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Crop production is susceptible to numerous risks and uncertainties in varying degrees all over the world. The most potent and serious ones are those that are posed by the natural forces like cyclones, floods, tornadoes, hailstorms, draughts, earth quakes and the likes. Some of these risks could be partially mitigated through the physical means like improved and increased physical infrastructures such as irrigation, drainage, flood control and better agronomic practices. But the major physical forces are beyond man’s control and have to be addressed through the collective social devises. Crop insurance is such devise for managing risks in crop production. It is not in exclusion of the physical means but in addition to them.
   The major benefits that flow from an effective crop insurance system are stability and security to farm investment and income and assurance of fresh fund for reinvestment in the event of large scale damages to production .In the developing countries, losses in production of small and marginal farmers lead to their increasing indebtedness and pauperization and result in their growing landlessness. Protection of their investment and income through crop insurance could therefore contribute greatly towards lifting them out of the trap of increasing landlessness and resultant poverty and deprivations.
   There are evidences of increasing frequency and magnitude of damages to agricultural production due to deteriorating global warming situations. As per Munich Re, a leading re-insurer, the average annual loss to weather related events increased ten folds during 1950 to 1999. Costs associated with crop damaging events were doubling during every decade. Such challenges to agricultural production are therefore pushing up the demands for crop insurance.
   Besides, as economy develops, urbanization expands, agro-processing and exports of agricultural commodities pick up momentum, producers start making larger investment per land unit to meet the growing demands for their commodities. It is at such stages of growth that providing insurance support becomes an absolute necessity to secure their investment and income and thereby bring stability in the production and supply systems. Such stability is also essential for orderly growth of international trade in agricultural commodities. This is precisely why subsidy to crop insurance premium has been permitted by World Trade Organization (WTO) up to a certain percentage of their respective GDPs under WTO Agreement on Agriculture, 1995. Such subsidies are considered to be falling under the ‘Green Box’ of measures by which member states can support their producers. As a developing country, Bangladesh is entitled to spend up to ten percent of its contribution from agriculture to subsidize her agricultural insurance program. At present it is nil. Direct payment of subsidies is however discouraged under such regulations. Admissibility of subsidy payment to crop insurance premium is evidently an open and explicit invitation to promote crop insurance.
   Crop insurance practices have been evolving gradually over years in various forms as per compelling requirements of the practicing countries. Crop insurance was initially a domain of the developed world. During the last few decades, developing countries are increasingly stepping into this important field. Crop insurance forms and approaches vary largely depending upon the major economic and social objectives and existing economic strength of the respective countries. They also vary on modus operandi to reach out the beneficiaries through various means: individually or collectively through credit agencies, agro processors, marketing channels or NGOs. New insurance products are thus being developed to meet the growing challenges to production.
   
   Crop insurance experiences of
   some countries
   USA: In the USA, the present crop insurance system has been gradually developed over a period of more than one century of experimentation, studies and trials with their full shares of successes and failures. The major breakthrough came with the passage of Federal Crop Insurance Act of 1938 under which Federal Crop Insurance Corporation was set up to start the programme on a pilot scale. Despite a variety of innovations, the farmer participation could hardly rise to ten percent of the eligible crop acreage prior to 1980. Accordingly, major changes were effected in the Crop Insurance Act of 1980, which included, among others, provision of liberal subsidy to premium, induction of the private insurance agencies to deliver the multi-peril crop insurance policies and providing them with reinsurance support and reimbursement of their administrative expenses. These measures dramatically raised farmer participation rate.
   The Federal Government has continued to bring in a variety of innovations and area specific approaches. Participation to crop insurance has been made mandatory to those farmers who receive federal assistance. A new programme ‘CAT’ was launched with 100% premium subsidy for the farmers affected by catastrophic disasters. A new organization ‘Risk Management Agency’ (RMA) was established to administer the crop insurance programme through FCIC. With the passage of the Risk Protection Act of 2000, RMA has been empowered to carry out research and development of new insurance products in cooperation with the public and private universities and research entities for which liberal allocations are now being made.
   The federal crop insurance programme is thus basically a public and private sector collaboration with RMA administering and overseeing the implementation of the programme while FCIC provides insurance and reinsurance expertise .The sale and servicing of crop insurance is being carried out by the private insurance companies who are selected and reinsured by FCIC. Presently, 19 such companies are in operation; under reinsurance contracts, they receive a variety of payments as per agreements. The system employs over 25,000 professionals.
   
