R Sedhuraman
Legal Correspondent
New Delhi, April 20
The crop insurance scheme meant for farmers is nothing but a sham as the affected people are unable to claim compensation for farm losses under the terms and conditions of the policy, the PIL petitioner on drought has informed the Supreme Court.
Arguing for the petitioner —NGO Swaraj Abhiyan, counsel Prashant Bhushan pleaded before a Bench comprising Justices MB Lokur and NV Ramana that farmers opting for crop insurance had to pay Rs 2,500 as premium for every hectare under cultivation.
Bhushan said under the compensation clause of the insurance policy, the affected farmers were entitled to a compensation of Rs25,000 per hectare. But this would be paid only if the shortage of rainfall was to the extent of 75 per cent which was improbable.
Even in the unlikely event of such a miserable failure of the monsoon, the hapless farmers would be paid the compensation only if the entire bloc of villages was affected, not just one or two villages. Every farmer took crop policies only to hedge his losses and that being so how the insurance companies were being allowed to link the compensation to the level of rainfall and farm output in a bloc of villages, he asked.
In case the farmers qualified for compensation by meeting the unreasonable conditions, the amount they would get is just about 50 per cent of the input costs estimated by the government at Rs40,000-45,000 for most of the crops.
Bhushan acknowledged that the government also paid a crop loss compensation of Rs13,500 for each hectare of irrigated land and Rs6,800 for un-irrigated land even if the farmers had no insurance. But the farmers stood to lose even if they got both compensations as the two together did not come close to the actual input cost, he said.
Farming had become an unprofitable proposition even in the best case scenario of monsoon bounty and bumper crop if one were to take into account the cost of labour. Almost all the family members of the community were engaged in the activity, the petitioner pointed out.
That was why farmers were doomed in the event of monsoon failure. This was borne out by the fact that 4,00,000 farmers had committed suicide in the past 15-20 years, Bhushan said yesterday.
In view of all this, the government should extend all welfare schemes such as employment under MNREGA, supply of foodgrains under the Food Security Act and other benefits under the National Disaster Management Act to the 12 states hit by drought in 2015. But the Centre had released just Rs 7,000 crore so far for implementing the employment guarantee scheme in 2016-17 against the lowest estimate of Rs 58,000 crore, half of which should have been made available by now under the MGNREGA Act, Bhushan said.
Arguing for the Centre, Additional Solicitor General PS Narasimha acknowledged that 33 crore people accounting for about 25 per cent of the country’s population had been hit by drought in 254 districts.
The Bench has slated the next hearing for April 26.