Knowledge Report for skymet 2016 by vision VIBES

KNOWLEDGE REPORT 2016

Managing Climate Risk in Agriculture

Managing Climate Risk in Agriculture APRIL 2016

Acknowledgement Message from Mr. D.S. Rawat Secretary General ASSOCHAM Glaciers are shrinking, ice on rivers and lakes is breaking up, and intensity and spread of heatwaves are increasing drastically. As predicted earlier, 2016 is turning out to be the hottest year on record. It has been established within the scientific community that climate change is for real. The inevitable question being raised – is the recent extreme weather a manifestation of climate change? The world is working towards restricting carbon emissions but reducing global warming emissions seems a far-fetched dream for now. The need of the hour is to manage and confront climate change. Performance of Indian economy is dependent largely on agriculture which is in turn left at the mercy of Monsoon rains as a large part of the agriculture is rainfed. Back-to-back El Niño triggered droughts in India made it imperative to manage climate risk in agriculture, which still serves as the backbone of our economy. In this study aided by USAID, ASSOCHAM and Skymet collaboratively adopted a fact based analysis of contentious issues like impact of climate change on Indian Monsoon and agriculture. This study enlightened us about the scope and efficacy of new technologies in agriculture, real time crop advisories and other weather derivatives. It aims at keeping the stakeholders abreast about the innovative technologies which help entities in Agri-Business domain manage their risk better. I am also happy to note that ASSOCHAM in association with Skymet Weather Services and USAID is organizing a National Stakeholders Conference on “Managing Climate Risk in Agriculture" on April 13, 2016 in New Delhi.

D.S. Rawat Secretary General ASSOCHAM

Foreword Message from Mr. Jatin Singh CEO, Skymet Weather Services Pvt. Ltd. Agriculture for me is an avocation turned into a vocation. A journalist by profession, 12 years back I took a huge leap into the notorious business of agriculture. A deeprooted fascination for weather forecasting urged me to launch Skymet in 2003, with the aim to make weather forecasting reliable and accessible. My intension was explicit as I believe ‘forewarned is forearmed’. Prior warning about the perils approaching becomes even more imperative in a rapidly changing climate. Fluctuating weather patterns are increasingly manifesting themselves in stronger and more formidable ways. The recent Chennai deluge, El Niño induced back-to-back droughts and heat records setting new standards every year – all of these herald bigger calamities in the future unless we treat climate change as a serious threat to the environment and to humanity. Just as everything else, even Indian agriculture is being adversely affected by climate change and its associated liabilities. Though several policies are strategically being placed to contain global warming, I personally believe that the impact of climate change is irreparable. Rising rural distress after back-to-back droughts is the universe’s call to acclimatize ourselves to climate risk. Four out of 10 Indians still rely directly on farming for their livelihoods. As have been rhetorically pointed out in the Union Budget 2016, the agriculture sector has the maximum potential for growth. Just that it needs to be financially engineered and technologically advanced to unleash maximum benefit for farmers.

skymetweather.com

Weather derivatives are also seen as essential deterrents to climate change. In India, the inherently political crop insurance schemes being the most widespread tool. Crop insurance in India couldn’t come out of its nascent stage in the last 31 years. Narendra Modi government’s new Pradhan Mantri Fasal Bima Yojana (PMFBY) finally seems to be a promising scheme as it has reduced the subsidy of farmers to almost nil. Over the years, Skymet has successfully leveraged the data availed from the large number of all weather stations and well utilized the consolidated local inputs through integrated use of smart phones and sensors mounted on drones along with cadastral information taken from government sources. These have been our input for advanced crop simulation models to arrive at very high accuracy yield data that can be adopted for large area studies while maintaining cost advantages.

Jatin Singh CEO, Skymet Weather Services Pvt. Ltd.

Contents

Impact of Climate Change on Monsoon Page 9-11

Impact of Climate Change on Indian Agriculture Page 13-15

Climate Risk Management Strategy through â&#x20AC;&#x153;Real Time Crop Advisoryâ&#x20AC;? Page 17-23

Managing Crop Risk through New Technologies Page 25-29

Crop Insurance as a Risk Mitigating Tool Page 31-44

Impact of Climate Change on Monsoon

Global warming and climate change are two of the most extensively researched and discussed topical issues affecting the environment. The global temperature profile has been showing a rising trend. An overall rise by 1°C or more is quite likely by 2050, unless very strict and striking measures are adopted globally to curb the carbon emission levels. The last decade is being considered as the warmest, with the year 2015 being assessed as the hottest on record. Last three months viz. December 2015, January 2016 and February 2016 have also been adjudged the hottest December, January and February on record. A combination of climate change, global warming and a strong El Niño has given birth to such unusually warm weather conditions since records began in the year 1980. Blaming El Niño alone for this unusual rise in temperatures would be unfair. The past 30 year trends clearly indicate that global temperatures spike mostly takes place due to human-induced activities. Thus, holding climate change for making the world hotter would be fair enough. The associated effects of climate change are variability of rainfall along with increased frequency, intensity and duration of high impact weather events like heatwave, severe thunderstorms, cyclones etc. Precipitation over India is driven by the Indian Monsoon. More than 60 percent of annual rainfall is realized during this four-month long season. Monsoon is a large scale atmospheric circulation which gets influenced by the differential diabatic heating of Asia and the Indo-Pacific Ocean. The Indian subcontinent has often been described as a hotspot which generally bears a huge impact on account of any significant variation in land-atmospheric interaction. The arrival, withdrawal and sustenance of Monsoon are largely directed by the ocean heat content. Precisely, it substantially depends upon a fruitful land-ocean-atmospheric interaction for retention of Monsoon airmass characteristics. India receives 887 mm of rainfall during the four-month long Monsoon season. July and August are the rainiest months, receiving 2/3rd of the season’s rainfall. Last three decades have seen a gradual drop in the quantum of precipitation during the Monsoon. Here’s a look at the average yearly rainfall during the following decades: Decades Rainfall in Millimeters

1981- 1990

1991- 2000

2001-2010

881

877

847

The current data base for rainfall averages is from 1950-2000. However, there are no sufficient reasons to believe or conclude that seasonal rainfall will keep declining. But surely, all aspects of Monsoon inclusive of arrival and withdrawal dates, quantitative estimates, and the regional distribution need to be reviewed at periodic intervals.

10| Knowledge Report 2016

A much talked about oceanic-atmospheric phenomenon is El Niño and this has an inverse relationship with the Indian Monsoon rains. El Niño is abnormal warming of equatorial Pacific Ocean and its frequency is once in 2 to 7 years. Though El Niño is not directly an offshoot of global warming but warming of oceans on account of the latter is increasing the intensity, frequency and duration of El Niño events. The El NiñoSouthern Oscillation (ENSO) and equatorial Indian Ocean climate anomalies are the main factors that influence the inter-annual variability of the Indian summer Monsoon. In general, the temperature change during global warming is weak in low-latitudes (equatorial and tropical latitudes) compared to mid-latitudes. Accordingly, the seasonal continent-ocean surface temperature gradient, which causes the Asian Monsoon, is only slightly changing in the equatorial regions. There is a growing consensus among climate scientists that global temperature and precipitation patterns are changing. These changes are believed to accelerate over the coming century. However, the complete dynamics of how exactly global warming influences the Monsoon rainfall regionally is still far unknown.

