commission, the African, Caribbean, and Pacific (ACP) Group of States, the Netherlands Ministry of Foreign Aairs, the German Federal Ministry of Economic Cooperation and Development (BMZ), and the Japan Ministry of Finance. About IFC

IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. IFC works in more than 100 countries, using their capital, expertise, and influence to create markets and opportunities in developing countries. In the fiscal year 2020, IFC invested $22 billion in private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity. For more information, visit www.ifc.org.

Source : https://pressroom.ifc.org/

For more details email us at [email protected] Address: J. B. Boda Insurance & Reinsurance Brokers Pvt. Ltd. Maker Bhavan No. 1, Sir. Vithaldas Thackersey Marg,Mumbai 400 020, India

+91-22-6631 4949 /JBBodaGroup /j.b.boda_group/ www.jbboda.net /jbb-boda-group /channel/UCJ91omGfbW8I_j6nimghUSQ