NEW DELHI : New Delhi: With El Niño conditions intensifying, the Union finance ministry has directed insurers to expedite enrolment under the Pradhan Mantri Fasal Bima Yojana (PMFBY) to widen insurance coverage for the current kharif season, according to two people familiar with the matter.

It has asked insurers to strengthen operational readiness in 315 vulnerable districts across Madhya Pradesh, Maharashtra, Gujarat, Uttar Pradesh, Rajasthan, Karnataka, Bihar, Jharkhand, Telangana, Andhra Pradesh and Odisha.

The directive comes as the Centre steps up efforts to protect farmers from the impact of a weak monsoon, which could hurt agricultural output and rural incomes, and fuel food inflation.

India recorded its driest June in more than a decade and the fifth-driest since records began in 1901, with south-west monsoon rainfall remining 39.8% below the long-period average (LPA).

The India Meteorological Department has revised its 2026 forecast for south-west monsoon, which accounts for nearly 70% of the country's annual rainfall, to 90% of the LPA from the 92% projected earlier, citing El Niño conditions.

“Due to the El Niño effect, crop production and yields are expected to decline. If farmers enrol under the PMFBY scheme, they can receive compensation in the event of crop failure. Claims are assessed based on agro-climatic conditions and the results of crop cutting experiments (CCEs), using the average yield of the previous seven years,” said Khem Chand, principal scientist (agricultural economics), ICAR-National Institute of Agricultural Economics and Policy Research (ICAR-NIAP).

Slow start

The agriculture ministry and the Indian Council of Agricultural Research (ICAR) have identified 315 districts as vulnerable to weak monsoon conditions. Of these, 111 districts have been classified as high priority, with irrigation coverage below 25%; 76 districts as medium priority, with irrigation coverage between 25% and 50%; and 128 districts as low priority, benefiting from relatively better irrigation through dams and other sources.

The farm ministry has also written to all states and insurance companies, asking them to intensify awareness campaigns under the PMFBY and the Restructured Weather Based Crop Insurance Scheme (RWBCIS).

The letter, reviewed by Mint, directs stakeholders to prepare micro-level plans with district administrations and other agencies to maximize farmer participation and ensure timely enrolment before the deadline.

The PMFBY, launched in 2016, is the Centre's flagship crop insurance programme that protects farmers against crop losses arising from natural calamities, pests and diseases. Farmers pay 2% of the premium for Kharif crops, 1.5% for Rabi crops and 5% for commercial and horticultural crops, while the balance actuarial premium is shared between the Centre and states in a 50:50 ratio.

For the north-eastern states (from kharif 2020) and Himalayan states (from kharif 2023), the Centre bears 90% of the premium subsidy.

The Kharif season (June to October) is particularly important as it contributed 53.2% of India's annual foodgrain production of 142.23 million tonnes in 2025-26.

As of 7 July, more than 218,000 farmers enrolled under the scheme this year, compared with 20.2 million farmers covered during the 2025 kharif season. About 269,000 hectares had been insured against 25 million hectares last year, while the sum insured stood at ₹1,753.72 crore, a fraction of 2025's ₹1.36 trillion.

Last year's kharif season saw 83.7 million applications under the PMFBY, with coverage extending across 517 districts in 24 states and Union territories. Gross premium collections stood at ₹12,833.41 crore, while claims worth ₹5,985 crore had been paid, benefiting 3.44 million farmers, according to the PMFBY administrative dashboard.

Mint's queries emailed to the finance, consumer, and agriculture ministries, PMFBY CEO, and the Prime Minister's Office on Monday remained unanswered.

Operational challenges

Experts say faster enrolment would require coordination beyond insurers. “There are two challenges that we see. Helping farmers through faster claim settlements depends on the pace of enrolment. Enrolment, in turn, depends on state governments completing CCEs and on the pace of loan disbursements by financial institutions, with which crop insurance is bundled. These are factors insurers do not control,” said Vivek Iyer, partner, Grant Thornton Bharat.

He added that an El Niño-induced rise in crop losses could also strain the balance sheets of public sector general insurers. “This could result in increased claims on state-run insurers that have below-par solvency ratios. Inter-regulatory cooperation will be important to fast-track claims, and a clear government subsidy mechanism for PMFBY-related claims would help address the financial stress on insurers,” Iyer said.