There is a growing consensus among climate scientists that global temperature and precipitation patterns are changing.

Managing Climate Risk in Agriculture | 11

Impact of Climate Change on Indian Agriculture

Introduction Any discussion on this topic leads to apocalyptic predictions. Since I have been looking at this interaction for years, before I began to pen down this article, I wondered if there were any positives to global warming, climate change and Indian agriculture. So this is what I found. CO2 concentrations have been continuously increasing. Subjected to the availability of moisture, this parameter will boost crop productivity and positively impact agriculture. Secondly, a higher concentration of CO2 stimulates the photosynthesis process. When plants absorb more carbon they grow big faster. In addition, increased CO2 concentrations tend to suppress photo-respiration making them more water-efficient. But then that is all. Most of the scientific evidence tends to point in the opposite direction - climate change has adversely affected Indian agriculture and will continue to do so. And the government and its citizens need to think and strategize around it. Agriculture and allied sectors contribute to 17 percent of the GDP and affect 650 million Indians. India is a large country witnessing huge variation in climatic conditions. This makes it challenging to tackle climate change. Agricultural practices of this country, with diverse agro-climatic zones, depend upon several factors like natural resources, geographical location, traditional practices, government preferences, international trade agreements, public opinion and concerns, and environmental fluctuations. The primary environmental parameters that are influenced by climate change are temperature and rainfall. In the present scenario of global warming, increasing temperatures can not only influence rainfall pattern but also alter the process of glacier melt, sea level rise and forest fires. One impact of climate change that we are perpetually witnessing is El NiĂąo in the Pacific. There is a known inverse correlation between El NiĂąo and the Indian Summer Monsoon (ISMR). Between 1900 and 2000, there used to be one drought per decade on an average, while between 2000 and 2015 there have already been five. India is drying out. In addition, there is an increase in the mean annual air temperature in many regions of the country. Prominent increase has been observed in the number of hot days, and day and night temperatures from 1951 to 2013.The overall temperature has been increasing while the all India Monsoon rainfall has been decreasing from 1960 onward (refer graph on facing page). Decrease in rainfall and increase in air temperature could lead to persistent moisture deficit conditions, hampering the crop production in India. Frequent droughts during the Monsoon season under the current and projected future climate will pose enormous challenges for crop production in India. Another important observation of climate change is that rainfall averages are the same but the number of rainy days has reduced. This means more extreme events and experiencing seemingly contrary weather

14 | Knowledge Report 2016

risks like floods and droughts within the same season. Climate change is also undoing a lot of the achievements achieved by the green revolution. India has become drought resilient although not drought proof. During the past few decades the Rabi crop had started insulating India from a Kharif crop failure. Wheat had become as important as the Paddy. There were years in which the Rabi crop even surpassed the Kharif output. Rabi had become the hardy crop with very little prospect of failure. However, over the last two years this has changed. The Rabi crop has become vulnerable to unseasonal rain in March and April. With Rabi 2015-16 in the balance and prospect of unseasonal rainfall and hailstorm ahead, India is at the precipice of four failed back to back agricultural seasons. This is another emerging impact of climate change in Indian agriculture.

Temperature, Rainfall and Agriculture Studies show that rice crop yield decreases with increase in temperature. For example, an increase in temperature by 2°C decreases the grain yield by 15 to 17 percent. It’s an alarming situation because the paddy and wheat production in Northwest India has already been stagnating or even declining. Short-season crops (vegetables and fruits) are the worst affected by changes, particularly during critical periods of their growth. The frequency of hailstorm has increased (it used to be a phenomenon that was experienced mainly in the North but now it is being reported as far south as Karnataka). Similarly, an increase in temperature may significantly affect the quality of cotton, fruits, vegetables, tea, coffee, and aromatic and medicinal plants. Field experiments have proved that high temperatures around the time of flowering reduce fertility of the pollen grains as well as pollen germination on the stigma of rice and wheat crops. The nutritional quality of cereals and pulses may also be moderately affected. This in turn will threaten the nation’s nutritional security. ANNUAL AIR TEMPERATURE

ANNUAL ISMR

TEMPERATURE (LEFT PANEL) AND ALL INDIA MONSOON RAINFALL (RIGHT PANEL) TRENDS BETWEEN 1900 AND 2014.

I think the impact of climate change is irreversible. Though at COP 21, also known as the 2015 Paris Climate Conference, the world has agreed to cap emission to contain global warming by 2°C, I think we need to accept and adapt to climate risk. Here at Skymet, we think that financial engineering and transferring of weather risks from around the world is the way to go. Weather derivative is a potent weapon in blunting an adverse impact of climate change. In India, crop insurance being the most widespread tool.

Managing Climate Risk in Agriculture | 15

Climate Risk Management Strategy through “Real Time Crop Advisory”

Information and communication have always played key roles in agriculture. Ever since people have grown crops or raised livestock, they have sought information and guidance from one another. What is the most effective planting strategy? Where can I buy the improved seed or feed this year? Who is paying the highest price at the market? All these queries hover in the mind of a farmer before taking the leap. Farmers in a village may have planted the same crop for centuries, but over time, weather patterns and soil conditions change. Epidemic of pests and diseases add to the worry. Updated information allows the farmers to cope with and even benefit from these changes. But, providing such knowledge can be challenging. Agriculture is a highly localized aspect and thus, information must be tailored to suit specific conditions. The green revolution had greatly improved agricultural productivity. Now there is a demonstrable need for a new revolution that will lower the prices for consumers (through reduced waste and more efficient supply chain management), contribute to “smart” agriculture, and incentivize farmers (through higher income) to increase their production. Information and Communications Technology (ICT) is a potentially strong solution that has recently unleashed incredible prospective to improve agriculture, specifically in developing countries. Technology has taken an enormous leap. Earlier ICT meant costly, bulky, energy-consuming equipment available to the very few to store and analyze agricultural and scientific data. With the booming mobile, wireless and Internet industries, ICT has found a foothold even in poor smallholder farms and in their activities. ICT is any device, tool or application that permits the exchange or collection of data through interaction or transmission. ICT is an umbrella term that includes anything ranging from radio to satellite imagery, mobile phones and even electronic money transfers. Secondly, these above-mentioned ICTs and many others have gained traction even in impoverished regions.

Drivers of ICT in Agriculture Five main trends have been the key drivers of the use of ICT in agriculture, particularly for farmers. These are a) low-cost and pervasive connectivity, b) adaptable and more affordable tools, c) advances in data storage and exchange d) innovative business models and partnerships, and e) the democratization of information, including the open access movement and social media. These drivers will continue to shape the prospects for using ICT effectively in the agriculture sector of developing countries. Low-cost and pervasive connectivity is simply the prevalence of connectivity in terms of mobile phones, Internet and other wireless devices. This is due to a number of factors including decrease in costs, increase in competition and expansion of last-mile infrastructure.

