Modi announces 50 pc increase in compensation for distressed farmers

In a reprieve to farmers whose crops have been hit by recent unseasonal rain, Prime Minister Narendra Modi on Wednesday announced a 50 per cent increase in compensation and also eased criterion for providing financial relief.

The farmers can now seek financial help even if 33 per cent of their crop have been damaged as opposed to 50 per cent earlier.  “The amount of compensation has been increased  1.5 times. If a farmer was getting Rs 100 as compensation earlier, now he will get Rs 150. If it was Rs 1 lakh, he will get Rs 1.5 lakh...a 50 per cent increase,” Modi said, speaking at the Pradhan Mantri MUDRA Yojana.

The prime minister also asked banks to restructure loans of the affected farmers and instructed insurance companies to pro-actively settle their claims. Over 10 million hectares of crops have been damaged in northern India where dozens of farmers have committed suicide in recent weeks.

The cabinet ministers were asked to assess the damage following which Union minister Nitin Gadkari conducted a tour of rain-affected areas. Agriculture Minister Radha Mohan Singh said that about 113 lakh hectares of Rabi crop have been destroyed due to unseasonal rains.

The decision to increase compensation has come after a feedback by the ministers. The Reserve Bank of India has already directed lenders to restructure loans of distressed farmers.