PIB Summary - 12th August 2025 | PIB (Press Information Bureau) Summary - UPSC PDF Download

Empowering Annadatas: Pradhan Mantri Fasal Bima Yojana

Background & Context

Launched: The Pradhan Mantri Fasal Bima Yojana (PMFBY) was launched on February 18, 2016, to replace earlier schemes like the National Agricultural Insurance Scheme (NAIS) and the Modified NAIS (MNAIS).

Objective: The primary goal of PMFBY is to provide affordable and comprehensive crop insurance to farmers, protecting them against non-preventable natural risks.

Coverage: The scheme covers various stages from pre-sowing to post-harvest, including damage during storage if caused by notified calamities.

Principle: The scheme operates on the principle of "One Nation – One Crop – One Premium," ensuring a uniform approach to crop insurance across the country.

Type: PMFBY is an area-based crop insurance scheme.

Key Performance Statistics (2016–2025)

• Total applications insured: 78.41 crore.
• Claims paid: ₹1.83 lakh crore to 22.667 crore farmers.
• Enrolment growth: 3.17 crore farmers (2022–23) to 4.19 crore (2024–25), a 32% increase, the highest since inception.
• Non-loanee farmer participation: Increased from 20 lakh (2014–15) to 522 lakh (2024–25).
• Farmer applications coverage: Expanded from 371 lakh (2014–15) to 1510 lakh (2024–25).
• PMFBY is the largest crop insurance scheme in the world in terms of farmer applications.

Financial Structure

Premiums paid by farmers:

• Kharif food/oilseed crops – 2% of sum insured.
• Rabi food/oilseed crops – 1.5%.
• Annual commercial/horticultural crops – 5%.

Government’s share: The government bears the remaining 95–98.5% of the premium.

Sharing ratio:

• Normal States – 50:50 between Centre and State.
• Northeast States (Kharif 2020 onwards) & Himalayan States (Kharif 2023 onwards) – 90:10.

Risk Coverage under PMFBY

• Yield Losses: Covers losses due to various factors such as drought, floods, pests, diseases, cyclones, hailstorms, and landslides.
• Prevented Sowing: Provides coverage of up to 25% of the sum insured if sowing is prevented due to adverse weather conditions.
• Post-harvest Losses: Covers losses occurring up to 14 days post-harvest for "cut & spread" crops damaged by cyclones or cyclonic rains.
• Localized Calamities: Includes coverage for localized calamities such as hailstorms, landslides, and inundation impacting individual farms.

Implementation Reforms (2016–2025)

Transparency & Accountability

• National Crop Insurance Portal (NCIP):. centralized online platform for enrolment, data sharing, and direct transfer of claims.
• Digi-Claim Module: Operational since Kharif 2022, this module is linked to the Public Financial Management System (PFMS) and insurer systems for real-time settlement of claims. A 12% penalty is automatically applied for delayed payments starting from Kharif 2024.
• Premium Subsidy Reform: The central subsidy is now disbursed separately from the State share to avoid delays in premium payments.
• Mandatory ESCROW Accounts: From Kharif 2025, States are required to maintain ESCROW accounts for timely contribution of premium subsidies.

Farmer Awareness Initiatives

• ‘Meri Policy Mere Haath’: This initiative involves the physical distribution of insurance policies at the village level to ensure farmers receive their policies directly.
• Fasal Bima Saptah: Conducted twice a year, this initiative aims to educate farmers about the benefits and details of crop insurance.
• Fasal Bima Pathshalas: These are educational sessions designed to inform farmers about crop insurance and its importance.
• KrishiRakshak Portal & Helpline (14447):. grievance redressal system that operates on a ticket-based mechanism, ensuring farmers’ issues are addressed within fixed timelines.

Technology Integration

• YES-TECH: This technology involves remote sensing-based yield estimation and has been launched for crops like paddy and wheat in Kharif 2023, with soybean added in Kharif 2024. A minimum of 30% weightage is given to YES-TECH data in yield calculation.
• WINDS: The network of Automatic Weather Stations and Rain Gauges has been expanded fivefold, providing hyper-local weather data for PMFBY, drought management, and weather forecasting.

Institutional & Policy Continuity

• January 2025 Cabinet Approval: The continuation of PMFBY and the Restructured Weather Based Crop Insurance Scheme (RWBCIS) has been approved until 2025–26 with a budget of ₹69,515.71 crore.
• RWBCIS (Weather Based Crop Insurance Scheme): This scheme calculates claims based on weather indices rather than yield, distinguishing it from PMFBY which is yield-based.

Farmer Profile in PMFBY (2024–25)

• Tenant farmers: Constitute 6.5% of applications.
• Marginal farmers: Make up 17.6% of applications.
• Loanee farmers: Account for 48% of applications.
• Remaining: Non-loanee small and medium farmers fill the rest of the applications.