18 | Knowledge Report 2016

Source : Caneval Ventures. (accessed July 2011)

circuit switched voice

mobile networks

fibre optical mobile data networks global networks

package switched data

managed network & application services

Telecom Industry

MOBILE TV FMIC

ICT WORLD VoIP

Internet client-server web services technology desktop computing main frames enterprise integration advanced planning systems mini computers & business intelligence ERP, CRM, SCM IT Industry packaged software media centre

electronic publishing

radio, TV & print

Media Industry incl. Consumer 1970

1980

COLLABORATIVE COMPUTING QUADRUPLE/ TRIPLE PLAY HOME AUTOMATION

IP TV gaming NARROW digital audio CASTING & video digital photography optical storage VIDEO ON digital broadcasting (CD/DVD) DEMAND flat screen technology Electronics

1990

2000

2010

ICT & MEDIA INDUSTRY Mobile phone penetration in the developing world now exceeds two subscriptions for every three people, driven by expanding networks in Asia and in Africa. This ability to purchase a low-cost mobile phone is complemented by the expansion of telecommunications infrastructure. In fact, most of the countries now provide a cell phone signal to more than 90 percent of their population, including coverage in rural areas. This rapid expansion has resulted from enabling regulations that ensure competition in the telecommunications sector as well as from high demand for mobile phone subscriptions. The reach and affordability of broadband Internet is also improving dramatically, though somewhat slower in developing regions.

Real Time Crop Advisory Different types of Package of Practices (POP) are released by the state governments, Agricultural Universities and Agri Input companies for different crops and even varieties. However, in absence of weather information it becomes very difficult to make effective use of these POP. Government and many Agri Input companies are attempting various new ways to provide agro advisories based on weather (agromet advisories by GOI, SMS, voice messages, picture messages and etc.) However, these advisories are of little importance to the farmer who requires information specific to his field and relevant for his crop and the variety. This situation is not being addressed till date. If proper and timely advisories are given to the farmer his productivity levels can be raised easily by 20 to 30 percent on an average.

AWS REAL-TIME WEATHER INFORMATION

WEB PLATFORM

SHORTRANGE WEATHER FORECAST

EXPERT CROP SYSTEM SOFTWARE

DISEASE/ PEST FORECASTING

AGRI DOMAIN EXPERTISE

FARMER

REAL TIME CROP ADVISORY MODEL

Managing Climate Risk in Agriculture | 19

Major challenges in providing real time crop advisory to the farmers ? Farmer in a village grow more than 5 to 6 major crops ? Each crop has 4 to 6 major varieties. All of them are not sown together and their sowing period are also

different (sowing window is normally 30 to 45 days) ? POP is different for different varieties of a crop, depending on the time of their sowing. ? Impact of weather for the same crop at different stages will be different and therefore, POP also require

customization.

Solution Major factors that are required to be monitored for crops are temperature (both maximum and minimum), RH (Relative Humidity), rainfall, sunshine hours, wind speed and wind direction. One AWS (Automated Weather Station) if installed in a village can realistically cover 8000 hectares of land. If 40 percent of the land in a village is under cultivation then 3200 hectares of agriculture land can be covered and monitored on 24 hour basis. Crop mapping (crop growth stage along with major epochs) has to be done with the help of breeder, pathologist, entomologist and agronomist for every variety. Advisories have to be issued in case of deviation from ideal weather conditions at each specific crop stage. Software can be developed to integrate different crop epochs with ideal weather conditions and the same to be compared on dynamic basis from the live weather received from AWS. Thereafter, as per logic the given advisories can be sent automatically through software in the form of mail, SMS, voice messages and etc.

Advantages FARMERS ? Scheduling crop specific agronomic practices based on weather forecast ? Scheduling fertilizer and herbicide application ? Harvesting & post-harvest management advisories

COMPANY ? Planning & monitoring tool for seed production programs ? Better inventory/ logistics planning at District/ Taluka level (15 days to 3 months) ? Facilitate crop campaign planning ? Designing sales promotion strategies for quicker sales and low inventory carrying costs (ICC) ? Strengthening brand image for the company

| Knowledge Report 2016

REAL TIME CROP ADVISORY Paddy (Pusa Basmati 1121)

PERIOD

STAGE

IDEAL CONDITIONS

1 MAY Week 3 till JUN Week 2

33-40ºC

SOWING

sufficient

2 Jun Week 3 to Jul 10th

CURRENT WEATHER & FORECAST

35-38ºC

TRANSPLANTING 21-30 days after sowing

Sep Week 4 to Oct Week 1

PANICLE INITIATION

7-60 days after transplanting

4 35-90 days after transplanting

75%

sufficient, micronutrients required

33-35ºC

70%

FLOWERING STAGE 96-100 days after transplanting

sufficient

43ºC

7 111-120 days after transplanting

8 140-145 days after transplanting Temperature

CROP ADVISORY 1 Drain water from nursery and fill fresh water on daily basis

Delay transplanting by 7 days

60%

sufficient (most critical), nutrients required

29-32ºC

MATURITY

60%

sufficient (most critical), irrigate field based on wind speed else crop will fail

33-34ºC

MILKY STAGE

no rain/ moisture stress

2 31-34ºC

GRAIN FILLING 101-110 days after transplanting

Nov Week 2

70%

sufficient, special emphasis on fertilizers and micronutrients required

34-36ºC

Nov Week 1

60-70%

sufficient, special emphasis on weed control

32-33ºC

VEGETATIVE STAGE

Oct Fortnight 2

ACTUAL CONDITION

20%

Aug Week 4 to Sep 10th

Oct Fortnight 1

40-50%

60%

not required, harvest crop based on moisture

Relative Humidity

• Farmers • Sales employees • Marketing person • Retailers • Distribution person • Dealers • Seed production

Moisture

Managing Climate Risk in Agriculture | 21

ENVIRONMENT • Hourly observations • Specific geographies

CROP STAGE

PEST/ DISEASE

• GIS or UV mapping • Crop diagnostic

• Pest & disease infestation alert • Real time basis

Pest forecasting Model RISK MITIGATION TOOL FOR FARMER & PLANT PROTECTION INDUSTRY Weather plays an important role in the growing process of the crop as well as development of pests and diseases. Therefore, models based on weather parameters can provide reliable forecast for crop yield even before harvesting. They can also issue pest and disease attack warnings well in advance so that suitable plant protection measures could be taken up on time to protect the crops. Forecasting systems are based on assumptions of the pathogen's interactions with the host and environment, also known as the disease triangle. The objective is to accurately predict when the three factors - host, environment and pathogen - all interact in a fashion that disease can occur and cause economic losses. In most cases the host can be suitably defined as resistant or susceptible, and the presence of the pathogen may often be reasonably ascertained based on previous cropping history or perhaps survey data. The environment is usually the factor that controls or ascertains whether disease will develop or not. Environmental conditions may determine the presence of the pathogen in a particular season through their effects on processes such as overwintering. Environmental conditions also affect the ability of the pathogen to cause disease. For instance, minimum leaf wetness duration is required for grey leaf spots to occur in corn. In these cases a disease forecasting system attempts to define when the environment will be conducive for disease development.

PEST FORECASTING MODEL Example BPH (Brown Plant Hopper) in Paddy BPH LIFE CYCLE

Susceptible host

Paddy CROP STAGE INFORMATION

DISEASE MONITOR USING AWS

22 | Knowledge Report 2016

Conducive environment

BROWN PLANT HOPPER (BPH) Pathogen

Eggs hatchability highest at 25°C BPH population max 28-30°C RH > 70% High nitrogen levels

SOME BENEFITS - PLANT PROTECTION COMPANIES ? Predicts likely occurrence or attack of different pests and diseases ? Accurate advisories on prophylactic measures to prevent disease/ pest incidence ? Improve marketing activities and inventory planning at the dealer/ retail point ? Mobile advisories to suggest company’s products to farmers ? Increase revenue for the company ? Strengthen company’s brand image

PEST FORECASTING - MODEL This tool combines three parameters of disease triangle i.e. ? Host (Crop), ? Pathogen (present in the field) and ? Environment (which is monitored by AWS or Automated Weather Station)

Hourly data is sent by AWS from a geographical land based on crop stage in the area (which can be mapped through GIS mapping or UAV). Thereby, pest and disease forecasting is done on real time basis.

