Farmers in India's Punjab have been protesting against many of their agricultural woes. Photo: Wikimedia Commons

Severe debts, annual droughts, and suicides have plagued the Indian farming community. Prime Minister Narendra Modi’s party’s 2014 manifesto promised to boost the farming sector, but a report by the Comptroller and Auditor General (CAG) shows farm distress has only worsened in the last four years.

Rising discontent resulted in 100,000 farmers marching upon Parliament this year. The agrarian crisis in India, all too real and distressing, has been sustained by ruling parties’ political agendas. P Sainath, the founding editor of the People’s Archive of Rural India (PARI), has been stressing that the Prime Minister’s ‘Fasal Bima Yojana’ (crop insurance scheme) has benefited private insurers more than the farmers.

The distress in the sector, which employs over half of the Indian workforce, will play a crucial role in deciding the people’s mandate in this year’s general election as Modi seeks a second term in office.

Manifesto vs. reality

Among other promises, the Bharatiya Janata Party’s (BJP) 2014 election manifesto insisted on reining in inflation by setting up a Price Stabilization Fund and evolving a single National Agriculture Market. However in reality, the Modi Government, with all its power, has been unable to ease farmers’ suffering.

The National Commission on Farmers (NCF), constituted in 2004 under the chairmanship of Professor MS Swaminathan. published its final report in 2006. It focused on farmer distress and the rise in farmer suicides and strongly recommended a holistic national policy. To extreme consternation, no such policy has been implemented.

The Land Holding Survey, Report No. 399 of the 48th National Sample Survey (NSS) shows that 11.24% of Indian households are landless. In 1991-92, the share of the bottom half of the rural households in the total land ownership was only 3% and the top 10% owned 54% of the land.

The BJP’s 2014 manifesto declared, similar to the Swaminathan Committee report: “(The) BJP will adopt a ‘National Land Use Policy’, which will look at the scientific acquisition of non-cultivable land, and its development; protect the interest of farmers and keep in mind the food production goals and economic goals of the country. Its implementation would be monitored by the National Land Use Authority, which will work with the State Land Use Authorities to regulate and facilitate land management.” However, after four years of BJP rule, it seems that the manifesto’s main goal was to attract voters by cashing in on anti-incumbency sentiment.

Export-import disparities

Data accessed by Asia Times, via RTI, shows that exports for sunflower seeds, safflower or cottonseed oil and their fractions thereof only amounted to US$4.67 million for the fiscal year 2017-18. Compare this to imports during the same period,  US$1.84 billion. This is especially surprising when one considers that India’s rural spending is said to account for 55% of total national monthly expenditure.

Last year the government imposed import duty on edible oils even while domestic farmers could not get even the minimum support price (MSP) for oilseeds because farm-gate prices remained 15-25% lower than the MSP. This was completely counter to the recommendations of the Swaminathan report which recommended that the MSP should be at least 50% more than the weighted average cost of production.

CAG cover-up

Given the current state of the agriculture industry, questions arise over the suppression of the 89-page performance audit by the CAG [Report No.7 of 2017] on ‘Union Government’s Agriculture Crop Insurance Schemes’.

The crop insurance schemes were framed to provide insurance cover to the farming community against yield losses. These schemes were to be implemented in the states through the IAs (AIC and private insurance companies) and Bank/FIs operating in the respective States.

The CAG Report, observes that because of non-maintenance of the database of farmers, central and state governments were not in a position to ensure that 106 billion rupees released as premium subsidy reached the intended beneficiaries or achieved the intended purposes.

Furthermore, the auditor observes that the Rajasthan government, during the period of 2013-2016, issued notifications of crop insurance in selected districts in favor of different insurance companies. The condition was that the claims would be settled based on the crop area as reported. This was done despite knowing that the same does not include the “sowing failed down area” (area in which seeds do not grow for various reasons).

Due to the failure of crops in the four districts, the insurance companies, without the agreement of the state, reduced the sown areas of 389,000 farmers by 0.23 million hectares. This resulted in a loss of 312.7 million rupees to farmers’ insurance claims. In addition, these farmers also suffered a loss of 86.8 million rupees on account of additional premiums paid for “sowing failed down area” without any insurance coverage as the premium amount paid by the farmers was not refunded.

