In a significant move benefiting farmers, the Madhya Pradesh Cabinet, led by Chief Minister Mohan Yadav, has greenlit the continuation of the Pradhan Mantri Fasal Bima Yojana for the next five years with a substantial budget of Rs 11,608.47 crore.
This decision aims to offer crucial support to millions of farmers in the state, safeguarding them against crop losses caused by natural disasters. Madhya Pradesh has been a frontrunner in effectively executing the scheme since 2016, leveraging advanced technology for crop evaluation and yield estimation.
The state has witnessed commendable success under the program, with claims amounting to Rs 961.68 crore paid to 35.18 lakh farmers in 2023-24, and Rs 275.86 crore disbursed to 35.56 lakh beneficiaries in 2024-25. These figures underscore the scheme’s extensive reach and its pivotal role in agricultural risk management.
Under the Pradhan Mantri Fasal Bima Yojana, farmers contribute a minimal premium, set at 2% for Kharif crops, 1.5% for Rabi crops, and 5% for commercial and horticultural crops, with the remaining premium shared between the Central and State governments.
The state has maintained the indemnity level at 80% for all crops, a measure that will persist in the forthcoming years. The Cabinet has left open the option to adopt one of two alternative implementation models, the Cup and Surplus Sharing 80-110 Model or the Cup and Cap Surplus Sharing 60-130 Model, with the final selection based on a thorough evaluation of their advantages.
Insurance companies play a significant role in both models, bearing a substantial portion of claims, while any surplus resulting from lower claims is reimbursed to the governments. Currently, the scheme operates through 11 clusters across the state, with insurance companies chosen through competitive bidding.
Madhya Pradesh is extensively utilizing satellite-based remote sensing technology, weather data systems, and modern data management frameworks for transparent and precise yield assessment, in collaboration with the National Remote Sensing Centre (Indian Space Research Organisation), Madhya Pradesh Council of Science and Technology, and Madhya Pradesh State Electronics Corporation.
Chief Minister Mohan Yadav emphasized that this five-year extension underscores the government’s unwavering dedication to stabilizing farmers’ income and mitigating their financial risks. The decision is poised to benefit small and marginal farmers throughout Madhya Pradesh by ensuring prompt and adequate compensation in the event of crop failure.