FEATURES ? Model can help in predicting likely occurrence or attack of BPH ? Provide advisories/ alerts on prophylactic measures to prevent disease/ pest incidence, to be sent to

farmers.

STEP I

STEP II

STEP III

STEP IV

STEP V

Crop & Geography Identification

Study Pests & Diseases of Identified Crop

Life Cycle Mapping of Disease/ Pest

Environmental Factors Triggering the Infestation

Monitoring Environment & Pest

(Biotic & Abiotic Factor)

STEP VI

Pest Forecasting Alerts Process Automation

PEST FORECASTING PROCESS

We believe that agriculture in India is highly under-computed. The ‘Internet of Things’ revolution is yet to hit. The industry has already started treading the path of technology with its services and over a period of time would like to integrate them to provide cutting edge information to farmers.

Managing Climate Risk in Agriculture | 23

Managing Crop Risk through New Technologies

Technology is omnipresent in our lives, right from the break of dawn to the moment we retire in our cool and comfortable bedroom mocking the sultry weather outside. Over the past few decades, technology has evolved by leaps and bounds, impacting everything from communication to entertainment, and medicine to convenience. Considering its diversified application in different fields of life, it is no surprise that technology not only makes life simpler but also helps save cost and improves efficiency. Agriculture has also not remained untouched from such productive changes. But in India the propagation of technology and its implementation at ground level is unsatisfactory. One of the reasons is possibly lack of awareness among farmers, who are not as literate and open to adoption of technologies as their counterparts in the Western world. We are currently living in the ‘information world’ where electronics, computers and mobile phones have changed the way we live, think and act. Nowadays, very precise information can be generated at extremely high frequency from remote areas. Moreover, it can also be processed, converted to actionable items or decision support systems. Need has always been felt for accurate estimation and forecast of crops’ health, likelihood of losses, total market arrivals, tentative price the produce would fetch in local Mandi or in the global market, etc. All stakeholders in the agriculture sector, including government bodies, agri-business officials, local traders and the farmer himself, have cited for this need. ‘Remote’ is one unique technology that has been put to its best use for the agriculture sector and has been largely able to cater to all information, sought by different sections of stakeholders. Satellite remote sensing captures information about different ground features while staying more than 400 kms above the ground. These satellites can take on board a variety of sensors to gather information. These have proved to be very useful in providing fairly accurate data in a very short time on sowing trends, acreages of different crops, stresses on crops during mid-season and areas affected due to this, harvesting trends, yield and production estimates. Collating and compiling such information would otherwise take months together using traditional methods. In India, Kharif is the main cropping season aided by the Monsoon rains. While it is a boon for crops,

26 | Knowledge Report 2016

MULTIPLE SATELLITES CONSTELLATION

remote sensing technology finds it challenging to gather information below cloud cover. In last few years, a unique method of capturing images has helped in overcoming this challenge to a great extent. This is by constellation of multiple satellites that can revisit the same area in a very short time, i.e., in about 2 to 5 days. This has significantly improved the capability of getting high resolution cloud free images of the ground. Termed as ‘Nano-Satellites’, these are constellation of very small satellites, of the size of a shoe box and weigh only 4 to 5 kgs. There are already hundreds of them in the sky, delivering usable data for different applications including agriculture. Another way of overcoming the challenge of cloud cover is to fly below clouds. This is possible either through traditional Aerial Photography or a handier and easily usable technology of UAVs (unmanned aerial vehicles). They fly very close to the ground (few 100 meters) and can collect very valuable crop related information, which can be readily used by farmers and others. This is particularly useful in crop field specific studies.

NANO-SATELLITES (TINY SIZE AND LIGHT WEIGHT)

This UAV or DRONE (Dynamic Remotely Operated Navigation Equipment) technology has caught attention of large farmers, crop insurance stakeholders and the government because it can provide ‘farmspecific’ information on crop condition, estimating losses to farmers and in reaching the right kind of benefits to the right people.

ROUND 1 FLYING Crop in early stage

Parcel captured with extracted information

ROUND 2 FLYING Crop matured

BG IR imagery

MULTI-DATE AND MULTI-SPECTRAL IMAGES FROM DRONE PLATFORMS, CAN BE OVERLAID WITH GIS PARCEL MAP AND GOOGLE IMAGES.

Managing Climate Risk in Agriculture | 27

Live weather data at village level

Y Crop simulation model

Yields estimation

I E

Farm data collection

L D C

LAI* measurement using smart phone

Unmanned aerial vehicle (RGB + IR)

O Parcel data + farmer details + policy info

• Crop type discrimination • NDVI# calculation • LAI determination • Farmer-crop field correlation • Crop health

Parcel boundary extraction

R R E

Comparative assessment & report preparation

L A

Remote sensing satellite based yield estimation

• Crop type discrimination • NDVI# calculation

NDVI# slicing

T I O

Crop cutting experiments (CCE)

NDVI based smart CCE site selection

Conducting crop cutting experiments

*LAI Leaf Area Index # NDVI Normalized Difference Vegetation Index

INTEGRATED APPROACH OF NEW TECHNIQUES FOR BETTER YIELD FORECASTING The sensors that can be placed on board on any of these three platforms (regular satellite, nano-satellites and drones) are largely the same and can provide comparable information with varying level of details. While the medium resolution satellites score on their capabilities of covering large areas, the nanosatellites and drones boast of very detailed pictures of the ground. Precision farming is a localized form of applying technology to gain farm level output through efficient management. Drones have been in use in this domain for a long time now and have been helpful for high value ground crops like grapes. Multiple sensors like near-infrared, thermal and even hyperspectral sensors are used to find out if every area is receiving optimum irrigation and check for soil nutrition levels and its variation across fields. They also help to detect the spread of localized diseases and optimize fertilizer and insecticide quantity and spread. Yield estimation is another area where the use of technology is helping in more precise estimation than what had been possible earlier. Crop and variety specific simulation models have been developed by scientists, which if provided with accurate field inputs can approximate yield estimation over larger areas. Ideally, such models require the details of the soil and its nutrition levels along with farm management data including sowing date, planting density, row spacing, variety sown, timing and count irrigations applied. They also require the type, timing and volume of fertilizer applied. The models also take into account

FRUIT COUNTING THROUGH ADVANCED IMAGE PROCESSING TECHNIQUES KNOWN AS ‘IMAGE SEGMENTATION' AND 'MACHINE VISION’

28 | Knowledge Report 2016

weather parameters like temperature, rain, humidity and solar radiation, throughout the growing season. At Skymet, we have leveraged the large number of weather stationsâ&#x20AC;&#x2122; data available with us. We have also well utilized the consolidated local inputs through integrated use of smart phones and sensors mounted on drones along with cadastral information taken from government sources. These have been our input for advanced crop simulation models to arrive at very high accuracy yield data that can be adopted for large area studies while maintaining cost advantages. Horticulture yield estimation is a tricky subject and efforts are still on by various scientific agencies to reach a less field intensive and more accurate estimation of yield of plantation crops like, oranges, pomegranates, mango, etc. The techniques being used at present are image processing of field photographs to arrive at fruit count and then model the whole area; selection of representative trees for sampling through UAVs; Radio-frequency identification (RFID) based tagging of plants for monitoring; and weather and ground based inputs for yield estimation. These are turning out to be helpful in reaching better estimates.

