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Crop insurance was introduced by the government of India in 1985. It is operated through the General Insurance Corporation of the State Government. The Government of India in co-ordination with the General Insurance Corporation of India (GIC), had introduced a scheme called the National Agricultural Insurance Scheme from Rabi-1999-2000 season. The main objectives of the crop insurance are:
(i) to provide financial support to farmers in the event of crop failure on account of natural calamities,
(ii) to enable farmers affected by a crop failure to restore their eligibility for fresh borrowing from the institutional credit institutions,
(iii) to protect farmers against losses suffered by them due to crop failure on account of natural calamities, such as drought, flood, hailstorm, cyclone, fire, pest/diseases,
(iv) to stimulate production of cereals, pulses and oilseeds.
The sum insured is 100 per cent of the crop loan or a maximum of Rs. 10,000 per farmer. The insurance premium is 2 per cent of the sum insured for rice, wheat, and millets and 1 per cent for pulses, and oil seeds which is deducted at the time of disbursement of the loan. Small and marginal farmers pay only 50 per cent of the insurance premium, the balance is paid as subsidy by the Centre and the States. The crop insurance policy has however, not paid much dividends to the marginal, small, and medium farmers.
Technological Factors Moderisation of agriculture requires appropriate machiney for ensur ing timely field operations, effective application of agricultural inputs and reducing drudgery in agriculture. Traditionally, farmers in Inia have been using manual and animal operated farm equipment but due to increased cropping intensity, this power is no longer adequate to ensure timeliness. The research institutions and industries together have helped the farmers in development suitable farm machinery to mechanised field operations. The farm mechanisation increases cropping intensity, timely operations increases crop productivity and profitability. Technological factors include HYVs, chemical fertilisers, insecticides and pesticides tractors and other agricultural machinery. The use and availability of these inputs also enhance the agricultural productivity of a region.