Business Daily from THE HINDU group of publications
Wednesday, Nov 05, 2008
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Business Daily from THE HINDU group of publications Wednesday, Nov 05, 2008 ePaper | Mobile/PDA Version | Audio | Blogs |
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Agri-Biz & Commodities
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Plantations Web Extras - Events Meet on crop insurance for plantations today G. Srinivasan New Delhi, Nov. 4 A crucial meeting of the Group of Ministers (GoM) headed by the Union Agriculture Minister, Mr Sharad Pawar, is being held here on Wednesday to resolve the long-standing and contentious issue of subsidy sharing between the Central Government and the States implementing the proposed Rs 729-crore crop insurance scheme for the plantation industry. The proposal covers coffee, tea, rubber, tobacco, chilli, ginger, turmeric, pepper, cardamom and flowers. Official sources told Business Line here that the crop insurance scheme for the plantation industry, originally proposed by the Task Force to the GoM in April 2007, was put before the Cabinet Committee on Economic Affairs (CCEA) in March this year. The CCEA directed the GoM to look into the issue of subsidy-sharing by the Central and State governments, keeping in view the pattern in other such schemes. Other members of the GoM include Union Ministers of Commerce, Finance, Defence, Overseas Indian Affairs and Parliamentary Affairs, besides the Minister of Labour and Employment (Independent Charge), Mr Oscar Fernandez, and the Minister of State for Commerce and Power, Mr Jairam Ramesh. The scheme would cover growers with landholding up to 10 hectares. But in case of tea and cardamom, growers with land holdings between 10 and 50 hectares would also be covered. The growers owning land holdings up to 10 hectares would be provided 50 per cent of subsidy on the insurance premium and those between 10 and 50 hectares would be provided 25 per cent subsidy. The sources said the area coverage would be 22.26 lakh hectares and funds required for subsidy is estimated at Rs 728.80 crore spread over five years. This entails budgetary support from the Government of India to the tune of Rs 499.55 crore in addition to utilisation of Price Stabilisation Fund Trust’s interest earnings on the Rs 500-crore corpus. When contacted, Mr Jairam Ramesh said he was for 100 per cent central funding for the proposed crop insurance scheme, since it is seen as replacement/substitute for Price Stabilisation Fund (PSF) scheme that is funded by the Central government outright. He said the Coffee Weather (Rainfall) insurance scheme, already in operation since April 2007, is fully funded by the Centre and plantation crops proposed to be covered under the scheme have enormous “potential” for foreign exchange earnings
Mr Ramesh said crops proposed under the insurance scheme are vastly grown in North-Eastern States and it would be fair to meet entire expenditure of subsidy from the Centre, while plantation crops proposed under the scheme are administered under Central Legislations. The sources further said that according to Section 64 VB of Insurance Act, the entire premium has to be deposited with the insurance company for commencement of the risk. Since there might be delay in getting the subsidy from the State Government, the operation of insurance policy might be delayed considerably, they said. More Stories on : Plantations | General Insurance | Plantations | Events
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