AERIAL AND GROUND BASED RCVS (REMOTE CONTROLLED VEHICLES) FOR FARM MONITORING

Image processing application, whether captured from ground-based hand held cameras or by using a more innovative approach of capturing whole outer surface of trees through controlled UAV flying around specific tree, holds promising future. A wide range of machine vision applications have been proposed in the field of horticulture. These include weed identification to guide targeted spraying, fruit load estimation and autonomous harvesting. Very innovative techniques have been operationally tested but, as of now these are pretty much of academic interest only. One such technique involves tractors that can travel driverless up and down the rows of trees in an orchard. They are useful in observing its surroundings and developing a detailed 3D map that shows the position and condition of every tree, every fruit and every inch of the ground. They can also identify any disease or deficiencies in each tree and estimate the ripeness of each fruit and the condition of the soil. Thus, we can conclude that end to end solutions seem to be the need of the hour. We require equipment that can automatically handle operations like detecting health or disease issues, apply fertilizers and pesticides, water the soils, sweep, mow and so on. In India we are uniquely placed. We have the capability to develop and put to test all these tools and techniques. Secondly, we are blessed to have the vast expanse of agricultural land waiting for the next revolution to happen.

Managing Climate Risk in Agriculture | 29

Crop Insurance as a Risk Mitigating Tool

Crop insurance as a concept for risk management in agriculture has emerged in India since the turn of the twentieth century. From concept to implementation, it has evolved sporadically but continuously through the century and is still evolving in terms of scope, methodologies and practices. India is an agrarian country, where 650 million people or 58 percent of total Indian households are directly/ indirectly dependent on agriculture and contributes to 17 percent of the Indian Gross Domestic Product (GDP). Yet, crop production in India is dependent largely on weather and is severely impacted by its vagaries. Attack of pests and diseases is another story all together. These unpredictable and uncontrollable extraneous perils render Indian agriculture an extremely risky enterprise. It is here that crop insurance plays a pivotal role in anchoring a stable growth of the sector. The key stakeholders in crop insurance include state and government agencies, banks, insurers and farmers.

Crop Insurance

State and Government Agencies Banks Farmers Insurers

KEY STAKEHOLDERS IN CROP INSURANCE

32 | Knowledge Report 2016

Journey of Crop Insurance in India Crop insurance is seen as a de-risking mechanism and has been evolving for the past 31 years. The first avataar was Comprehensive Crop Insurance Scheme (CCIS) that was rolled out in 1985. It was followed by the Experimental Crop Insurance Scheme (ECIS) in 1997, the Pilot Scheme on Seed Crop Insurance (PSSCI) in 2000, the National Agriculture Insurance Scheme (NAIS) in 1999, the Farm Income Insurance Scheme (FIIS) in 2003, the Weather Based Crop Insurance Scheme (WBCIS) in 2007, and the National Crop Insurance Programme (NCIP) in 2013. Finally the Pradhan Mantri Fasal Bima Yojana (PMFBY) was launched in 2016. The success of these schemes has been spasmodic.

1985

Comprehensive Crop Insurance Scheme (CCIS)

1999

National Agriculture Insurance Scheme (NAIS)

THE SCHEMES THAT CLOSED BETWEEN 1985 – 2003

2007

Weather Based Crop Insurance Scheme (WBCIS)

2011

Modified National Agriculture Insurance Scheme (MNAIS)

2016

Pradhan Mantri Fasal Bima Yojana (PMFBY)

JOURNEY OF CROP INSURANCE IN INDIA SCHEME WISE Experimental Crop Insurance Scheme (ECIS) – 1997 Pilot Scheme on Seed Crop Insurance (PSSCI) – 2000 Farm Income Insurance Scheme (FIIS) - 2003

Managing Climate Risk in Agriculture | 33

Comprehensive Crop Insurance Scheme (CCIS) The Comprehensive Crop Insurance Scheme introduced in 1985 was in operation for almost a decade and half. The scheme was based on an area approach and the defined area could be a district, a block or any other contiguous area. The scheme was scrapped in 1997 due to its financial unviability.

ABOUT THE SCHEME Comprehensive Crop Insurance Scheme introduced in 1985 Operated for almost a decade and a half Scheme covered cereals, pulses and oilseeds States were free to choose whether to implement it or not CCIS compulsory for farmers taking loans for crop production Farmer insured for 100% of the loan Premiums and claim amounts shared by central and state government in the ratio of 2:1 Uniform premium rate for the whole country based on crop 50% subsidy for small and marginal farmers

PERFORMANCE DURING 1985-1998* Scheme Name CCIS

No. of farmers covered (crores)

Area Covered (crore hectare)

Sum Insured (crore Rupees)

Premium (crore Rupees)

Claim (crore Rupees)

7.6

12.8

24975

404

2319

*Figures obtained from â&#x20AC;&#x2DC;Report of the Committee to Review the Implementation of Crop Insurance Schemes in Indiaâ&#x20AC;&#x2122;, Ministry of Agriculture, Government of India, May 2014

STATUS : DISCONTINUED ? due to its financial unviability

34 | Knowledge Report 2016

National Agricultural Insurance Scheme (NAIS) The CCIS was replaced by the National Agriculture Insurance Scheme (NAIS). This is the original big daddy of crop insurance. It was functional from 1999 to 2015. It was considered to be an improvement over the CCIS, but it simply replaced one flawed scheme with another slightly less flawed one. This was a purely yield based scheme, administered exclusively through the Agriculture Insurance Company of India Limited (AICIL). In this scheme, the claim and in some cases the premium was subsidized (there was a 10 percent premium subsidy for small and marginal farmers). For instance if the AICIL collected Rs. 100 crores of farmers’ premium in a season from a state, and if the claim for the season was Rs. 500 crores, then only Rs. 100 crores were paid by AIC. Rest of Rs. 400 crores were equally shared by state and central governments. This scheme was a huge uncertain burden on the government. Just because claims in a particular season were uncertain, the governments could not plan the budget in advance. Moreover, the indemnity level was quite low at 60 percent. The National Agricultural Insurance Scheme insured about 15.5 million farmers by paying a premium of USD 250 million for a sum insured of USD 2.5 billion, as of 2015.

ABOUT THE SCHEME National Agricultural Insurance Scheme (NAIS) introduced in 1999 Scheme covered all crops where adequate yield data is available Farmer loan up to 150% of the value of average yield Improved pricing: ? Premium rates differs by crop and season for all crops other than annual commercial/ horticultural crops ? Annual commercial/ horticultural crops – Premium based on experience

PERFORMANCE DURING 1999-2012* Scheme Name NAIS

No. of farmers covered (crores)

Area Covered (crore hectare)

Sum Insured (crore Rupees)

Premium (crore Rupees)

Claim (crore Rupees)

20.37

30.7

283720

8458

27962

*Figures obtained from ‘Report of the Committee to Review the Implementation of Crop Insurance Schemes in India’, Ministry of Agriculture, Government of India, May 2014

STATUS : DISCONTINUED ? due to its financial unviability ? area unit size not small enough leading to heterogeneity in experience ? MNAIS introduced to address shortcomings

Managing Climate Risk in Agriculture | 35

Weather Based Crop Insurance Scheme (WBCIS) Weather insurance, as the name suggests, mitigates the financial loss due to adverse weather conditions like deficit rainfall, unseasonal rainfall, excess rainfall, rainy days, dry spell, dry days, relative humidity, high temperature (heat), low temperature (frost) and wind speed. These adverse weather events are mapped with monetary losses, from nominal loss to total cost of cultivation.