Significance

• Reduces Vulnerability: PMFBY helps in reducing farmers’ vulnerability to climate risks and income shocks, providing them with a safety net against unexpected natural disasters.
• Encourages Investment: The scheme encourages farmers to invest in improved seeds, mechanization, and sustainable agricultural practices by providing them with financial security.
• Prevents Debt Traps: By ensuring timely financial assistance, PMFBY prevents farmers from falling into debt traps, which is a common issue in the agricultural sector.
• Promotes Inclusive Coverage: The scheme has seen a sharp rise in non-loanee participation, promoting inclusive coverage among different farmer categories.

Challenges

• Delay in State Premium Share: Despite reforms, delays in State premium share continue to be a cause for delayed claim settlements, affecting the timely disbursement of claims to farmers.
• Yield Estimation Disputes: The integration of technology for yield estimation is ongoing but not fully scaled, leading to disputes in yield estimation which can affect the claims process.
• Awareness Gaps: Many small and marginal farmers still lack a complete understanding of the claim procedures and the benefits of the scheme, which can hinder their participation and timely claims.
• Voluntary Enrolment for Loanee Farmers: There is a risk of lower participation among loanee farmers if they are not incentivized to enroll in the scheme, which can affect the overall coverage and effectiveness of the scheme.

Pointers

• Schemes Linkage: PMFBY is aligned with initiatives aimed at Doubling Farmers’ Income and the National Mission on Sustainable Agriculture, ensuring that the scheme supports broader agricultural and economic goals. 
• SDG Linkage: The scheme contributes to several Sustainable Development Goals (SDGs) including: 
• SDG 1 (No Poverty): By providing financial security to farmers, PMFBY helps in reducing poverty levels in rural areas. 
• SDG 2 (Zero Hunger): The scheme supports food security by ensuring that farmers can recover from losses and continue production, contributing to the goal of zero hunger. 
• SDG 13 (Climate Action): PMFBY plays a role in climate action by promoting sustainable agricultural practices and providing a buffer against climate-related shocks. 

Comprehensive reforms taken up to instill credit discipline in PSBs

Background and Rationale for Reforms in Public Sector Banks (PSBs)

• The persistent crisis of Non-Performing Assets (NPAs) in the 2010s weakened both credit growth and the profitability of banks.
• There was a lack of credit discipline due to factors such as lax loan appraisal processes, political interference, and the practice of evergreening loans.
• Governance in PSBs was flawed, with weak accountability for top management.
• PSBs faced a technology gap and inefficiency when compared to private sector banks.
• Despite mandates for priority sector lending, there was low credit penetration to Micro, Small, and Medium Enterprises (MSMEs) and underserved sectors.

Relevance: GS 3 (Banking and Economy)

Comprehensive Reforms to Instill Credit Discipline

a) Legal & Institutional Framework

• Insolvency and Bankruptcy Code (IBC), 2016: This code facilitates the time-bound resolution of corporate insolvency and acts as a deterrent against willful default.
• Central Repository of Information on Large Credits (CRILC): Managed by the Reserve Bank of India (RBI), this database monitors loans exceeding ₹5 crore, enabling early detection of financial stress.
• Early Warning Systems: These automated, data-driven systems use third-party data and transaction monitoring to flag potential NPAs (Non-Performing Assets) early.
• Market-based Stressed Asset Transfer Framework: This framework allows eligible entities to acquire stressed loans, thereby reducing the risk on PSB balance sheets.
• National Asset Reconstruction Company Ltd. (NARCL): Operating on a 'bad bank' model, NARCL aggregates and resolves large stressed debts.

b) Governance & Risk Management

• Appointment of Top Executives: The Financial Services Institutions Bureau (FSIB) now appoints top PSB executives at arm's length to ensure impartiality.
• Non-Executive Chairmen: Nationalised banks now have non-executive chairmen to enhance board oversight.
• Performance-linked Tenure Extensions: MDs and CEOs can have their tenures extended based on performance metrics.
• Enhanced Access & Service Excellence (EASE) Reforms: These reforms benchmark governance, risk management, human resources, and technology adoption in PSBs.
• Amalgamation of PSBs: Between 2017 and 2020, 27 PSBs were consolidated into 12 to achieve economies of scale and operational efficiency.

c) Legislative Measures

• Banking Regulation (Amendment) Act, 2020: This act extended RBI's oversight to co-operative banks and improved depositor protection measures.
• Banking Laws (Amendment) Act, 2025: This act established higher governance standards, stronger audit norms, statutory reporting to the RBI, and simplified nomination processes for bank boards.

