The government will also make a strong appeal to the BJP-led government at the centre to direct the General Insurance Corporation of India to implement the scheme. The ruling BJP at the centre, in its national agenda for governance, has promised the crop insurance scheme.

Mantralaya sources said that in the proposed scheme, the rate of premium would have to be fixed between two and 10 per cent on actuarial rate for various crops, while the indemnity level would be 80 per cent. The amount on account of premium collected would depend upon the participation of farmers who have not taken loans.

The estimated expenditure for the centre for ongoing crop insurance scheme was Rs 4,000 crore and based on past experience, the amount for Maharashtra wasestimated at Rs 400 crore. If 50 per cent of farmers participate in the scheme, the government would have to incur an expenditure of Rs 200 crore on account of subsidy to farmers excluding the administrative expenditure.

In the proposed scheme, the estimate of premium collected and compensation to be paid based on different levels of indemnity level were worked out after considering the sum insured based on support price as well as scale of finance recommended by the department of agriculture and district central cooperative banks (DCC). Under the proposed scheme, there would be a 50-per cent area coverage and the limit for sum insured for a farmer per season would be Rs 15,000.

If 50 per cent of farmers from the state participate and all crops were covered under the scheme then the sum insured as per support price would be about Rs 5,000 crore. As per the scale of finance recommended by the department of agriculture, it would be Rs 4,000 crore and as per the DCC banks it would be Rs 3,500 crore. The suminsured excluding cotton would be Rs 4,000 crore, Rs 3,000 crore, Rs 2,750 crore respectively.

The premium collected would be Rs 100 crore to Rs 400 crore at different indemnity levels. The premium collected excluding cotton would be Rs 165 crore at 80 per cent level and sum insured based on scale of finance recommended by the department of agriculture. The compensation to be paid would be as much as premium collected or less at different indemnity levels (Rs 50 crore to Rs 350 crore). The premium collected at actuarial rate and compensation to be paid were more or less equal, hence in this respect the provision of Rs 25 to 50 crore was sufficient.

The premium collection of small and marginal farmers and other farmers could be decided as follows: 75 per cent subsidy to all farmers, 100 per cent subsidy to small and marginal farmers only, 100 per cent subsidy to small and marginal farmers and 50 per cent of subsidy to other farmers, 100 per cent subsidy to small and marginal farmers and 75 per cent subsidyto other farmers and 75 per cent subsidy to small and marginal farmers and 50 per cent subsidy to other farmers.

At these different subsidy levels and different indemnity level the the state government would have to bear a financial burden of Rs 100 to 150.The state government thought it fit to formulate the new comprehensive crop insurance scheme based on risk calculation and risk coverage as the Centre-sponsored crop insurance scheme was actually a crop loan scheme. The present scheme introduced in 1985 was only applicable to loanee farmers and non-loanee farmers were not protected by this scheme.