Despite PMFBY, farmers hit by natural calamities often go without timely compensation. Discuss the structural reasons and suggest a better compensation framework.

The Pradhan Mantri Fasal Bima Yojana (PMFBY), launched in 2016, offers low-premium cover against crop loss from natural calamities. Yet the Standing Committee on Agriculture (2021) found that delays in settling claims defeat the very purpose of the scheme [2]. The causes lie in how the scheme delivers money, not in what it intends.

Structural reasons for delayed compensation

• Yield-data bottleneck: Payouts wait for States to finish crop-cutting experiments. The Committee traced slow settlement to late yield data and fund-transfer problems [1]. Large calamities that hit wide areas at once make this backlog worse.
• Inherited weakness: The CAG audit of earlier crop insurance schemes (2011-12 to 2015-16) found the same delays in State yield data and in insurers' claim processing [3]. PMFBY carried the fault forward rather than fixing it.
• Shrinking coverage: Bihar and West Bengal withdrew from the scheme and Punjab never implemented it [1]. Their farmers fall back on SDRF relief, whose norms leave out major relief items [4].
• Weak grievance redressal: The CAG flagged the absence of a grievance system [3]. The Committee was "disappointed" that no data on resolved complaints existed [2].
• Low insurer accountability: Penalties for late payment are weakly enforced, so delay costs insurers little [1].

Towards a better compensation framework

• Time-bound settlement: Fixed deadlines with automatic penalty interest on insurers and defaulting governments, as the Committee urged [1].
• Technology-led assessment: Satellite imagery, drones and smartphone-based crop-cutting to reduce reliance on manual yield data.
• Joint, rapid assessment: Extend the Home Affairs Committee's post-Ockhi model of a joint Centre–State preliminary assessment within a week [5] to crop loss.
• Two-stage payout: An on-account advance based on the area damaged, with the balance paid after final yield data.
• Safety net for uncovered farmers: Revise SDRF/NDRF norms and set up the separate Disaster Mitigation Fund [4].
• Transparent grievance tracking: A public dashboard of complaints filed and resolved [2].

PMFBY's design is sound, but slow data, State exits and weak accountability blunt its delivery. A time-bound, technology-driven and jointly assessed framework would turn crop insurance into real income security for farmers. That would advance SDG 2 (Zero Hunger) and show cooperative federalism working for farmers.