Audit Deficiencies

Further scrutiny of records revealed that ICICI Lombard General Insurance Company Limited obtained proposals from 21,875 non-loanee farmers in Rajasthan during Rabi (winter) season 2012-13 and collected premiums of 23.5 million rupees from the farmers. Subsequently, the Insurance Company rejected the proposal of 14,753 farmers due to the inadequacy of relevant documents and did not refund the premiums to these farmers. No action has been initiated by the state to get 14.6 million rupees in payments refunded to the affected farmers.

The implementing agencies are required to open a separate account for maintaining all transactions under the scheme. However, the audit noticed that the private insurance companies in Haryana and Maharashtra did not maintain any such accounts. The insurance companies stated (September 2016) that no such requirement was raised by state or central government.

Furthermore, the CAG report evoked NCIP guidelines, which stipulate that empaneled insurance companies are liable to be disqualified if their performance is found to be below par. But the audit found instances of inaction by the DAC&FW despite sub-par performances by insurance companies. For example, in Rajasthan, the performance of HDFC Ergo General Insurance Company Limited was declared by the state government to be below par for the last seven crop seasons up until the end of Kharif season 2014. However, the DAC&FW has not acted on the recommendation of the state government to disqualify the insurance company.

The audit examination reveals the chilling financial impact of selecting the wrong insurance companies. The CAG also acknowledges that the replies by the Rajasthan government on the controversial evaluation of bids by insurance companies were unacceptable according to scheme guidelines. This illustrates how the vast funds involved have been decentralized and handled by the BJP at the state level so that the central government can maintain its clean image before the relevant authorities.

The CAG report concludes: “The integrity of the data provided by the state governments in this respect and used by AIC was not ensured. There were delays in the issue of notifications, receipt of declarations from Bank/FIs within cut-off dates, receipt of yield data from state governments,  in the processing of claims by IAs, and irregularities in disbursement of claims by Bank/FIs to farmers’ accounts. There was no proper grievance redressal system and monitoring mechanism for speedy settlement of farmer’s complaints at GOI or state government levels.”

Even though huge funds under the schemes were provided to private insurance companies, the CAG expressed concern that there was no provision for the audit to ensure proper utilization of funds by these insurance companies. The CAG has only studied the impact of insurance schemes in a few selected states, and then for statistical audit scrutiny. Despite the selective data pool, the conclusion remains strong.

Though capping of premiums under the NCIP restricted the liability of governments under the schemes, the loanee farmers were deprived of the full benefits of insurance coverage they paid for. There was also a lack of awareness among the farmers as surveyed by the auditor.

Insurance companies appear to be exploiting the uneducated and uninformed farm laborers, and the plight of the Indian farmer has only been worsened by empty manifesto promises.

Asia Times Financial is now live. Linking accurate news, insightful analysis and local knowledge with the ATF China Bond 50 Index, the world's first benchmark cross sector Chinese Bond Indices. Read ATF now. 

Join the Conversation

99 Comments

  1. Amazing! This blog looks exactly like my old one! It’s on a totally different subject
    but it has pretty much the same page layout and design. Superb choice of colors!

  2. Nice post. I was checking continuously this blog and I am inspired!
    Very helpful info particularly the remaining phase :
    ) I maintain such info a lot. I was looking for this certain info for a very long
    time. Thank you and best of luck.

  3. When I initially commented I clicked the “Notify me when new comments are added” checkbox and now each
    time a comment is added I get three emails with the same comment.

    Is there any way you can remove me from that service?

    Thanks!

  4. You have a same attractive website. I like the occupied word that you equip with every article.

    You can check my website here : c anime apk

    What do you believe ?

  5. Greetings! I’ve been following your blog for a long time now and finally got the bravery to go ahead and give you a shout out from Huffman Tx!
    Just wanted to mention keep up the fantastic job!

  6. I am extremely impressed with your writing skills and also
    with the layout on your weblog. Is this a paid theme or did you modify it yourself?
    Anyway keep up the excellent quality writing, it’s rare to see a great blog like this one nowadays.

  7. With havin so much content and articles do you ever run into
    any problems of plagorism or copyright infringement? My
    site has a lot of exclusive content I’ve either created myself or outsourced but it
    appears a lot of it is popping it up all over the internet without my authorization.
    Do you know any ways to help prevent content from being ripped off?
    I’d genuinely appreciate it.

  8. Great blog here! Additionally your web site so much up very fast!
    What web host are you the usage of? Can I am getting your associate hyperlink to your host?
    I desire my web site loaded up as quickly as yours lol

  9. I like the valuable info you supply to your articles. I’ll bookmark your blog and check again here frequently. I am reasonably sure I will be informed lots of new stuff proper right here! Best of luck for the following!

