Nitish Kumar introduces state scheme for farmers; discredits Centre’s plan

Patna: Continuing his tirade against centre’s crop insurance scheme, Bihar CM Nitish Kumar on Tuesday came up with his own scheme through which the farmers can claim compensation without paying any premium.

The state government claimed that the new scheme — ‘Bihar Rajya Fasal Sahayata Yojna’– would have a wide coverage as NDA’s ‘Pradhan Mantri Fasal Bima Yojana’ assists farmers who avail loans from national and cooperative banks or financial institutions.

Under the central scheme, both the state and the centre bear 49% of the cost of premium. Target beneficiaries have to pay the rest 2%. The centre fixes the amount which a state has to pay to insurance companies under this scheme.

In the 2016 Kharif season, while Bihar paid ₹ 495 crores as its share, farmers got just ₹ 221 crores as compensation for crop damage, said Principal Secretary (Cooperatives) Atul Prasad.

While the centre’s scheme marginally benefitted farmers who had taken loans, the new scheme covers all categories of farmers, he said. The scheme kicks in from the current Kharif season.

Ever since the central scheme was launched, Nitish Kumar has been critical of it, saying the real beneficiaries won’t be farmers but insurance companies. Kumar was then part of an alliance with the RJD and Congress.

According to the new scheme passed by the state cabinet, all farmers who suffer crop losses of up to 20% of the threshold yield will get ₹ 7,500 per hectare subject to a maximum compensation amount of ₹ 15,000. The threshold yield is calculated on the basis of the average yield for the last seven years

For crop losses beyond 20% of the threshold yield, the compensation has been fixed at ₹ 10,000 per hectare, with a cap of ₹ 20,000. This in effect means the new scheme aims at benefitting largely small farmers who make up a sizable chunk of the state’s agrarian population.

Sources say the move also comes against the backdrop of a back and forth between Kumar’s party JD(U) and the BJP over who — Kumar or Prime Minister Narendra Modi — would be the face of the BJP-led National Democratic Alliance (NDA) campaign in Bihar for next year’s general elections. It’s seen as a pitch for a greater share in the number of seats by the JD(U) which walked out of the alliance with the RJD last year and re-joined the NDA fold.

Kumar, sources in the JD(U) say, is upset with the centre allocating ₹1,200 crores against ₹ 7,600 crores he had asked as compensation for the floods that ravaged Bihar last year, killing over 500 people.

Slighted by the rejection of its flood relief claim, the Bihar government feels the centre has not measured up to the scale of the tragedy. It now seeks to project its crop insurance scheme as a model alternative which could prod more states to opt out of the central scheme.