Risk Management - Report of the Committee on Doubling Farmers' Income

Risk is a term that typically refers to the probability of an endangering act or event. It is closely associated with damage or loss, physical or financial. Therefore, there is need for strategies that will build resilience to recover from challenges resulting from force majeure events, as well as to counter the risks that result from man-made actions. Insurance is the major approach used for risk transfer which involves the contractual shifting of a pure risk from one party to another. Also forewarning about an inclement eventuality can minimise the impact of such events.

Risk mitigation normally requires thought on both financial cover and physical actions.

However, the capacity to take on risk, head-on, is limited due to the fear of the unknown and also because of structural weaknesses in the system. Reforms and interventions in the agricultural value system are needed so as to build resilience in the farmers, and to build their capacity to take on risks that are more intrinsically liked with their markets. Technology is emerging as a powerful tool to deploy forecast, early warning, alerts and the like, and help farmers to be well prepared. It can be gainfully utilised in agriculture across its multiple sub- sectors for the farmers & other stakeholders to be informed in advance, and take appropriate actions that will help in mitigating the risk impact, and secure output and income.

Climate related Risks

Climate change impacts are becoming more apparent over the last decade or so, and the natural resource endowments are also being impacted due to demographic shifts. This necessitates revisiting and re-categorisation of the existing agro-ecological zones of the country, which were last attempted fifteen years ago by ICAR.

Responsibility: DARE, ICAR Timeline: Long term

Refer Volume: V 2

Prepare judicious land use planning based on re-categorised local agro-climatic as well as techno-economic potentials specific for each region, as the lands and locations are not equally suitable for same kind of crops. This will help provide fresh direction on all other sustainable strategies and practices.

Responsibility: DARE, ICAR Timeline: Long term

Refer Volume: V 3

Prepare perspective plan for treating the degraded lands following the concept of participatory watershed management after prioritising the issues and vulnerable areas. This may include studying the long-term implications of changing land use patterns. This will help mitigate risk in vulnerable areas.

Responsibility: DoLR, DAC&FW, DoRD, NRAA Timeline: Short & Long terms

Refer Volume: V

Krishi Vigyan Kendra (KVKs) and Extension Agencies must adopt the 29 number of double stressed districts (refer Chapter 5, Volume I) and design special programmes to support these districts.

The programmes must be implemented in coalition with state agencies and line departments to create favourable and facilitating environment to trigger the path of doubling of farmers’

income.

Responsibility: DAC&FW, DAHDF, ICAR, DoRD Timeline: Short term

Refer Volume: I 5

Adopt new agronomy like adjustment of planting dates to minimize the effect of high temperature increase-induced effects.

Responsibility: DAC&FW, ICAR Timeline: Short term

Refer Volume: V 6

Develop contingency crop planning, keeping in view occurrence of extreme weather events and water availability in a region for various crops/ livestock. Promote perennial tree (orchards, timber, bamboo etc.) based farming systems for additional income and assurance against climate anomalies.

Responsibility: DAC&FW, ICAR, MoEFCC Timeline: Short term

Refer Volume: V &VI 7

Monitor and forecast climatic extremes by creating virtual weather stations at micro-level;

adopting Weather index based crop insurance; Value-added weather management services (include delineation of climate vulnerable zones at micro-level, real time agromet-advisories, climate predictions and pest & disease forewarning systems).

Responsibility: IMD Timeline: Short term Refer Volume: VI 8

Ensure capacity building for disaster management planning at the local level preparedness planning, vulnerability mapping while preparing the community level drought management plans, in livestock and dairy sectors, agromet-advisory services etc.

Responsibility: MoEFCC, IMD, NDMA, ICAR, DAC&FW Timeline: Short term

Refer Volume: VI 9

The ‘Varun Mitra’ project in Karnataka, has demonstrated specific benefits to farmers receiving the meteorological advisory services. A study conducted on the impact of forecast technology generated date and its use by the farmers, has brought out that risk negotiation

was better and helped in reducing the losses relating to natural calamities and earn better profits as a result. This model may be suitably adopted by other States.

Responsibility: DAC&FW, IMD, ICAR Timeline: Short term

Refer Volume: X 10

Develop convergence of national/state programmes/schemes for drought proofing at micro- level. As many as 151 districts have been identified as most vulnerable based on Vulnerable Assessment Studies by ICAR.

