Date:08/11/2003 URL: http://www.thehindu.com/2003/11/08/stories/2003110805341200.htm

National

Centre seeks States' cooperation for FIIP

By Our Special Correspondent

NEW DELHI NOV. 7. The Centre has sought the cooperation of the States in implementing the proposed Farm Income Insurance Programme (FIIP).

Some of the States have, however, sought a more realistic computation of the minimum support price (MSP) and a lesser than seven years' average time for arriving at the average yield as the guaranteed income is to be based on the yield and the MSP. They have also raised questions on the operational aspects of the proposed programme.

Addressing a meeting of the Collectors and State Agriculture Secretaries concerned here on Thursday to discuss the implementation of the project, the Union Agriculture Minister, Rajnath Singh, said the programme was conceived as the farmers could not derive the desired benefit from the existing National Agricultural Insurance Scheme (NAIS). The farmers bear the risk on both the production and price fronts, but the NAIS provides relief in the case of yield fluctuations only.

Mr. Singh said the FIIP would target both the critical components of the farmer's income such as yield and price through a single policy instrument. The pilot project is being taken up during the rabi 2003-04 season in 18 districts of 16 States for wheat and rice.

The districts in which wheat will be taken up under the pilot project are Buxar in Bihar, Banaskantha in Gujarat, Rewari in Haryana, Hamirpur in Himachal Pradesh, Jammu in Jammu and Kashmir, Hazaribagh in Jharkhand, Parbhani in Maharashtra, Sangrur in Punjab, Mirzapur, Faizabad and Mathura in Uttar Pradesh and Udham Singh Nagar in Uttaranchal.

The districts in which paddy will be taken up are Warangal in Andhra Pradesh, Kamrup in Assam, Mysore in Karnataka, Cuttack in Orissa, Madurai in Tamil Nadu and Bardwan in West Bengal.

Under the programme, a farmer's production and price risk for the crop produced would be protected by ensuring the minimum guaranteed income, determined by using the average yield of the last seven years and the MSP. If the actual income falls short of the guaranteed income, the farmer would be eligible for compensation to the extent of indemnity from the Agricultural Insurance Company. An area approach as in the NAIS would be used for actual yield and price measurement of the insured crop. A premium subsidy of 75 per cent is proposed to be given in case of small and marginal farmers and 50 per cent for other farmers. The Centre will bear the entire subsidy for the pilot project.

Responding to the suggestions and observations made at the meeting, Mr Singh said the programme would be fine tuned on the basis of the outcome of the pilot project before it is extended to other States and crops.