NEW DELHI : New Delhi: With El Niño conditions intensifying, the Union finance ministry has directed insurers to expedite enrolment under the Pradhan Mantri Fasal Bima Yojana (PMFBY) to widen insurance coverage for the current kharif season, according to two people familiar with the matter.

It has asked insurers to strengthen operational readiness in 315 vulnerable districts across Madhya Pradesh, Maharashtra, Gujarat, Uttar Pradesh, Rajasthan, Karnataka, Bihar, Jharkhand, Telangana, Andhra Pradesh and Odisha.

The directive comes as the Centre steps up efforts to protect farmers from the impact of a weak monsoon, which could hurt agricultural output and rural incomes, and fuel food inflation.

India recorded its driest June in more than a decade and the fifth-driest since records began in 1901, with south-west monsoon rainfall remining 39.8% below the long-period average (LPA).

The India Meteorological Department has revised its 2026 forecast for south-west monsoon, which accounts for nearly 70% of the country's annual rainfall, to 90% of the LPA from the 92% projected earlier, citing El Niño conditions.

“Due to the El Niño effect, crop production and yields are expected to decline. If farmers enrol under the PMFBY scheme, they can receive compensation in the event of crop failure. Claims are assessed based on agro-climatic conditions and the results of crop cutting experiments (CCEs), using the average yield of the previous seven years,” said Khem Chand, principal scientist (agricultural economics), ICAR-National Institute of Agricultural Economics and Policy Research (ICAR-NIAP).

Slow start

The agriculture ministry and the Indian Council of Agricultural Research (ICAR) have identified 315 districts as vulnerable to weak monsoon conditions. Of these, 111 districts have been classified as high priority, with irrigation coverage below 25%; 76 districts as medium priority, with irrigation coverage between 25% and 50%; and 128 districts as low priority, benefiting from relatively better irrigation through dams and other sources.

The farm ministry has also written to all states and insurance companies, asking them to intensify awareness campaigns under the PMFBY and the Restructured Weather Based Crop Insurance Scheme (RWBCIS).

The letter, reviewed by Mint, directs stakeholders to prepare micro-level plans with district administrations and other agencies to maximize farmer participation and ensure timely enrolment before the deadline.

The PMFBY, launched in 2016, is the Centre's flagship crop insurance programme that protects farmers against crop losses arising from natural calamities, pests and diseases. Farmers pay 2% of the premium for Kharif crops, 1.5% for Rabi crops and 5% for commercial and horticultural crops, while the balance actuarial premium is shared between the Centre and states in a 50:50 ratio.

For the north-eastern states (from kharif 2020) and Himalayan states (from kharif 2023), the Centre bears 90% of the premium subsidy.

The Kharif season (June to October) is particularly important as it contributed 53.2% of India's annual foodgrain production of 142.23 million tonnes in 2025-26.

As of 7 July, more than 218,000 farmers enrolled under the scheme this year, compared with 20.2 million farmers covered during the 2025 kharif season. About 269,000 hectares had been insured against 25 million hectares last year, while the sum insured stood at ₹1,753.72 crore, a fraction of 2025's ₹1.36 trillion.

Last year's kharif season saw 83.7 million applications under the PMFBY, with coverage extending across 517 districts in 24 states and Union territories. Gross premium collections stood at ₹12,833.41 crore, while claims worth ₹5,985 crore had been paid, benefiting 3.44 million farmers, according to the PMFBY administrative dashboard.

Mint's queries emailed to the finance, consumer, and agriculture ministries, PMFBY CEO, and the Prime Minister's Office on Monday remained unanswered.

Operational challenges

Experts say faster enrolment would require coordination beyond insurers. “There are two challenges that we see. Helping farmers through faster claim settlements depends on the pace of enrolment. Enrolment, in turn, depends on state governments completing CCEs and on the pace of loan disbursements by financial institutions, with which crop insurance is bundled. These are factors insurers do not control,” said Vivek Iyer, partner, Grant Thornton Bharat.

He added that an El Niño-induced rise in crop losses could also strain the balance sheets of public sector general insurers. “This could result in increased claims on state-run insurers that have below-par solvency ratios. Inter-regulatory cooperation will be important to fast-track claims, and a clear government subsidy mechanism for PMFBY-related claims would help address the financial stress on insurers,” Iyer said.