Eight years after govt introduced agriculture insurance, only a few farmers know about it

Although the number of agriculture and livestock insurance holders is increasing, it is far less than what was expected when the program was introduced.

Ripe paddy inundated by unseasonal heavy rainfall in Kailali district. (Photo: Pratap Tharu)

Prasun Sangroula

  • Read Time 3 min.

Kathmandu: Around this time every year, Ram Prasad, a 70-year-old farmer from Kailali district, would be busy in the fields, harvesting crops, especially paddy.

But this year, just when it was time to harvest the crop, a tragedy struck. An unseasonal rain destroyed his crops.

“The rain ruined my hard work,” says Ram Prasad, who is a full-time farmer. “It destroyed my crops cultivated in 4.18 acres [2.5 bigha] of land. This has spelled trouble for my future.”

Ram Prasad’s case is not unique. Last week’s post-monsoon rain has ruined crops across Nepal. 

Another farmer, Bishu Chaudhary, 50, also from Kailali district, said he is frustrated as the rain ruined all his crops cultivated in seven Bighas of land.

According to the Directorate of Agriculture Development, the rain-triggered disasters have affected 7.29 percent of the total paddy production in the country.

This year, paddy, one of Nepal’s staple crops, was planted in a total of 13,42,819 hectares of land, of which ​​184,200 hectares got inundated till Tuesday, October 19.

Every year during the monsoon season, heavy rainfall affects agriculture and livestock farming in Nepal. But the scale of the menace this year has been devastating.

In a bid to cover the damages and losses to agriculture, Nepal government introduced the Agriculture and Livestock Insurance program in the fiscal year 2013/2014.

In the initial phase, the government provided a 50 percent subsidy in the premium of the insurance. The premium was later increased to 75 percent, and currently it is 80 percent.

The rice is seen germinating after a paddy field was submerged by the sudden heavy downpour. (Photo: Pratap Tharu)

Even though the government bears 80 percent premium, only a handful are benefited from the insurance program. In a country of about 30 million where over 60 percent of the population is directly or indirectly dependent on agriculture for livelihood, the insurance program has only benefited less than 200,000 farmers.

In a country of about 30 million where over 60 percent of the population is directly or indirectly dependent on agriculture for livelihood, the insurance program has only benefited less than 200,000 farmers. 

Farmers have little or no awareness about the program, owing to sketchy communication on the government’s part.

Prasad and Chaudhary both are unaware of the insurance facility. Both of them say they have never been informed and learned about the insurance facility.  

“We would have done the insurance if we were informed and aware about it,” says Chaudhary. 

These two farmers are just representational figures, many like them don’t know that even agriculture and livestock insurance exist. 

According to data from the Department of Agriculture, in the fiscal year 2020/21, a total of 179,216 agriculture and livestock insurance was registered, of which 4,945 are crops insurance. In the fiscal year 2019/20, a total of 3,497 crop insurance were recorded and in the next fiscal year, the number increased to 3,811.

According to the Food and Agriculture Organization, 66 percent of the Nepali population is directly engaged in agriculture which means over 19 million Nepali population are farmers.

Paddy fields are inundated following heavy rainfall in Kailali district. (Photo: Pratap Tharu)

“Although the number of agriculture and livestock insurance holders is increasing it is not up to what we expected,” Senior Agriculture Extension Officer at DOA Shiva Sundar Ghimire told Nepal Live Today.

Ghimire said there are three main reasons behind it. Firstly, lack of awareness and promotion, secondly, the inability of insurance companies to function actively, and lastly less access to insurance companies in far-flung areas.

Currently, 20 different insurance companies provide the facility of insurance on agriculture and livestock. And to make their operations effective, their working districts have been delineated. For instance, Nepal Insurance Company must look after four different districts that include Darchula, Baitadi, Dadheldura, and Kanchanpur. They can also look after other districts if they wish but their major priority should be on those four districts.

“We are working on various plans and projects to increase the number of insurance holders on agriculture and livestock,” said Ghimire. “Very soon we will come up with awareness and promotion programs.” 

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