The Narendra Modi government in the first cabinet meeting of the year 2025 has approved two decisions for farmers: continuation of the crop insurance scheme and fertilizer subsidy. In its over six months in power, the government has taken 23 decisions for the farmers, the highest for any segment.
This assumes significance as farmers have been protesting asking for a legal guarantee for the minimum support price (MSP). Though the government has stopped short of providing a legislative cover for the MSP, it has taken other decisions including increasing the MSP for crops.
The BJP-led government draws solace from the fact that though the farmers' organisations have been vocal in their demands even threatening to harm its electoral prospects, the election results in Haryana and Maharashtra have been in its favour.
Ours is a Government fully committed to furthering welfare of farmers. We are proud of all our farmer sisters and brothers who work hard to feed our nation. The first Cabinet of 2025 is dedicated to enhancing prosperity for our farmers. I am glad that key decisions have been…
— Narendra Modi (@narendramodi) January 1, 2025
The Modi government is keen to showcase itself as empathetic towards the farmer demands as the angst of the community has a tendency to escalate.
Briefing the media about the cabinet decision, Information and Broadcasting Minister Ashwini Vaishnaw said the cabinet had approved the continuation of the Pradhan Mantri Fasal Bima Yojana and Restructured Weather Based Crop Insurance Scheme till 2025-26 with an overall outlay of Rs 69,515 crore from 2021-22 to 2025-26.
“The decision will help in risk coverage of crops from non-preventable natural calamities for farmers across the country till 2025-26.”
Vaishnaw said the scheme aims at enhancing the coverage and better disbursal of the insurance money in case of crop loss.
Another component of the scheme for large-scale technology infusion to increase transparency and claim calculation and settlement, the cabinet has also approved the creation of the Fund for Innovation and Technology (FIAT) with a corpus of Rs 824.77 crore.
In another decision, the cabinet approved an extension of the One-time Special Package on Di-Ammonium Phosphate (DAP) beyond the NBS (nutrient-based subsidy) subsidy at Rs 3,500 per MT to ensure sustainable availability of DAP at affordable prices to the farmers.
The tentative budgetary requirement for the above would be approximately up to Rs 3,850 crore, the minister said.
The government said that it has extended a massive relief to farmers by keeping the price of DAP fertilizer unchanged. “Despite geo-political constraints and volatility of global market conditions, Government kept its commitment towards farmer-friendly approach by ensuring availability of DAP to farmers at affordable prices for Kharif and Rabi 2024-25.”
Earlier, the cabinet in July, 2024 had approved a one-time Special Package on DAP beyond the NBS subsidy @ Rs 3,500 per MT from April 1 to December 31 with an approximate financial implication of Rs 2,625 crore. The Cabinet in its meeting held on January 1, 2025, approved an extension of the special package on DAP with approximate financial implications up to Rs. 3850 crore.
“With this, the total amount of special package approved for DAP since April 2024 would be more than Rs. 6,475 crore to ensure availability of DAP at an affordable price to farmers,” the cabinet statement said.