ABOUT THE SCHEME Weather Based Crop Insurance Scheme (WBCIS) introduced in 2007 Alternative to yield based insurance Protection against crop losses resulting from adverse weather conditions (rain/ temperature/ humidity, etc.) Based on an area approach Actuarial rates – capped at different levels for different crops

PERFORMANCE DURING 2007-2013* Scheme Name

No. of farmers covered (crores)

Area Covered (crore hectare)

Sum Insured (crore Rupees)

Premium (crore Rupees)

Claim (crore Rupees)

4.69

6.32

80951

7519

5286

WBCIS

*Figures obtained from ‘Report of the Committee to Review the Implementation of Crop Insurance Schemes in India’, Ministry of Agriculture, Government of India, May 2014

STATUS : IN FORCE ? Covers all crops ? Mandatory for loanees ? Up to 50% subsidy shared by centre and states for the premiums (depending on the P/SI slab) ? Index acts as proxy for yield ? Share of farmers insured under WBCIS (78% AIC, 20% ICICI LOMBARD, 2% IFFCO-TOKIO) ? Private insurers claims ratio all under 45%, AIC around 65% ? WBCIS – much faster claims settlement

36 | Knowledge Report 2016

Modified NAIS introduced (MNAIS) Modified NAIS was created to improve upon NAIS in 2010. In this scheme the indemnity level was improved. Three levels of indemnity namely, 90%, 80% and 70% corresponding to Low, Medium and High Risk areas respectively, were available for all crops. The criteria for deciding Low and High risk were determined by the implementing agency. In this scheme, the number of Crop Cutting Experiments (CCEs) was also increased. The farmer, state and central governments paid the premiums and the full claims’ responsibility was borne by the insurance companies. This scheme was also DISCONTINUED with the coming of the Pradhan Mantri Fasal Bima Yojana.

ABOUT THE SCHEME Modified NAIS introduced (MNAIS) as a pilot scheme in 2010 Improvements over NAIS ? Actual premium charged – subsidy up to 75% ? Premium subsidy shared equally by centre and state ? Claim liability on the insurance company ? Smaller unit of area (village/ village panchayat) ? Annual commercial/ horticultural crops – Premium based on experience

PERFORMANCE DURING 2010-2013* Scheme Name MNAIS

No. of farmers covered (crores)

Area Covered (crore hectare)

Sum Insured (crore Rupees)

Premium (crore Rupees)

Claim (crore Rupees)

0.46

0.47

11024

1088

864

*Figures obtained from ‘Report of the Committee to Review the Implementation of Crop Insurance Schemes in India’, Ministry of Agriculture, Government of India, May 2014

STATUS : DISCONTINUED ? with introduction of PMFBY

Managing Climate Risk in Agriculture | 37

National Crop Insurance Programme (NCIP) The government tried to combine both these policies in 2013 into an integrated programme. As in, MNAIS and WBCIS were merged. The idea was to increase the resolution of the policy.

ABOUT THE SCHEME National Crop Insurance Programme (NCIP) introduced in 2013 Essentially merged the two major schemes - MNAIS and WBCIS Encouragement from government to implement MNAIS at village/panchayat level Larger area for initial few years subject to approval States implementing village/panchayat level to be reimbursed CCE expenses up to a limit

STATUS : DISCONTINUED ? with introduction of PMFBY

38 | Knowledge Report 2016

Pradhan Mantri Fasal Bima Yojana (PMFBY) Pradhan Mantri Fasal Bima Yojana (PMFBY) is the new crop insurance scheme launched by central government. It will replace the existing two schemes namely, National Agricultural Insurance Scheme as well as Modified NAIS which have had some inherent drawbacks. The Prime Minister Crop Insurance Scheme aims to bring as many farmers as possible in the insurance ambit. The premium rates to be paid by the farmers have been reduced substantially so that more farmers are able to avail insurance cover against crop loss on account of natural calamities. This scheme aims to provide insurance coverage and financial support to the farmers in the event of failure of any of the notified crop as a result of natural calamities, pests and diseases. It will also stabilize the income of farmers to ensure their continuance in farming. Accordingly, farmers will be encouraged to adopt innovative and modern agricultural practices, ensuring flow of credit to the agriculture sector.

Farmersâ&#x20AC;&#x2122; contribution to premium reduced significantly Use of simple and smart technology through phones and remote sensing for quick estimation and early settlement of claims Multiple localized risks and post harvest losses taken into account to ensure that no farmer is alone in times of distress New scheme removes the previous capping on premium so that farmers get full sum insured

COMPULSORY COVERAGE The enrolment is compulsory for the farmers in the notified area who have a crop loan/ Kisan Credit Card (KCC) account. The government is also encouraging coverage of non-loanee farmers.

Risks to be covered Under this scheme, comprehensive risk insurance is provided to cover yield losses of standing crops due to non-preventable risks, such as natural fire and lightning; storm, hailstorm, cyclone, typhoon, tempest, hurricane, tornado, etc.; flood, inundation and landslide; drought, dry spells; pests and diseases etc.

Managing Climate Risk in Agriculture | 39

WIDENING AMBIT OF INSURANCE SCHEMES Area covered (%of farmland)

Subsidy by the centre (Rs. crore)

2015-16*

23*

3,100*

2016-17

5,700

2017-18

7,400

2018-19

8,800

Premium paid by farmer (% of insured value)

CURRENT

3.6-8

Under PMFBY

1.5

*under the two existing schemes; ^Equal contribution from states; All figures are estimates; Total farm land at present: 194 hectares

KHARIF

RABI

HORTICULTURE

Premium Rates The Actuarial Premium Rate (APR) would be charged under PMFBY by the Implementing Agency (IA). The scheme would be implemented by multiple insurance companies, all under the control of the Ministry of Agriculture & Farmers Welfare. The Agriculture Insurance Company of India (AIC) empaneled by the Ministry along with some private insurance companies will participate in the government sponsored agriculture/ crop insurance schemes. There will be one insurance company for a cluster of districts (approximately 20 districts). The premium rates will be monitored and not fixed by the Department of Agriculture, Cooperation & Farmers Welfare (DAC & FW) on the basis of Loss Cost (LC). This means that APR will be estimated on the basis of claims procured and damage incurred by the region during the preceding 10 similar crop seasons, Kharif or Rabi. Therefore, the premium to be paid for a crop in a more damage-prone area will be higher than a region which witnesses less damage due to weather and other varied issues. According to PMFBY, the premium will be 2% of the sum insured (SI) for Kharif season crops and 1.5% for Rabi season crops. The rates are also applicable for oilseeds. The premium rates for commercial crops like cotton and other horticultural crops will be 5% of the insurance sum assured. The government has also stressed on the use of technology to provide a strong insurance scheme to farmers and make the process efficient and fast. The difference between the premium paid by the farmers and the premium fixed by the insurance companies will be subsidized. The subsidy will be equally borne by central and the respective state government. The PMFBY is by far the best scheme. From a farmerâ&#x20AC;&#x2122;s perspective, this represents significant improvement over the existing Modified National Agricultural Insurance Scheme. The farmers paid as high as 15% of the sum insured as premium under the existing scheme. In case of catastrophic losses, the insurance companies will be liable to pay 350% of total premium collected or 35% of total Sum Insured (SI),whichever is higher. The losses beyond this ceiling will be met by equal contribution from the central government and the concerned state government.

