The Agriculture and Livestock Minister plans to initiate a crop and livestock damage compensation insurance scheme starting next year The minister made this proposal today while presenting the action report on the National Assembly’s previous resolution regarding a crop and livestock damage compensation trust fund. The proposed scheme approved by the parliament is expected to ensure food security and self-sufficiency through enhanced agricultural productivity.
In the last session in June this year, the National Assembly passed a motion to establish either a crop and livestock compensation trust fund or an insurance scheme to support farmers facing crop and livestock losses due to climate change and wildlife depredation.
Presenting a report on the motion today, the minister said the ministry prefers an insurance scheme over a trust fund as it provides better financial protection for farmers and ensures timely compensation, among others. In contrast, the report says, a trust fund can run out of money and doesn’t push farmers to manage risks effectively.
“If we establish only a trust or an endowment fund, it will not be sustainable. We can either combine the two or establish the insurance scheme for sustainability,” said Younten Phuntsho, Agriculture and Livestock Minister.
While the majority of members supported the establishment of an insurance scheme, several members raised concerns about it.
“If the insurance scheme is established and fails to benefit farmers, it will be useless. Given the high premiums for insurance, will farmers be able to afford it?” questioned Kamal Bahadur Gurung, Kilkhorthang-Mendrelgang MP, Tsirang.
“Considering the lack of support from the finance ministry in previous years, how are they going to assist this time? What percentage of the insurance costs will be covered by the government?” questioned Tashi Tenzin, Radhi-Sakteng MP, Trashigang.
“For any scheme to succeed, it is essential that all components are discussed with the farmers themselves,” said Tashi Dorji, Nubi-Tangsibji MP, Trongsa.
Some members recommended implementing both mechanisms to maximise benefits for farmers.
“While some farmers are thriving in agriculture, many are struggling. I believe the insurance scheme will only benefit those who can afford the premiums, whereas the trust fund will support those who cannot pay the insurance,” said Kuenga, Nyisho-Sephu MP, Wangdue Phodrang.
The Ministry of Agriculture and Livestock plans to initiate the scheme next year.
Although the erstwhile Agriculture and Forest Ministry initiated the introduction of the National Crop and Livestock Compensation Scheme in 2016, it could not be implemented due to a limited budget.
Similarly, the ministry also submitted the proposal on crop and livestock insurance in 2021 to the cabinet, after which it was reverted to the Ministry of Finance for review.
The proposal was also not recommended by the Ministry of Finance, considering the financial implications to the government and due to the lack of clarity in the administration of the scheme, which appeared to be complicated.
Deki Lhazom
Edited by Sonam Pem
