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Union agriculture ministry data, released in June, showed that insurance companies collected Rs22,338 crore in 2016-17 in crop insurance premiums. Until 21 July, only Rs5,875 crore, or 45% of the total claims of Rs12,490 crore made by farmers, had been paid. Photo: Mint
Union agriculture ministry data, released in June, showed that insurance companies collected Rs22,338 crore in 2016-17 in crop insurance premiums. Until 21 July, only Rs5,875 crore, or 45% of the total claims of Rs12,490 crore made by farmers, had been paid. Photo: Mint

Karnataka Congress’ kisan wing files CBI complaint against PMFBY citing irregularities

Karnataka Congress' farmers wing alleges the Pradhan Mantri Fasal Bima Yojana, launched in 2015, was ostensibly meant to help farmers, but instead was helping big insurance companies make profits

Bengaluru: The farmers’ wing of the Congress party’s Karnataka unit on Thursday filed a case with the Central Bureau of Investigation (CBI) alleging irregularities in the Pradhan Mantri Fasal Bima Yojana (PMFBY), a central crop insurance scheme.

Sachin Meega, president of the Kisan-Khet Mazdoor Congress, a division of the state unit of the party, said he had filed the complaint on behalf of all Indian farmers and to weed out the irregularities.

The Siddaramaiah-led Congress government of Karnataka has been wooing farmers in the state with loan waivers and other populist schemes to win the backing of the 7.5 million-strong farmers’ community in the run-up to next year’s assembly elections.

The Congress government in Karnataka has also stepped up attacks on Prime Minister Narendra Modi’s National Democratic Alliance (NDA) government at the Centre on issues like a refusal to waive loans taken by farmers from nationalised banks and reassessment of state disaster relief funds.

Meega, in his complaint, said the PMFBY, launched in 2015, was ostensibly meant to help farmers, but instead was helping big insurance companies make profits.

Union Agriculture ministry data, released in June, showed that insurance companies collected Rs22,338 crore in 2016-17 in crop insurance premiums. Until 21 July, only Rs5,875 crore, or 45% of the total claims of Rs12,490 crore made by farmers, had been paid to farmers.

According to a Comptroller and Auditor General (CAG) report released in the same month, central and state governments had spent Rs32,606 crore on crop insurance schemes in the period from 2011-12 to 2015-16, but could not ensure that the money spent “reached the intended beneficiaries or achieved the intended purposes." A subsequent report by the Centre for Science and Environment said the scheme had helped insurance companies earn “massive profits".

ALSO READ: Farmers await crop insurance payout, 55% claims pending

Karnataka has endured four years of drought; this year, rainfall has been copious although delayed.

The Karnataka government has even started deducting insurance premiums for almost all crop loans disbursed for continued central assistance to help mitigate deficient rainfall and resulting crop damage, which helped increase the farmers enrolled under the PFMBY from 872,000 in 2015 to 944,000 in 2016, Mint reported in December last year.

Compensation disbursed under the PMFBY was much lower than the premiums paid, according to multiple farmers. Naveen Kumar, a 40-year-old farmer from Hasan—about 185 km from Bengaluru—had earlier told Mint that he paid Rs2,400 (Rs1,200 per acre) under the crop insurance scheme but received only Rs1,600 as compensation.

Under pressure from farmer groups, opposition parties and heading into elections next year, Siddaramaiah in June announced a Rs8,165 crore waiver of crop loans (upto Rs50,000 per farmer), benefits of which are yet to reach all farmers in the state.

The three major parties in Karnataka—Congress, Bharatiya Janata Party (BJP) and the Janata Dal (Secular) —have been trying to reach out to the politically influential farmers community with assurances like farm loan waivers and efforts to resolve the Cauvery and Mahadayi river water disputes with neighbouring states as well as higher prices for their produce, if they are voted to power in the 2018 assembly elections.

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