This move addresses critical lapses by the previous Andhra Pradesh government under YS Jagan Mohan Reddy, which reportedly left farmers without insurance coverage for three years due to non-payment of the state's share.
Published Jul 30, 2025 | 5:57 PM ⚊ Updated Jul 30, 2025 | 5:57 PM
Andhra Pradesh’s failure to pay its PMFBY share from 2020 to 2023 deprived lakhs of farmers of compensation for crop losses, despite the farmers paying the premium. (Representational Pic/iStock)
Synopsis: Andhra Pradesh exited PMFBY in 2020, along with Telangana, Bihar, and West Bengal, citing high costs and administrative challenges. The Jagan government introduced a state-run crop insurance scheme but failed to deliver timely payouts, leaving farmers uncompensated amid bureaucratic delays.
The Union Government has revamped the Pradhan Mantri Fasal Bima Yojana (PMFBY), guaranteeing crop insurance for farmers, even if state governments fail to pay their share of the premium.
This reform addresses critical lapses by the previous Andhra Pradesh government under YS Jagan Mohan Reddy, which reportedly left farmers without insurance coverage for three years due to non-payment of the state’s share.
Union Agriculture Minister Shivraj Singh Chouhan, addressing the Lok Sabha on Tuesday, 29 July, revealed that Andhra Pradesh’s failure to pay its PMFBY share from 2020 to 2023 deprived lakhs of farmers of compensation for crop losses, despite the farmers paying the premium.
Launched in 2016 by the Modi government, PMFBY replaced the National Agricultural Insurance Scheme (NAIS). It mandates a 21-day claim settlement period post-crop loss, with premiums shared between the Centre and states to ensure affordability and broad coverage. However, Andhra Pradesh’s non-compliance during the specified period left farmers vulnerable.
Citing this as an “unfortunate precedent,” the Centre amended PMFBY rules to ensure that the farmers’ entitlements are no longer tied to state contributions. “The Centre will pay its premium share regardless of state defaults, so farmers aren’t penalised for government negligence,” Chouhan stated.
To enforce accountability, states failing to pay their share on time will face a 12 percent interest penalty on the owed amount, recoverable by the Centre. This balances timely payments with farmer protection.
Andhra Pradesh exited PMFBY in 2020, along with Telangana, Bihar, and West Bengal, citing high costs and administrative challenges. The Jagan government introduced a state-run crop insurance scheme but failed to deliver timely payouts, leaving farmers uncompensated amid bureaucratic delays. This sparked criticism from farmer unions and opposition parties, who accused the YSRCP of neglecting the agrarian community.
“The Modi government is dedicated to safeguarding our annadatas (food providers) and will not let state inaction or bureaucratic delays hinder their rights,” Chouhan said.
(Edited by Majnu Babu).
