Cheer for cuppa: Coffee growers to be insured

Minister of state for commerce Jairam Ramesh said today that the Centre has approved a weather insurance scheme for coffee growers...

Minister of state for commerce Jairam Ramesh said today that the Centre has approved a weather insurance scheme for coffee growers, the first ever rainfall-linked insurance plan for a specific commodity. Speaking to reporters here, he said that the scheme, cleared by the Cabinet on Thursday, would cover 85,000 growers in Karnataka, Tamil Nadu and Kerala. “Based on our experience with this scheme, we will cover other plantation crops too,” he added.

The minister informed that to support small growers, the government has approved a sum of Rs 22.87 crore in the first year towards the subsidy component. State-run Coffee Board chairman G V Krishna Rau pointed out that the 50 per cent subsidy would be provided to small growers on the premium amount, subject to a ceiling of Rs 2,000 for robusta and Rs 2,500 for arabica per hectare. The insurance scheme is aimed at protecting coffee growers against anticipated shortfalls in yield arising from deviations in rainfall within a specific area and period. It will provide a payout against deficit rainfall in “blossom showers” and “backing showers” and excess rainfall during the Monsoon season.

Three different phases will be available under the scheme — blossom showers insurance, backing showers insurance and Monsoon rains insurance. A grower will have the freedom to choose any one, two or all three options. The premium will be worked out separately for each option. “The maximum sum assured is Rs 20,000 per hectare for robusta and Rs 30,000 per hectare for arabica,” Ramesh said. “Broadly speaking, this covers the production costs.” The insurance policies will be sold by Agriculture Insurance Company (AIC). The scheme will be available for robusta and arabica in all the coffee zones of Karnataka (23), Kerala (11) and Tamil Nadu (nine).

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AIC chief manager K N Rao said that the premiums charged for the insurance will vary across the type of coffee (arabica or robusta) and across different coffee zones — because of the difference in rainfall patterns, distribution and, therefore, risks.

“Coffee zones with a good chance of rainfall during blossom shower and backing shower periods will have a lower premium than coffee zones with less chance of good rainfall,” he informed.

Interest waiver for K’taka

BANGALORE: Banks are set to implement the Rs 168 crore relief package announced by Prime Minister Manmohan Singh for coffee growers in Karnataka, minister of state for commerce Jairam Ramesh has said. The Prime Minister had announced on September 29, 2006, a waiver for the districts of Andhra Pradesh, Maharashtra, Karnataka and Kerala where cases of farmers’ suicides had been reported. Ramesh said that the state-run Coffee Board will implement the package in the three districts of Hassan, Kodagu and Chikmagalur. All accumulated interest on loans taken by coffee growers as on July 1, 2006, will be waived. The Board estimates this interest amount to be Rs 168 crore, which will be borne equally by the Central and state governments. The repayment period for the principal amount would be rescheduled to give growers three to five years for repayment, in addition to a one-year moratorium. — PTI

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