A roadmap for these districts may be prepared for time bound drought proofing of all these in a time-bound manner. This will make interventions holistic and add efficiency to government resources.

Responsibility: DAC&FW, DAHDF, ICAR, NRAA Timeline: Short & Long terms

Refer Volume: VI 11

Based on IPCC’s AR 4 parameters, 151 districts have been identified as highly vulnerable.

However, based on the new parameters of vulnerability identified by IPCC, the number of highly/critically vulnerable districts in the country may go up. These additional districts will also have to be brought under the purview of drought proofing action plan of NRAA.

Responsibility: ICAR, DAC&FW Timeline: Long term

Refer Volume: XIII 12

Improve the density of weather monitoring stations (humidity, barometric pressure, temperature), including at Gram Panchayat level. This can be allocated to Farmer Friends (under ATMA) at each village or done through private entrepreneurs. At each of the proposed Gramin Agricultural Markets (GrAM) centres also weather recording instruments and alert mechanism may be installed.

Responsibility: MoES, MoEFCC, DAC&FW Timeline: Long term

Refer Volume: X 13

To manage weather related risks, spatially and temporally differentiated weather forecast of key phenomena with a 3 week lead-time can be further refined. Such information should also be directly communicated to State extension offices, with designated key triggers to activate pre-emptive contingency actions at district and block level.

Responsibility: MoES, MoEFCC, DAC&FW Timeline: Short term

Refer Volume: X 14

Historic data on climate and weather can be linked to each GrAM (Gramin Agri-Market) by way of kiosks. This will facilitate on-demand access and evaluation at farmers’ assembly

centres at village level. Using interactive telephony need to be widely adopted, in the language a farmer can comprehend, to make weather advisories readily accessible to farmers.

Responsibility: IMD, DAC&FW Timeline: Short term

Refer Volume: X 15

Long term climate shifts should be disseminated with the dynamic or expected variations in boundaries climatic zones, so that scientists can apply the information to build relevant crop plans and crop varieties & technologies for focus regions.

Responsibility: MoES, MoEFCC, DAC&FW Timeline: Short term

Refer Volume: X

Production, Marketing and Price related Risks

Risks to the biological set of activities stem from the dependence on weather based events.

Irrigation and effective water management systems, especially in rainfed areas, form an important component of risk management. Greater focus on strategic development of irrigation facilities for most vulnerable farmers is necessary. This includes water harvesting through the small and micro-irrigation systems, as a source of protective irrigation at critical stage(s) of crop growth in the event of deviation in rainfall. Further, water use efficiency through adoption of micro-irrigation systems and crop alignment in tune with agro-climatic condition and availability of water are important.

Responsibility: DAC&FW, DoRD, MoWR, ICAR Timeline: Long term

Refer Volume: X 17

Greater emphasis is required on developing varieties of crops and breed of animals/fish that are tolerant to various stresses relating to temperature, water and salinity levels. The agricultural R&D community may take on crop and region differentiated development to avoid duplication of efforts.

Responsibility: ICAR, DAC&FW, DAHDF Timeline: Long term

Refer Volume: X 18

There is urgent need to bridge the gap in time taken and affordability, between lab and land.

Technologies developed should be appropriately communicated to maximum number of farmers. One of the important factors, that can impact the level of adoption of new technology, is its ability to bring monetary gains to the farmers.

Responsibility: DAC&FW, DAHDF, ICAR Timeline: Short term

Refer Volume: X 19

Adopt good agricultural practices like diversified cropping systems, conservation agriculture for carbon sequestration, water saving technologies, organic farming and integrated farming

systems, and afforestation to minimise human-induced risks in agriculture. Watershed based management of resources is a comprehensive and scientific approach to risk management.

Responsibility: DAC&FW, ICAR Timeline: Short term

Refer Volume: X 20

Build the concept of National Seed Reserve (NSR) for making seed available to the farmers at the time of re-sowing during risks. This would serve well in case of contingent situations.

In order to incentivise the states to promote NSR, the losses, that may be suffered on reserves when not used as seeds should be compensated. A sinking fund/corpus fund may be created to meet such demands.

Responsibility: DAC&FW, ICAR Timeline: Short term

Refer Volume: X 21

Market risks mainly arise from market unpredictability and fluctuations. Hence, the critical intervention needed is to strengthen opportunities for optimal monetisation, comprising robust agri-logistics (storage & transportation), processing and value addition and, efficient marketing. The new market architecture described by retail agricultural markets (GrAMs), facilitative export markets and reformed wholesale markets (APMCs) would also help in normalising the wide fluctuations that the markets are exposed to.

