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Thousands of Farmers Take to Streets in Gujarat, Call Modi’s Crop Insurance Scheme Biggest Scam

The problem has been particularly acute in Saurashtra and the North Gujarat region, which is currently witnessing a severe drought.
Thousands of Farmers Take to Streets in Gujarat,

Image for representational use only.Image Courtesy : NDTV

With Gujarat all set to go to polls on April 23, the failure of the Pradhan Mantri Fasal Bima Yojana, could spell out doom for Bharatiya Janata Party in the state, with farmers up in arms against the state government.

In the past two weeks, thousands of farmers have staged protests across the state over non payment of their claims. The problem has been particularly acute in Saurashtra and the North Gujarat region, which is currently witnessing a severe drought. The drought has spread across the areas of Surendranagar, Rajkot, Morbi, Junagadh, Porbandar, Jamnagar, among others where protesting farmers have organised rallies and submitted memorandum to the authorities.

Speaking to NewsClick, Arun Mehta of the Centre of Indian Trade Unions (CITU) in Gujarat said, “There are over 3,500 farmers who are still awaiting compensation and are struggling to make ends meet. The farmers paid a premium of over 25%, however, now in the time of dire need, they are getting no returns. This is a total hand in glove approach, where the insurance firms are milking profits at the cost of the livelihoods of the farmers. To us the Pradhan Mantri Fasal Bima Yojana is not a scheme but a scandal.”

The non payment of crop insurance is likely to emerge as a major election issue, when one looks at the total numbers of farmers seeking payments across the state, which reportedly run in millions.

In 2016, private insurance companies collected Rs. 2,360 crore as premium for the entire state against which only claims worth Rs. 954 crore were settled. However, farmers on the ground believe that private companies have not even approved 20% of the total claims submitted by the farmers in the region, perpetuating their suffering and minting profits. Mehta added, “The crop insurance premium burden is shared 49% each by the State and the Centre, while the remaining 2% is to be borne by the farmers.” The companies have bailed out on farmers, who are the most vulnerable at the moment, coming from scarcity hit areas.

Prime Minister Modi’s most ambitious project, PMFBY, launched in 2016, was oriented towards providing crop insurance to farmers, that is, if the crop fails due to some non-preventable reason, such as weather calamity etc., then the farmers will be compensated for this loss.

But instead of coming up with a robust government-led compensation mechanism, the Modi government has turned the loss of farmers into a profit making enterprise, rife with delayed compensation, widespread complaints of delays in claim settlement and receipt of payment have been reported right from the first season when PMFBY was implemented. Delays of as long as three to four months were common. This is catastrophic for the farmers who have suffered losses because they need the money to start their next season’s preparation immediately. Any delay forces them into the clutching arms of money-lenders, who charge exorbitant rates. The failure of the scheme and the ongoing momentum on the ground among the farmers could now prove to be the final nail in the coffin for the BJP, as far as farmers’ votes are concerned.

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