AIS India

Rainfed crops play a major role in Indian agriculture. On about 60% of the sown area, farming depends entirely on rain. The rest is irrigated. 

Smallholders practice rainfed agriculture across a wide range of soil types and agro-climatic conditions. The amount of rainfall also varies considerably by region, from about 400 mm per year to 1600 mm. Many “rainfed” agricultural areas are arid. Farming under such conditions is difficult, and productivity low. This kind of agriculture is usually a means of subsistence rather than a source of income. 

Changes in the monsoon season often mean a lack of water during crops’ main growth stage. 

Increasingly unpredictable rainfall makes it hard for farmers to time their sowing. Outdated farming practices and differences in soil types can exacerbate water stress. The combined result of these various factors can be partial or complete crop failure. 

Uncertainty about the timing and amount of rain discourages investment in higher-value seeds. Such varieties can improve crop quality and quantity. To reduce up-front financial risk, however, many Indian farmers choose cheaper seeds. These are typically inferior. Harvests are therefore poorer than they should be. Farmers’ income remains low, further discouraging investment in good inputs. The vicious circle continues.  

Syngenta Foundation India (SFI) is helping to address this challenge

A crucial step to enable smallholders to invest for better crops is to reduce their risk. SFI has therefore established a program called Replanting Guarantee. This provides weather insurance of various types. One example is Rainfall Index-Based Insurance for selected varieties of maize (corn) and rice from Syngenta India (SIPL). This cover is made possible through collaboration with ICICI Lombard General Insurance. The policies protect smallholder maize and rice growers against the effects of insufficient rainfall during the early crop phases (sowing, establishment, and rice-transplanting). 

The premium adds 6% to the seed price. In our program, farmers pay the total premium; in government schemes, subsidies play a big role. If rainfall is less than the amount specified by a local index, farmers can claim compensation. Payout enables them to buy new seeds. Our flow chart illustrates the process.  

How the Replanting Guarantee works 

Our Replanting Guarantee contributes to food security by encouraging vulnerable smallholders to adopt higher-yielding varieties. It is India’s such first program but shares several features of our insurance work internationally. One is the attention to smallholder education and information. Call center employees help farmers better understand the insurance products and processes. They also reply to any complaints. 

Another feature common to our insurance programs is the use of mobile technology. This increases speed, accuracy, cost-efficiency, and reach. For the Replanting Guarantee, insurance registration, policy dispatch, and claims processing all run via mobile technology.

Claims processing needs to be fast: Smallholders cannot afford to wait long for compensation. Our scheme offers quick pay-outs if too little rain falls. Farmers can then choose to resow either with rapidly maturing crops or fodder as back-up. 

We focus strongly on rainfall-related insurance because changing weather patterns play such a big role in agriculture. However, Indian smallholders also face other challenges. Here, too, appropriate insurance can strengthen their resilience. 

Minimum Price Protection 

Kind weather and a healthy harvest alone do not ensure good income. Crop prices also determine how much farmers earn. Most smallholders lack modern storage facilities. They therefore face a bleak choice. Selling during an abundant harvest means earning low prices. Storing the crop in unsuitable ways runs the risk of losses. The threats include pests, rodents, and diseases. 

To address this issue, we have developed Minimum Price Guarantee Insurance. During the risk period, insured farmers are guaranteed a particular price. The amount is based on historical data from the Agriculture Produce Market Committee. If the actual market price falls below the guaranteed level, the insurer makes up the difference. This safety net enables smallholders to rest assured of a known level of revenue.

Program info since 2022

(Dollar values are approximate)