For details Volumes III & IV may be referred to.

Responsibility: DAC&FW, DAHDF, DoRD Timeline: Short term

Refer Volume: III, IV, X 22

Since agriculture markets cannot be perfect always, and will experience price volatility, a robust procurement mechanism based on notified MSPs will be necessary. In case of commodities for which MSPs are not notified, price support system under the ‘Market Intervention Scheme (MIS)’ should be deployed efficiently.

Responsibility: DAC&FW, DoPD Timeline: Short term

Refer Volume: IV 23

An important price risk management tool is adoption of contract farming, where under pre- production price-agreements are contracted by the farmers with the sponsoring company.

The States and UTs should be motivated and supported to adopt the Model Contract Farming and Services Act, 2018. The states thereafter should take all steps to popularise the adoption of contract farming as a price risk negotiator

Responsibility: DAC&FW, DAHDF, ICAR, MoRD Timeline: Short term

Refer Volume: IV, XII

Restructure the Directorate of Marketing & Inspection to take onus for market intelligence as the Directorate of Marketing and Intelligence. The mandate should be to provide technology backup to the institutional mechanism, to be set up for demand and price forecasting. A robust price and demand forecasting system should help the farmers in making a rational and market- led production decision prior to the sowing/planting seasons.

Responsibility: DAC&FW Timeline: Short term Refer Volume: XIII

Insurance – crop and livestock

Timely implementation of crop insurance scheme is necessary and states should not seek extensions to cut-off dates for buying insurance. States should promote availing of crop insurance facility without waiting for completion of sowing. Policy enrolment cut-off dates can also be adjusted and kept flexible to suit cropping patterns and regional agro-climatic conditions. Similarly, release of claims can be adjusted to suit payment closure before next sowing season.

Responsibility: DAC&FW Timeline: Short term Refer Volume: X 26

Dedicated budget at state level should be created to avoid delays linked with premium subsidy, since some states are found to be faltering in timely release of premium subsidy, affecting both timely payment of claims and the solvency of insurers.

Responsibility: DAC&FW Timeline: Short term Refer Volume: X 27

Price discovery for crop insurance should consider adopting longer duration so as to benefit from more competitive rates and support farmers with lower insurance prices. The government or the National Technical Support Unit (NTSU) should issue detailed guidelines, to help stabilise insurance prices.

Responsibility: DAC&FW Timeline: Short term Refer Volume: X 28

Deploy technology for real time data on various parameters on a larger/universal scale, its transmission and computation with accuracy, interpretation and dissemination as an Advisory in quick speed. This can, therefore, become a powerful tool in the hands of the farmers to take rational decisions relating to production based on forecast-stimulus, precautions in response to ‘Alerts and Early warning’ etc.

Responsibility: DAC&FW & DARE Timeline: Short term

Refer Volume: X

To resolve matters such as “Area Correction Factor” and time bound assessment and payment of insurance, technology such as digitising of land record on a GIS platform is recommended.

Verification of actual sown individual insured land parcels can be done by taking high resolution impages of crops through Remote Sensing technology / Drones before harvest and superimposing on digitised land parcels to identify the mismatch. Land record digitisation will spawn multiple advantages beyond Pradhan Mantri Fasal Bima Yojana (PMFBY).

Responsibility: DAC&FW Timeline: Short term Refer Volume: X 30

In order to enhance the penetration of PMFBY (Pradhan Mantri Fasal Bima Yojana) and make it more productive, efforts are needed to cover non-loanee farmers; as also notify larger number of crops for coverage. Efforts should be made to ease access to insurance by non- loanee farmers. All these changes/initiatives are needed to cover the risks of larger number of farmers, as also to increase the volume of business and drive down premium rates.

Involving at least three insurers in a given district to service non-loanee farmers is suggested.

Suitable checks and balances, including portal based enrolment and centralised database, will mitigate apprehensions of duplicated insurance on same crop. Change Agents can be appointed to spread greater awareness and facilitate insurance uptake by farmers and as part of an insurance feedback mechanism.