40 | Knowledge Report 2016

Use of Mobile Phone Technology to improve Yield-data Quality & Timeliness Over the years it has been felt that the process of Crop Cutting Experiments (CCEs), conducted for estimating yield, lacks in reliability and speed. This adversely affects the claims settlement. There is an urgent need to have good quality, timely and reliable yield-data. This problem can be solved by using video/ image of crops at various stages of their growth. These images can be transferred with CCE data on a real time basis with the help of mobile phones enabled with GPS time stamping. This will improve data quality, timeliness and also make claim processing and payments faster. Henceforth, states and insurance companies are being encouraged to utilise mobile technology. The cost of which will be once again equally shared between central government and the respective state/ UT governments.

Technology can be helpful to reduce the time taken to collect, collate and reconcile data

Loan Disbursal Stage – Use of land records from digital database

Crop Cutting Experiments – Using remote sensing Weather data information in real time

Assessment of prevented Sowing At times, due to adverse weather conditions, majority of the insured farmers of a notified area are prevented from sowing/ planting the insured crop. It’s possible that the farmers have already incurred a good amount of expenditure for the purpose. Such farmers shall be eligible for indemnity claims up to a maximum of 25% of the sum-insured. The insurance coverage shall cease to operate for the crop in the notified area. The cover is available during Kharif season for recognised rain-fed areas and crops.

Post-Harvest Loss Assessment Loss assessment and indemnity procedures in case of occurrence of post-harvest loss shall be for a cluster of affected farms or affected villages. The settlement of claims, if any, will be for each insured farmer covered under assessment. For this coverage is available up to a maximum period of 14 days from the day of harvesting of the crops, kept in “cut & spread” condition to dry in the field after harvesting, against specific perils of cyclone/ cyclonic rains and unseasonal rains throughout the country.

Managing Climate Risk in Agriculture | 41

Use of Innovative Technology The integrity of CCEs will be verified by using GPRS enabled Mobile phones with cameras. These phones will also help in addressing the problem of area discrepancy by capturing pictures of standing crops and will also help in quicker and accurate estimation of yields. All state government shall use technology initiatives in the conduct and supervision of CCEs. The state governments shall also use technology initiatives in the reporting of loss reports for on-account claim settlement, claim intimations for localized calamity and post-harvest losses.

DIFFERENCES BETWEEN EARLIER SCHEMES AND THE PMFBY Features

NAIS

MNAIS

PM Crop Insurance Scheme

Premium rate

Low

High

Lower than NAIS

Insurance amount cover

Full

Capped

Full

On A/c payment

Yes

Localized risk coverage

Hailstorm, landslide

Hailstorm, landslide, innundation

Post-harvest

For coastal regions only

All India

Prevented sowing coverage

Yes

Use of technology

Intended

Mandatory

Awareness

Low

Target to cover 50%

NAIS: National Agriculture Insurance Scheme; MNAIS; Modified National Agriculture Insurance Scheme

Source : Ministry of Agriculture

Weather Based Crop Insurance Scheme (WBCIS) The PMFBY also changed the structure of the WBCIS. The structure of farmerâ&#x20AC;&#x2122;s premium under WBCIS will be at par with the proposed PMFBY. Also, the criteria of selection of Implementing Agency and area allocation will be same as PMFBY. The rate of insurance charges payable by the farmer will be as per the following:

Maximum Insurance charges payable by farmer (% of Sum Insured) 1. Kharif food and Oilseed crops (all cereals, millets and pulses) 2.0% of SI or Actuarial rate, whichever is less 2. Rabi food and Oilseed crops (all cereals, millets and pulses) 1.5% of SI or Actuarial rate, whichever is less 3. Kharif and Rabi Annual Commercial/ Annual Horticultural crops 5% of SI or Actuarial rate, whichever is less

| Knowledge Report 2016

Unified Package Insurance Scheme (UPIS) The Unified Package Insurance Scheme (UPIS) aims at providing financial protection to citizens associated with the agriculture sector. Thereby, it ensures food security, crop diversification, enhances growth and competitiveness of agriculture sector besides protecting farmers from financial risks.

SALIENT FEATURES AND BENEFITS: The UPIS contains the same features as the PMFBY with 7 additionally sections.

Section 1- Crop Insurance The state can choose between any of the two crop insurance scheme - PMFBY and WBCIS.

Section 2 - Building and Content Insurance (Fire and allied perils) The indemnity under this section is based on declared sum insured (first loss basis). The company will indemnify the insured in respect to loss of or damage to the contents whilst contained in the insured premises by: a) Fire, lighting, explosion of gas in domestic appliances, b) Bursting and overflowing of water tanks, apparatus or pipes, c) Aircraft or articles dropped therefrom, d) Riot, strike, or malicious act, e) Earthquake, (fire and/ or shock) subsidence and landslide (including rockslide) damage f) Flood, inundation, storm, tempest, typhoon, hurricane, tornado or cyclone g) Impact damage

Section 3 - Personal Accident Insurance Coverage will be as per the Pradhan Mantri Suraksha Bima Yojana

Section 4 - Agriculture Pump Sets Insurance Scheme (Up to 10 Horsepower) The insurance covers the centrifugal pump sets (electrical and diesel) up to 10 Horsepower capacity, which are used for agricultural purposes only. The scope of cover include damage by fire and lightning; burglary due to violent forcible entry, provided the pump set is kept in a locked enclosure; mechanical or electrical damage; and damage due to riots, strikes and other malicious ways.

Section 5 - Agricultural Tractor Insurance Insurance will be provided as per the provisions, terms, exceptions, conditions and endorsements of the standard Motor Policy.

Managing Climate Risk in Agriculture | 43

Section 6 - Student Safety Insurance The schedule of benefits for Parent/ Student will be as follows: a) Accidental death: Rs. 50000 (parent/student) b) Permanent total disablement: Rs. 50000 (student) c) Loss of one limb/eye: Rs. 25000 (student) d) Accidental hospitalization: Rs. 5000 (student) In case of death of father or mother, the claim amount to be converted into FD in the name of student till attainment of adulthood.

Section 7 - Life Insurance As per the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) the benefits include death cover of Rs. 2,00,000 per member. On a concluding note we can say that the Narendra Modi governmentâ&#x20AC;&#x2122;s new Pradhan Mantri Fasal Bima Yojana (PMFBY) is a commendable feat aimed at allowing crop insurance to take centre-stage. PMFBY is bold because it has reduced the subsidy of farmers to almost zero.

PMFBY is bold because it has reduced the subsidy of farmers to almost zero.