  10. Utilizamos cookies propias y de terceros para mejorar nuestros Servicios y mostrarle publicidad relacionada con sus preferencias mediante el análisis de sus hábitos de navegación. Las cookies permiten a una página web, entre otras cosas, almacenar y recuperar información sobre los hábitos de navegación de un usuario de su equipo y, dependiendo de la información que contengan y de la forma en que utilice su equipo, pueden utilizarse para reconocer al usuario. Cookies técnicas: estrictamente necesarias para la prestación de determinados servicios solicitados expresamente por el usuario. Si se desactivan estas cookies, no garantizamos que pueda utilizar correctamente nuestros contenidos y servicios. Nuestro servicio técnico dispone de atención telefónica 24 h. para reparaciones de Urgencias y festivos.

  11. Hace unos seis años compre la cafetera modelo m-821 en Carretera del Mig, vuestra antigua fábrica de Hospitalet, y tengo un pequeño problema con ella, y es que cuando acabo de preparar un café, los posos del café no quedan compactos en el cacillo, sino que queda lleno de agua mezclada con los posos. Hola, Juan, deberás llegar la cafetera a uno de nuestros Servicios Técnicos , puesto que, probablemente, se haya averiado el termostato.

  12. Ayer a la hora de resetear el programa de lavado de mi lavavajillas de Bosch sin querer lo hice apretando los dos botones de reset y después al botón de power on/off, cuando debía hacerlo cuando al revés y se ha metido en unos menús un tanto raros que deben de ser menús para el servicio oficial técnico y ahora no abre la trampilla de la pastilla del detergente y tampoco echa abrillantador , es por lo cual que no se si de alguna manera se puede restablecer el programador al origen de fabrica.

  13. Le proporcionamos intervenciones en placas de cocinas vitrocerámicas, de inducción, estándar… Se realizan reparaciones en placas que ya no se fabrican y en elementos de nueva generación. No es caro adquirir asistencia profesional para la reparación de calderas de cualquier tipo, incluso las de nueva generación, como las de condensación. Ofrecemos servicios garantizados por un servicio técnico que asiste las 24 horas de los 3 5 días del año. Si desea un servicio técnico de calidad y con integrantes de verdad capacitados, contacte con nuestro equipo.

  14. Esta obra básica y sencilla, desarrolla las leyes que rigen en los líquidos y gases en función de la transferencia de calor, y que encuentran aplicación en las instalaciones de aire acondicionado. La obra progresa desde una explicación de principios básicos, pasando por una exposición de detalles de construcción y tipos de sistemas de aire acondicionado, hasta la instalación, localización de averías y reparación de estos sistemas.

  15. Importante empresa del sector salud requiere Bachiller y/ estudiantes Técnico y/ Tecnólogo en Archivística con experiencia mínima de 1 año en organización de archivos, elaboración y aplicación de tablas de retención documental TRD y tablas de valoración documental TVD. Importante Hospital pediátrico requiere Técnica Auxiliar de enfermería con experiencia en Cuidado integral de paciente pediátrico, administración de medicamentos y demás funciones pertinentes en pacientes pediátricos y neonatal.

  16. Ubicado en la principal vía de acceso a Guadalajara, en pleno corredor de Henares, y muy cerca del centro de la ciudad, la zona comercial, restaurantes y lugares de moda, TRYP Guadalajara Hotel es la mejor opción para descubrir Guadalajara y sus alrededores, gracias a sus completas y confortables instalaciones y a la calidad de sus servicios. Contamos con una amplia experiencia laboral avalada por nuestros clientes como expertos en el mundo de las Frigoríficos y gama blanca. También puedes llamarnos para preguntarnos por reparar gama blanca”, arreglar electrodomésticos línea blanca”. Todos los logos y marcas que aparecen en la web son propiedad de sus titulares y están protegidos por las leyes del Copyright, usados solo de manera informativa para la ayuda de nuestros SAT técnicos especializados en la reparación de los electrodomésticos pequeños electrodomésticos descritos de cada marca.

  17. Nos especializamos en el sector de la aeronáutica, fabricando piezas de mecanizado a medida para diversas aplicaciones en dicho sector. La empresa se reserva el derecho de modificar los contenidos del dominio web sin previo aviso. Mecanizados VR pone su tecnología al servicio de su empresa.

Leave a comment

Your email address will not be published. Required fields are marked *