Responsibility: DAC&FW Timeline: Short term Refer Volume: X 31

The perception among the farmers that the insurance companies are garnering undue profits at their cost, needs correction for their sustained interest in a market-driven scheme like PMFBY. It is hence suggested, that a system be adopted whereby a certain percentage of the windfall gain made by the insurance agencies during normal years is utilised to offset particularly the premium payments made by the farmers. It is further suggested, that this can be sustained if the insurance agencies create a Corpus Fund for depositing small percentages of their annual profits on yearly basis.

Responsibility: DAC&FW, NABARD Timeline: Short term

Refer Volume: X 32

In order to increase coverage of non-loanee farmers, state governments may promote more than one insurance agency at the district level. It may also be considered to assign work order to L2 & L3 at L1 rates. These assignees can be tasked to enrol non-loanee farmers.

Responsibility: DAC&FW Timeline: Short term Refer Volume: X

All states should be encouraged to undertake a drive to identify and enrol tenant farmers, if necessary with adequate financial support to finance the premium, and they should resort to legal remedies to recognise sharecroppers, lessees etc.

Responsibility: NITI Aayog, DAC&FW Timeline: Short term

Refer Volume: X 34

The proposed Model Land Cultivators License Act should be brought out by NITI Aayog at the earliest, so that the states/UTs can legislate appropriately. In the alternate the Model Land Lease Act already rolled out by NITI Aayog may be amended to include the intended provisions of the Land Cultivators License Act.

The amended Model Land Lease Act may to cater to the credit eligibility of such a category of lessees, sharecroppers etc. and who by virtue of a loan sanction get automatically covered under PMFBY.

Responsibility: NITI Aayog, DAC&FW Timeline: Short term

Refer Volume: X 35

Create awareness to promote insurance programmes which come with a ‘top-up’ cover for paying losses of ‘localised risks’, like hailstorm, landslide, inundation and post-harvest losses on individual farm basis. This may differentiate index to use ‘yield index’ for deciding losses of widespread calamities and ‘farm yield’ for assessing losses of localised perils / calamities.

Responsibility: DAC&FW Timeline: Short term Refer Volume: X 36

Since PMFBY is limited by the status of historical yield data which is not available in case of all crops, it would be necessary to develop and move towards weather based insurance viz yield based insurance as in RWCIS (Restructured Weather Based Crop Insurance Scheme).

In order to promote this scheme prerequisite infrastructure is universally spread Telemetric Weather Gauges (TWGs) etc. which can generate data on various parameters like temperature, relative humidity, wind speed and others, at fixed regular intervals. This entails roll out of a policy that would attract investments including from the private sector.

Responsibility: DAC&FW Timeline: Short term Refer Volume: X 37

Technology suit comprising remote sensing, drones, sensors, smart phones and computation would help in imparting greater creditability to the data on estimation of yield & loss among different stakeholders. This is essential for sustaining a market-driven scheme like PMFBY.

Responsibility: DAC&FW Timeline: Short term Refer Volume: X

Responsibility: DAC&FW Timeline: Short term Refer Volume: X 39

A technology suit comprising remote sensing, drones, sensors, smart phones and computation would help in imparting greater creditability to the data on estimation of yield & loss among different stakeholders. This is essential for sustaining a market-driven scheme like the PMFBY.

Responsibility: DAC&FW Timeline: Short term Refer Volume: X 40

Unified Package Insurance Scheme (UPIS) must be made robust as it offers various advantages, including welfare packages, which more appropriately cover the secondary risks that arise from primary crop failure.

Responsibility: DAC&FW Timeline: Short & Long terms Refer Volume: X

The “Livestock Insurance Scheme (LIS)”, though operational since 2004, has very poor penetration, covering only 7 per cent of eligible animal population. Greater efforts need to be made on promoting this scheme, on lines of the PMFBY. The scheme needs to support farmers to cope with economic losses from all kinds of livestock and can be made more robust, as a market led and farmer-friendly programme. Currently the support under the scheme is restricted to primarily cover death of the animal and not the risks that may arise from disability and other hazards.

Responsibility: DAHD Timeline: Short term Refer Volume: X 42

An online enrolment portal, like in case of PMFBY, should be developed for LIS so that livestock owners, including small ruminants’ owners also have easy access to LIS.

Responsibility: DAHDF, NIC Timeline: Short term

Refer Volume: X 43

Livestock insurance limited as it is in its coverage is as yet mostly confined to cattle, though

Dalam dokumen Report of the Committee on Doubling Farmers' Income (Halaman 156-170)