Lok Sabha Question No. 1503 (UNSTARRED), answered on 2025-07-29
Subject: Financial Relief Measures to Farmers prone to Weather Disruptions
Ministry: AGRICULTURE AND FARMERS WELFARE
Asked by: Shri P V Midhun Reddy

## GOVERNMENT OF INDIA MINISTRY OF AGRICULTURE AND FARMERS WELFARE DEPARTMENT OF AGRICULTURE AND FARMERS WELFARE

## LOK SABHA UNSTARRED QUESTION NO. 1503

TO BE ANSWERED ON 29 TH  JULY, 2025

## FINANCIAL RELIEF MEASURES TO FARMERS PRONE TO WEATHER DISRUPTIONS

1503. SHRI P V MIDHUN REDDY:

Will the Minister of AGRICULTURE AND FARMERS WELFARE कृ ͪष और ͩकसान कãयाण मंğी

be pleased to state: (a) the details of support mechanisms which are in place to assist farmers in avoiding their loans  from  becoming  NPAs,  especially  during  adverse  weather  conditions  affecting  crop yield; (b)  the  details  of  financial  relief,  restructuring  options  or  waivers  available  to  affected farmers; (c) whether there are any region-specific programs being implemented especially for States prone to weather disruptions like Andhra Pradesh; and

(d) if so, the details thereof?

## ANSWER

THE MINISTER OF STATE FOR AGRICULTURE AND FARMERS WELFARE कृ ͪष एवं ͩकसान कãयाण राÏय मंğी (SHRI RAMNATH THAKUR)

- (a)  to  (d):  The  Government  of  India  is  implementing  several  scheme  to  provide  financial assistance to farmers and to mitigate their financial risks including to protect them during periods of adverse weather conditions that impact crop yield, e.g. PM Kisan, PMFBY and MISS.  Details  of  some  of  the  major  initiatives  which  are  also  implemented  in  Andhra

Pradesh, are as under: 1. Under Modified Interest Subvention Scheme concessional interest rates on shortterm agricultural loans are provided to farmers through Kisan Credit Cards (KCC) for their working capital requirements. Under this scheme, farmers receive KCC loans at a subsidized interest rate of 7%.

To  facilitate  this,  an  up  front  interest  subvention  (IS)  of  1.5%  is  provided  to  financial institutions.  Additionally,  farmers  who  repay  their  loans  promptly  receive  a  3%  Prompt Repayment Incentive (PRI), effectively reducing the interest rate to 4% per annum.

To provide relief to the farmers on occurrence of natural calamities, the component of  interest  subvention  is  available  on  the  restructured  amount  to  banks  for  the  first  year and  such  restructured  loans  would  attract  normal  rate  of  interest  from  the  second  year onwards as per the policy laid down by RBI.

Interest  subvention  and  prompt  repayment  incentive  on  restructured  crop  loans  is also  given  to  farmers  affected  by  severe  natural  calamities  for  a  maximum  period  of  5 years  based  on  the  report  of  Inter-Ministerial  Central  Team  (IMCT)  for  grant  of  NDRF assistance and Sub-Committee of National Executive Committee (SC-NEC).

2. Pradhan Mantri Fasal Bima Yojana (PMFBY) :  As a support mechanism to assist the farmers, PMFBY provides for comprehensive risk insurance against crop damage from pre-sowing to post-harvest for crops and area notified by the concerned State Government . The scheme is voluntary for the States since inception and for all farmers w.e.f. Kharif 2020.

The  scheme  not  only  safeguards  against  wide  spread  yield  loss  due  to  nonpreventable  natural risks/ &  extreme  climate  calamities  viz.    flood,  inundation,  landslide, drought,  heat  waves,  hailstorm,  cyclone,  pests/diseases,    natural  fire  and    lightening, storm, typhoon, tempest, hurricane, tornado etc.  but also against farm level yield loss due to  localized  risks  (hailstorm,  landslide,  inundation,  cloud  burst  and  natural  fire)  and  post harvest  losses  due  to  cyclone,  cyclonic/unseasonal  rain  and  hailstorm  and    prevented sowing.  Under  this  crop  insurance  scheme,  farmers  are  provided  financial  protection against  crop  loss  due  to  natural  calamities.  In  case  of  crop  failure,  the  insurance compensates the loss, allowing farmers to meet their loan obligations and prevent NPAs.

To  provide  financial  support  to  farmers  at  the  time  of  losses  due  to  natural calamities, a yield index-based Pradhan Mantri Fasal Bima Yojana (PMFBY) and weather index based Restructured Weather Based Crop Insurance Scheme (RWBCIS) have been introduced  in  the  country  from  Kharif  2016  season.    It  is  a  demand  driven  scheme  and financial  liability  on  premium  subsidy  to  farmers  is  shared  by  the  Central  and  State Government on 50 : 50 basis and 90 : 10 in  North Eastern States & other Hilly states, with effect  from  Kharif  2020  season.  The  scheme  is  voluntary  for  the  States  since  inception and for all farmers w.e.f. Kharif 2020.

3. Pradhan  Mantri  Kisan  Samman  Nidhi  (PM-KISAN)The  Pradhan  Mantri  Kisan Samman Nidhi (PM-KISAN) is a Central Sector Scheme, launched in February 2019 by Hon'ble  Prime  Minister  of  India.  The  Scheme  aims  at  providing  financial  assistance  to farmer families with cultivable landholding, subject to certain exclusion criteria, to enable them  to  take  care  of  expenses  related  to  agriculture  and  allied  activities. Under  the Scheme, an amount of Rs. 6000/- per year is transferred in three 4-monthly installments of Rs.2000/- per farmer family. 4. Natural Calamity Relief: Farmers are also provided relief under National Disaster Relief  Funder  for  the  crop  loss  during  natural  disaster.  The  State  Governments  provide financial  relief  to  the  affected  people  in  the  wake  of  notified  disasters,  including  drought from  the  State  Disaster  Response  Fund  (SDRF),  already  placed  at  their  disposal. However,  in  the  event  of  disaster  of  a  severe  nature,  additional  financial  assistance  is extended  from  the  National  Disaster  Response  Fund  (NDRF),  as  per  the  laid  down procedure, which includes an assessment based on the visit of an Inter-Ministerial Central Team (IMCT). The financial assistance provided under SDRF and NDRF is by way of relief and not for compensation.

5. Loan Restructuring: In  the  event  of  natural  disasters,  the  Reserve  Bank  of  India (RBI) allows for restructuring of loans. Reserve Bank has issued Master Directions - Relief Measures by banks in areas affected by Natural Calamities 2018 dated October 17, 2018, separately to Scheduled Commercial Banks and to RRBs. As per the Master Directions, in the  event  of  natural  calamities  declared  by  the  State/Central  Government  all  short-term loans, except those which are overdue at the time of occurrence of natural calamity, shall be  eligible  for  restructuring.  Fresh  loans  can  also  be  sanctioned  by  banks  to  affected borrowers.  Agricultural  term  loan  installments  shall  also  be  rescheduled  keeping  in  view the repaying capacity of the borrower and the nature of natural calamity. This ensures that farmers are not unduly burdened during crop failure or damage due to natural calamities.

All  the  above  schemes  are  being  implemented  in  the  country  including  Andhra Pradesh  to  assist  farmers  during  adverse  weather  conditions  and  to  mitigate  their sufferings due to natural calamities affecting their crops.

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