   Philippines: The present crop insurance systems grew out of an Agricultural Guarantee Fund initially placed with the Land Bank of the Philippines, the principal government bank to provide guarantee to its agricultural loans. With the establishment of Philippines Crop Insurance Corporation, a parastatal body, this fund was placed with the corporation. It started operation from 1981 after a three- year period of preparatory works. The programme is heavily subsidized with government and participating credit agencies bearing the major portion of premium subsidy. Participation to crop insurance has been made mandatory in some of the highly productive but risk prone areas for two of the major staple crops: rice and maize. Self financed farmers are also allowed to avail of the crop insurance facilities enjoying only the government portion of premium subsidy.
   
   India: In India, the crop insurance programme was started on a pilot scale in 1973 based on individual approach. It was discontinued after three years and restarted in 1979 based on area approach providing coverage to crop loanees only. The programme underwent several stages of growth through implementation of a number of schemes. In this process, a variety of innovations were effected in the approaches and outreaches moving gradually towards fixation of premiums on actuarially sound basis for commercially profitable crops. Payment of subsidy is also being phased out gradually in conformity with the increasing pace of commercialization of agriculture. By the year 2000, crop insurance was availed by some 10.5 million farmers providing coverage to 15.5 million ha of crop land. The programme is now being further redesigned in cooperation with some of the leading private insurance companies with development of innovative products. A new product ‘Failed Well Insurance’ has been launched to provide coverage against significant drops in water levels of insured pumps. Another new product ‘Index Insurance’ was started to ensure against insufficient rainfall. General Insurance Corporation, a public sector agency under the Ministry of Finance has been implementing the crop insurance program. The corporation has recently established a specialized subsidiary ‘Agricultural Insurance Corporation’ to exclusively handle all commercially sound crop insurance products.
   
   Experience of Bangladesh in Crop Insurance
   Bangladesh started its crop insurance programme on a pilot scale in 1979. Sadharan Bima Corporation, a public sector insurance body under the Ministry of Commerce, was entrusted with its implementation out of its own resources. Individual approach was followed in servicing the programme which proved to be too costly and vexing. Despite its serious limitations, this approach was continued without any innovations till the programme was suspended during 1995. Area approach and linkage to institutional credit, which are among the basic factors contributing to success of such programs else where could not be introduced due primarily to bureaucratic hindrances and government apathy. Strong political commitment is a must for any such programme to succeed which has unfortunately been missing. It also suffered from a variety of other institutional problems including administrative weaknesses, lack of trained manpower and the like. Financial burden to running this weak programme with its mounting losses became too prohibitive for SBC to continue without any government financial support with loss ratio rising around 600%. Hence as per recommendation of a high level committee, the programme was suspended pending restart of a strengthened programme based on area approach and linkage to institutional credit.
   During the last one decade, several expert committees were formed by the government to explore the possibility of reviving the programme but with little or no effect. Meanwhile, Bangladesh agriculture has been moving ahead with its increasing pace of commercialisation. The burgeoning investments in agriculture need protection against various risks by providing low cost insurance cover to promote further investment and growth. It is against this backdrop that we greatly welcome the Finance Minister’s proposal for establishing one special Fund for Assistance to Small farmers Affected by Natural Disasters with an initial sum of Tk 50 crore in the 2006-07 budget to cater to the specific requirements of agricultural insurance. It is gratifying that this proposal has finally been approved by Parliament. The Fund will hopefully be made operational from the current financial year. Detailed modalities of Fund operation will now have to be worked out and simultaneously a modest but strong and effective organizational base for starting a fresh programme instituted in right earnest. This fund should preferably be termed as Agricultural Insurance or Risk Protection Fund. Diversion of this Fund towards meeting any emergency relief requirements must not be allowed in the interest of developing the agricultural insurance programme on a sound basis. Bangladesh Bank has to be deeply involved in running this Fund with a view to providing the much needed credit –insurance linkages as well as to facilitating radical improvements in credit packaging and delivery mechanism. Without these improvements, crop credit insurance linkage will bring in disastrous results.
   Crop insurance is a serious and complex issue and needs deep government commitment and sound management to make it a success. Some level of subsidy is also a must during the initial years and this is why it has been made admissible under WTO Rules as stated earlier. Several expert committees already spelled out how a revamped programme could be started. These proposals should help the government in power to initiate the process.
   
