CNI News
21 May 2024
Insuring one percent on one acre loan for rainy season agricultural cost would be implemented starting from 1st June and the insurance system could lead to controversy, said farmers.
Myanma Agricultural Development Bank has designated to lend farmers 150,000 kyats per acre and climate index based crop insurance system would be used so that when farmers could not repay loans as natural disaster hurt farms, the bank could compensate it, reportedly.
When the crops were damaged due to bad weather, because controversies could arise in compensation, decision-making bodies needed to be impartial, U Thein Aung, chairman of the Farmers Development Association, told CNI News.
" If the decision was made based on inches of rainfall one year round, rainfall inches within July for example were more than normal, but rainfall inches within one year is not too much different. In the situation like this, how will the decision be made? Although one percent is not a big amount, as the whole country, it can be a big amount. In fact, I don't know about it thoroughly. But what I have understood is that the system could lead to controversy. The organizations that will make a decision need to be impartial." he said.
While farmers were drawing loans
Instead of crop insurance system, it would be beneficial if the government subsidized the farmers whose farms were damaged due to natural disaster or it gave another loan, which were included in the law imposed to protect and promote the interests of farmers, said farmers.
He was worried that the system would work only for the interests of the insurance companies, rather than protecting farmers from a lot of losses, added U Thein Aung.
“Law for the Protection and Promotion of Farmers' Interests was imposed on 8th October, 2013 to make the State subsidize the farmers whose farms were damaged due to the natural disaster. It would be enough if the amount of loan the same as that of the crop insurance system, 150,000 kyats per acre, was lent to the farmers whose farms were really damaged due to the natural disaster. I'm worried that the system will work for the interests of insurance companies rather than protecting farmers from a lot of losses." he said.
While seeing farmers
Farmers had not known about the crop insurance system thoroughly as yet and it was necessary to be a system that farmers agreed and accepted, U Soe Khine, a farmer from Ayeyarwady Region, told CNI News.
" According to the crop insurance system, if 150,000 kyats per acre was lent, must farmers pay 1,500 kyats for crop insurance? How much will they pay for an acre of land drowned? In any case, if a farmer insures his farms, it will be better if he accepts or relies on that. We don't want that every farmer must insure." he said.
Myanmar Insurance Enterprise and Myanma Agricultural Development Bank cooperated and carried out a weather index based crop insurance system in Yangon, Bago and Ayeyarwady Regions as a pilot project when agricultural loans were issued for the cold season.
The current weather based crop insurance system would be carried out in the entire country reportedly.