Technology Adoption & Financial Inclusion

• JAM Trinity: The integration of Jan Dhan accounts, Aadhaar, and mobile technology has enabled mass Direct Benefit Transfers (DBTs) and reduced leakages.
• Digital Payment Growth: From FY 2017–18 to FY 2024–25, the volume of digital payments increased from 2,071 crore to 22,831 crore, with a compound annual growth rate (CAGR) of 41%. The value of digital payments also saw significant growth, rising from ₹1,962 lakh crore to ₹3,509 lakh crore.
• UPI Growth: The volume of Unified Payments Interface (UPI) transactions surged from 92 crore to 18,587 crore, reflecting a CAGR of 114%. The value of UPI transactions increased from ₹1.10 lakh crore to ₹261 lakh crore. A notable milestone was reached in July 2025, with 1,946.79 crore monthly transactions.

Measures to Boost Credit Flow to MSMEs

a) Credit Guarantee & Liquidity Support

• Mutual Credit Guarantee Scheme for MSMEs (MCGS-MSME, 2025): This government-backed scheme offers guarantees for term loans up to ₹100 crore, specifically for the purchase of equipment and machinery. The total guarantee cap is set at ₹7 lakh crore or four years.
• Emergency Credit Line Guarantee Scheme (ECLGS): Under this scheme, lenders receive a 100% guarantee, providing liquidity support of ₹3.68 lakh crore to 1.19 crore businesses. This includes ₹2.42 lakh crore directed to 1.13 crore MSMEs.

b) Credit Appraisal Reforms

• New Credit Assessment Model for MSMEs (2025): This model employs digital and verifiable data along with automated risk scoring to assess creditworthiness. It covers both Existing-to-Bank (ETB) and New-to-Bank (NTB) borrowers.

c) Strengthening CGTMSE

• Guarantee Cover: The scheme offers up to 85% guarantee cover for loans not exceeding ₹10 crore to Micro and Small Enterprises (MSEs).
• Reduced Annual Guarantee Fee: The annual guarantee fee has been lowered to between 0.37% and 1.20%.
• Cumulative Guarantees: As of 31 July 2025, the scheme has provided 1.22 crore guarantees worth ₹10.50 lakh crore.

Impact Assessment

• Improvement in Credit Discipline: The implementation of the Insolvency and Bankruptcy Code (IBC) has deterred willful defaults, while the Central Repository of Information on Large Credits (CRILC) and early warning systems have enhanced monitoring and early detection of potential NPAs. 
• Enhanced NPA Recovery and Resolution: The efficiency of NPA recovery and resolution processes has been significantly improved through the establishment of the National Asset Reconstruction Company Ltd. (NARCL) and the introduction of market-based transfer frameworks for stressed assets. 
• Upgraded Governance in PSBs: The quality of governance in Public Sector Banks (PSBs) has been substantially upgraded through measures such as the arm's length appointment of executives by the Financial Services Institutions Bureau (FSIB), the implementation of Enhanced Access & Service Excellence (EASE) reforms, and the amalgamation of several PSBs. 
• Increased MSME Credit Penetration: Credit penetration to Micro, Small, and Medium Enterprises (MSMEs) has widened due to targeted guarantee schemes and the adoption of digital credit appraisal methods. 
• Transformation of Digital Payments Ecosystem: India has emerged as a global leader in real-time digital transactions, with a transformed digital payments ecosystem characterized by significant growth in transaction volumes and values. 
• Improved Co-operative Bank Stability: The stability of co-operative banks has been enhanced following the amendments to the Banking Regulation in 2020, which extended RBI oversight and improved depositor protection. 

Centres of Excellence for minority literary heritage

Overview

The Ministry has sanctioned five Centres of Excellence dedicated to minority literary heritage under the Pradhan Mantri Jan Vikas Karyakram (PMJVK). Each centre, hosted by a prominent university, aims to focus on different minority traditions.

Institutions and Objectives

Workshop & Strategic Focus

A national workshop on Jain Manuscriptology took place on July 19, 2025, at Gujarat University. The event brought together scholars, researchers, and community leaders to discuss:

• Preservation techniques and the research potential of Jain manuscripts
• Integrating ancient wisdom into modern academic and cultural narratives
• Community involvement in conservation efforts

Significance for UPSC

• Demonstrates India’s commitment to cultural pluralism and the preservation of diverse heritages.
• Highlights the PMJVK as a focused initiative for the inclusive development of minority communities.
• Shows the integration of culture, technology (digitisation), and education policy in heritage conservation.
• Reflects the importance of academic partnerships with communities in efforts to preserve and promote cultural heritage.

Way Forward

•  Ensure sustainable funding and operation of the Centres in the long run. 
•  Develop digital repositories that are accessible to scholars across the country. 
•  Encourage interdisciplinary research and public outreach initiatives. 
•  Foster international collaborations to enhance research and preservation activities.