Parliamentary Panel’s Recommendations on Crop Insurance & Residue Management

Key Recommendations on PMFBY (Pradhan Mantri Fasal Bima Yojana)

• Coverage Expansion
  • Include damages caused by stray animals in crop loss coverage under PMFBY.
  • Rationale: Farmers face frequent crop destruction from stray animals, leading to financial losses.
• Free Compulsory Crop Insurance for Small Farmers
  • Coverage for farmers with land holdings of up to 2 hectares (similar to PMJAY health insurance model).
  • Expected Benefits:
    • Strengthens financial stability of smallholder farmers.
    • Encourages investment in farming practices.
    • Reduces risk of falling into debt traps due to crop failures.
• Operational Challenges in PMFBY
  • Delays in fund release from states.
  • Inadequate compensation against crop losses.
  • The panel urged the government to resolve these issues for improved effectiveness.

Proposal to Curb Crop Residue Burning

• Financial Incentives for Farmers
  • ₹100 per quintal of paddy to be provided as compensation for collection and disposal of crop residue.
  • Payment via Direct Benefit Transfer (DBT), ensuring transparency and efficiency.
  • Additional to Minimum Support Price (MSP).
• Alternative Crop Residue Management
  • Conversion to bioenergy, composting, and other productive uses instead of burning.
  • Need for policy interventions, farmer education, and technological innovations to support adoption.
• Long-term Strategy
  • Pilot study on alternative residue management costs and benefits before scaling financial incentives.

Potential Impact of Recommendations

• Farmer Welfare
  • Expanded insurance coverage reduces financial risks for small farmers.
  • Compensation for crop residue collection provides economic relief and incentivizes sustainable farming.
• Environmental Benefits
  • Reduced air pollution from stubble burning, especially in North India.
  • Promotion of eco-friendly residue management techniques.
• Economic & Policy Considerations
  • Higher fiscal burden on the government due to increased PMFBY coverage and direct incentives.
  • Need for efficient policy execution to ensure timely fund disbursement.

The committee’s recommendations focus on expanding crop insurance, ensuring financial security for small farmers, and tackling the environmental hazards of stubble burning. While implementation challenges exist, these measures could significantly enhance agricultural sustainability and farmer resilience in India.

Source: BL