   Suggestions
   The proposed Agricultural Insurance Fund be operated in close cooperation with Bangladesh Bank .The Fund should thus preferably be set up in Bangladesh Bank and a part of Agricultural Credit Stabilization Fund (ACSF) of Bangladesh Bank , which has continued to be accumulated over years, be diverted to this Fund .The Fund should meet the two basic needs of agricultural insurance namely: i) providing premium subsidy to identified priority portfolios for small and land poor rural households and ii) paying an agreed part of excess indemnity claims over premium receipts of the participating insurance agencies in public and private sectors.
   Area approach be followed for crop insurance with crop yields and damage assessment exercises being conducted by Bangladesh Bureau of Statistics through crop cuts; individual approach be followed for other portfolios like livestock and for farming on commercial basis.
   One strengthened Agricultural Insurance Unit be set up within Sadharan Bima Corporation with agricultural and other specialists to take care of both crop and livestock insurance components simultaneously, Initial two years should be devoted to developing suitable models and approaches supported by one TAPP with possible donor funding to provide much needed expertise; intensive training programme should also be launched during that period to develop trained manpower of the participating agencies;
   Agricultural insurance courses should be included in the curriculum of the universities, particularly agricultural universities and colleges;
   There should be a consortium of Sadharan Bima Corporation with some of the leading private insurance companies to participate in the promising portfolios of crop and livestock insurance;
   There should be no political divide on the national issue of developing and meeting the basic requirements of agricultural insurance.
   The writer is retired Chief, Planning, Ministry of Agriculture, the Government of Bangladesh. He can be reached at: nh_miah@yahoo.com