44| Knowledge Report 2016

Way Forward ... “Way forward” is an often used term to denote corporate action. For some reason the human mind is perennially thinking that the future will always be better. But when we deal with climate change, we are looking for a step backward. At a time when droughts were fewer, Monsoon was abundant, crop failure was rare and water was less of a problem, we were assured that if our summer crop failed the winter crop would pull through. Climate change has hit India like a brick. Our Monsoons are failing often, food production is negative. Farmer suicides are our single biggest problem. Since 1999, around 3,00,000 farmers have killed themselves. For a country that launches satellites to Mars this is a matter of national shame. Today nine states are reeling under drought. And India has seen two (2014, 2015) back-to-back droughts. We are staring at a prospect of a perpetual El Niño, i.e., an El Niño event almost every second or third year. This has also raised the probability of a drought every other year. Some studies state that this might go on for at least a decade. In desperation we are seeking a “way backward.” But there is none. Can we cool the Earth by reducing carbon footprint? The answer is we don’t know, even if we can, we don’t know how much time it will take. On a more general note India has to find surpluses in conservation not consumption. We can’t afford a Western economic model. But on a more tactical note we need to use the impact of climate change against itself. First, we need to measure everything, weather, water, land, crops, forests, livestock, etc. So that we have better understanding of our risks and build predictive models. Second, transfer India’s drought risk through insurance and reinsurance to the global catastrophic risk market. An El Niño induced drought in India reduces the risk of hurricanes in the Atlantic; reduces the risk of drought in the US West Coast, Japan and China; and increases the risk of floods in Tamil Nadu in the Northeast Monsoon. So theoretically, pools of risk premiums can be collected in less vulnerable areas and redistributed where money is needed most, without creating fiscal hole for the government. This is the only choice we have. And governments, markets, scientists and companies have to work together to make this work. And we have to, because at the risk of repeating myself, this is the only option we have. Jatin Singh CEO, Skymet Weather Services Pvt. Ltd.

Skymet is India's largest weather monitoring and agriculture risk solutions company. We are experts in measuring, predicting and limiting climate risk in agriculture, disaster management and energy.

skymetweather.com

Backed by Omnivore Partners - a venture fund in agri-tech startups in India and DMGI, a global B2B information company.

Strengths

Services

Captive network of 3000+ ?

Weather forecasting & monitoring

Automatic Weather Stations (AWS) ? Remote Sensing & GIS expertise ? In house crop monitoring & Yield

modeling team ? Expertises in crop yield forecasting

& risk management ? Strong network of 200+ field staff

in all major states

24/48 hour weather forecast ? ? Short term (3-day) precipitation forecast at village level ? Medium term (15-day) precipitation forecast ? Seasonal & Monsoon forecast

Crop Monitoring ? Agro advisory models on real time basis ? Pest forecasting ? Crop health monitoring through UAV's (Unmanned Aerial Vehicles)

? Farmer usage based distribution models

Agriculture Risk Management Solutions ? Remote sensing based crop acreage estimation (95%

Skymet AWS Network

accuracy levels)

? Field level crop health validation survey ? Production estimations based on yield models & CCE (crop cutting experiments)

? Risk mitigation for Agri input companies through "Weather derivative based innovative" solutions

Agriculture Services ? Agri credit risk assessment tool for hedging agri lending/credit risks at district level

? Agri inputs planning tool for strategic planning & AWS

distribution

? Innovative distribution and marketing models for seeds, fertilizers & agrochemicals sectors

Crop Insurance Solutions

DELHI NCR

Skymet Weather Services Pvt. Ltd. www.skymetweather.com

HEAD OFFICE

Plot No. 10 & 11, GYS Heights, Sector 125, Noida 201303 INDIA

MUMBAI Cyber One Tower, Plot No. 4 & 6, Sector 30A, Vashi Navi Mumbai 400703 INDIA

Managing Climate Risk in Agriculture APRIL 2016 AUTHORS

SKYMET WEATHER SERVICES PVT. LTD.

Supported by

ASSOCHAM for industry information

Aided by

USAID

COPYRIGHT No part of this publication may be reproduced in any form by photo, photoprint, microfilm or any other means without the written permission of SKYMET WEATHER SERVICES PVT. LTD., ASSOCHAM and USAID.

DISCLAIMER This report is the publication of SKYMET WEATHER SERVICES PVT. LTD. ("SKYMET") and ASSOCHAM, so SKYMET and ASSOCHAM have editorial control over the content, including opinions, advice, statements, services, offers etc., that is represented in this report. However, SKYMET and ASSOCHAM will not be liable for any loss or damage caused by the reader's reliance on information obtained through this report. This report may contain third party contents and third-party resources. SKYMET and ASSOCHAM take no responsibility for third party content, advertisements or third party applications that are printed on or through this report, nor does it take any responsibility for the goods or services provided by its advertisers or for any error, omission, deletion, defect, theft or destruction or unauthorized access to, or alteration of, any user communication. Further, SKYMET and ASSOCHAM do not assume any responsibility or liability for any loss or damage, including personal injury or death, resulting from use of this report or from any content for communications or materials available on this report. The contents are provided for your reference only. The reader/ buyer understands that except for the information, products and services clearly identified as being supplied by SKYMET and ASSOCHAM, it does not operate, control or endorse any information, products, or services appearing in the report in any way. All other information, products and services offered through the report are offered by third parties, which are not affiliated in any manner to SKYMET and ASSOCHAM. The reader/ buyer hereby disclaims and waives any right and/ or claim, they may have against SKYMET and ASSOCHAM with respect to third party products and services. All materials provided in the report is provided on "As is" basis and SKYMET and ASSOCHAM make no representation or warranty, express or implied, including, but not limited to, warranties of merchantability, fitness for a particular purpose, title or non - infringement. As to documents, content, graphics published in the report, SKYMET and ASSOCHAM make no representation or warranty that the contents of such documents, articles are free from error or suitable for any purpose; nor that the implementation of such contents will not infringe any third party patents, copyrights, trademarks or other rights. In no event shall SKYMET and ASSOCHAM or its content providers be liable for any damages whatsoever, whether direct, indirect, special, consequential and/ or incidental, including without limitation, damages arising from loss of data or information, loss of profits, business interruption, or arising from the access and/ or use or inability to access and/ or use content and/ or any services available in this report, even if SKYMET and ASSOCHAM are advised of the possibility of such loss. This study has been done basis a pre decided scope of work between SKYMET and ASSOCHAM with the objective of achieving specified outcome and does not cover all aspects/ all opportunities pertaining to the cold chain sector in India.

CONTACTS SKYMET WEATHER SERVICES PVT. LTD. Plot no. 10 & 11, GYS Heights Sector 125, Noida 201303 INDIA Phone: +91 120 409 4500 Fax: +91 120 409 4508 E-mail: info@skymetweather.com Website: www.skymetweather.com

ASSOCHAM 5, Sardar Patel Marg, Chanakya Puri, New Delhi 110 021 INDIA Phone: +91 11 4655 0555 (Hunting Line) Fax: +91 11 2301 7008, 2301 7009 E-mail: assocham@nic.in Website: www.assocham.org

KNOWLEDGE REPORT 2016

Managing Climate Risk in Agriculture SKYMET WEATHER SERVICES PVT. LTD. Plot no. 10 & 11, GYS Heights Sector 125, Noida 201303 INDIA T +91 120 409 4500 F +91 120 409 4508 E info@skymetweather.com www.skymetweather.com

ASSOCHAM 5, Sardar Patel Marg, Chanakya Puri, New Delhi 110 021 INDIA T +91 11 4655 0555 (Hunting Line) F +91 11 2301 7008, 2301 7009 E assocham@nic.in www.assocham.org

visionVIBES