UPSC Prelims 2016 question on Pradhan Mantri Fasal Bima Yojana

The correct answer is 2 only.

Core Conceptual Framework

The Pradhan Mantri Fasal Bima Yojana (PMFBY) is India's flagship crop insurance scheme launched in 2016. It operates on an actuarial premium basis but protects farmers by capping their financial outgo. The core of the scheme lies in its differential seasonal premium architecture and its comprehensive risk coverage framework spanning the entire cropping cycle (from pre-sowing to post-harvest).

Statement-by-Statement Elimination

• Statement 1: Under this scheme, farmers will have to pay a uniform premium of two percent for any crop they cultivate in any season of the year. (Incorrect)
• The Trap: The statement uses the absolute qualifiers "any crop" and "any season."
• The Fact: PMFBY explicitly breaks down premium caps based on seasons and crop classifications to reflect varying risks:
• Kharif Crops: 2% of the sum insured.
• Rabi Crops: 1.5% of the sum insured.
• Annual Commercial / Horticultural Crops: 5% of the sum insured.
• The government (shared equally between the Centre and States) absorbs the entire remaining actuarial premium subsidy balance.
• Statement 2: This scheme covers post-harvest losses arising out of cyclones and unseasonal rains. (Correct)
• The Fact: PMFBY was formulated to rectify gaps in older insurance schemes by expanding coverage to localized and post-harvest perils. It provides dynamic protection for up to a maximum period of 14 days (two weeks) from harvesting. This specific cover applies to crops that are left in a "cut and spread" condition to dry in the field against specific perils like cyclones, cyclonic rains, and unseasonal downpours.

How to Solve This in the Exam (UPSC Elimination Strategy)

1. Expose the Extreme Generalization: Read Statement 1 critically. A standard rule of thumb for government scheme questions in Prelims is that the bureaucracy rarely implements a flat, single premium rate across vastly different risk profiles (e.g., comparing monsoon-dependent staple Kharif crops with high-value commercial horticulture). The absolute phrase "any crop... in any season" should immediately flash a red flag.
2. Verify the Intent of the Reform: Recall why PMFBY was introduced to replace older schemes like NAIS and MNAIS. One of its landmark structural highlights was expanding insurance boundaries to protect farmers from climate-induced losses that occur after the harvest is cut but before it reaches the mandis. Statement 2 directly checks this foundational policy pillar.
3. Isolate and Select: Marking Statement 1 as false immediately drops "1 only" and "Both 1 and 2". Recognizing Statement 2 as a core objective of the 2016 revamping seals 2 only without hesitation.