It was indeed terrible Tuesday (11/7/06) when innocent commuters going back home after a hard day's work were targeted with bomb blasts from Matunga to Bhayandar on western suburban trains in Mumbai. So far the death toll is more than 200 and about 700 people injured, many of them quite severely. No words are enough to condemn such horrible crime against humanity. No one who has even elementary sense of being human will commit such a dastardly act.
   Earlier, the same day, in the morning, eight persons lost their lives in Srinagar, five of them tourists from West Bengal. Grenades were thrown at the tourist bus proceeding towards Pahalgam. Why these killings? Who is behind it? Earlier violence was mostly confined to Kashmir valley. Now this has spread to various cities of north India –– Delhi, Varanasi, Ayodhya and Mumbai. Mumbai witnessed such horrifying bomb blasts the second time, the first time was in March 1993 in which more than 250 innocent people had lost their lives.
   Some people think, as many Kashmiris thought in 1989, that violence is the only way out and if they take to guns, azadi would be near at hand. Now, after losing 80,000 lives, they have realised what repercussions violence brings about. 'Azadi' is as far away as it ever was for Kashmiris and all they have gained is violence and more violence. Peace now is as elusive as azadi itself.
   We can very well realise the wisdom of Gandhiji's insistence on non-violence for attaining freedom for India from clutches of British imperialism. No one believed Gandhiji when he talked of achieving India's freedom through non-violence. Even Churchill, the then Prime Minister of Britain, talked of Gandhiji with scorn and said what this 'naked faqir' could do to the mighty British empire, on which even the sun never set.
   The world saw that the naked faqir and his non-violence shook the British Empire and got freedom for India. Some people think that the oppressed are justified in using violence, and, secondly, that without violence one cannot achieve liberation from the oppressors. However, one forgets that while violence is physical, non-violence is moral and spiritual. While the oppressed may not be able to match violence of the oppressor, non-violence gives the oppressed moral superiority and puts the oppressor to shame.
   However, it is not easy to practice non-violence for an ordinary person. It requires tremendous inner discipline. In Gandhiji's theory of non-violence there is equally important concept of what he called satyagraha (insistence on truth) and this requires tremendous patience. Thus non-violence, insistence on truth and patience, all go together and this has an appeal of its own and if practised honestly, it can achieve tremendous results as Gandhiji showed.
   Interestingly, Gandhiji's concept comes very close to the Qur'anic teaching of truth and patience (haq and sabr) as enshrined in chapter 103. It is great shame that the so-called 'jihadis are committing such dastardly acts of violence in the name of Islam. Nothing can be more un-Islamic than these horrifying inhuman acts. This game is being played for power and pelf by a section of Pakistani army. These terrorists cannot carry on such powerful blasts without the support of ISI of Pakistan. Lashkar-e-Toiba, which is suspected to be behind such acts, cannot sustain itself without active help from ISI. Though Lashkar-e-Toiba has denied responsibility for these serial blasts on Tuesday, and the police too has not reached any decisive conclusion, yet all available indications point in that direction.
   Nawaz Sharif on ISI
   Nawaz Sharif, the former Prime Minister of Pakistan has said in his recently published biography that ISI is not under government control and has been trying to destabilise India and Bangladesh.
    He is certainly in know of things in Pakistan and what he says cannot be lightly dismissed.
   It is such a matter of shame that Pakistan, which claims to be an Islamic state, is bringing shame and disgrace to Islam. No other Islamic country is home to so many terrorists as Pakistan is. Pakistan also has become a front state for all American designs, which further fuels violence and creates more terrorists. In fact, if Pakistan were true to Islam then it should have been a haven of peace. The prophet of Islam made peace central to Islamic teachings.
   He accepted the peace treaty of Hudaibiyah, which was thought to be humiliating by most of his close companions and yet the Prophet (PBUH) insisted on accepting the treaty as it led to establishing peace. What could be a better or noble example than this? But these terrorists feel no pang of conscience in killing innocent citizens. Even according to the rules of Shari'ah, non-combatants cannot be killed. These rules are precursors to the Geneva Agreement, which was drawn up hundreds of years after these Shari'ah rules.
   However, it is these Muslims who are openly defying these Shari'ah rules in the name of Islam. What could be more condemnable? Also how can one invoke jihad in the name of Kashmir? Jihad is not meant for conquering territory, it is for defending oneself, if attacked, and for controlling one's evil desires. The Qur'an specifically prohibits any war of aggression. It clearly says, ‘Fight in the way of Allah those who fight you. Do not commit aggression; Allah does not love aggressors.’ (2:190)
   In throwing bombs and killing innocent people, these Muslims are doubly guilty: they are showing aggression against those who are not aggressors, and, over and above that, they are killing non-combatants. Thus they are violating every injunction of Islam and yet, ironically, in the name of Islam, they have named their armed groups as Lashkar-e-Toiba ‘ (Holy Army) and ‘Jaish-e-Mohammad’ (the Army of Mohammad, peace be upon him). How can an army which kills innocent people be a holy army or army of Holy Prophet? Those who commit such inhuman deeds can never deserve to be called, as they call themselves, holy army or army of Mohammad (PBUH).
   And as for jihad, it has never been used in the sense of war in the Qur'an. There are other words like qital and harb for war. The Prophet (PBUH), when asked what is jihad, is reported to have said that the best form of jihad is speaking truth in the face of a tyrannical ruler. But here the so-called jihadis themselves are tyrannical and it is required to speak the plain truth about them. They need to be told that what they are doing is tyranny against innocent people.
   It is such dastardly acts which have brought a bad name to Islam in the popular imagination. We claim that Islam is a religion of peace but such acts convince people that Islam has nothing to do with peace, but with violence and terrorism. It is in fact the duty of Muslims to project themselves as a model for peaceful behaviour. We cannot expect common people to discern and discriminate between handful of aggressors and large mass of Muslims living in peace with others and sticking to the Islamic teaching of peace.
   It is believed that one of the intentions of such killings of innocent people is to start communal violence in India. They carried out bomb-blasts in Ayodhya, in a temple in Varanasi and earlier in a market place in Delhi last October. But the people of India are mature enough not to fall prey to such dirty games. When a blast was carried out at a temple in Varanasi, it was feared that it would trigger off communal riots.
   But not only Muslim leaders and intellectuals, but also the chief mufti of Varanasi issued a fatwa decrying that attack on the temple, quoting the Qur'anic verse that to kill one innocent human being amounts to killing the whole humanity (5:32).
   The chief mufti and chief priest of the temple in Varanasi came together and expressed solidarity, thus completely frustrating the designs of those who wanted to ignite Hindu-Muslim riots. When a blast was carried out at Ayodhya, it was feared in the same way that it might trigger-off violence between Hindus and Muslims, yet nothing happened. We must salute the maturity of Indian people.
   This time around also all important Muslim leaders have condemned this cowardly attack on innocent people. Jamiat-i-Ulama-i-Hind, Muslim League, Jamat-e-Islami-Hind, all of them spared no words in condemning this heinous crime against humanity. No sane person will ever condone such ghastly killings. The Hindus and Muslims in Mumbai rose to the occasion and helped all those who were injured and helped in taking dead bodies to hospitals.
   
   Intelligence failure
   It seems India will have to live with such attacks for sometime to come. It is, therefore, necessary to be ever alert. What happened on terrible Tuesday is also partly an intelligence failure. Though it is very difficult to predict when and where terrorists will choose to attack, it becomes all the more necessary to be very very alert. It is the duty of the government of India to protect the lives of people against such attacks.
   Also, it appears there was lack of alertness and disaster management. The police and other authorities took a long time to reach the spots of disaster. Time and again it has been stressed by the NGOs and other activists that India woefully lacks in disaster management. It has been proved once again that India needs to work hard to provide for emergency situations.
   People themselves were, it appears, more prepared than the authorities. Such major disasters –– man-made or natural –– are bound to take place time and again and so the government should work in all seriousness to evolve a disaster management plan.
   Outlook India online edition, July 14, 2006