Crop, Flood and Disaster Insurance Reap Rich Dividends

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With the BJP government at the centre completely sold on private money creation aka capitalism, it is highly unlikely that Bihar will ever see the Rs. 7636 crore required from the Centre to provide immediate relief to victims of the August 2017 flood catastrophes.

Originally the Indian nation was considered as one, a union and a unity, which would share the benefits of independence between all citizens and residents on the basis of fraternity, liberty and justice. Many institutions were founded to realise this dream, Global Insurance Corporation of India amongst them. Today GIC Re is about to be floated on the stock exchange, it increased its premiums collections to 33,585 crore in the last financial year on account of a special focus on crop insurance, and in 2016-2017 paid out a dividend of ?1,002 crore, 68% to domestic investors. 50% of its annual growth has been coming from crop insurance, which is to be extended to flood insurance for crops. The investors are obviously the rich, whilst those who pay premiums are the poor.

The principle of a capitalist insurance company is to make profits to pay out dividends, and it is very interested to minimise payouts. That is the nature of a capitalist business; and the purpose of a stock market is protecting the business profits of the investors.

A socialist insurance company owned by a Gram Panchayat branch of the Reserve Bank of India, with the power to create money for its own depositors, would spend enough insurance relief into circulation in its locality to finance the necessary holistic disaster risk mitigation projects without anyone sucking profits from the activities as rentiers.

But this model of money creation and use seems to be anathema to Hindutva forces whose Hindu Rashtra project probably would go nowhere without free market money interests to push it. After all the BJP manifesto specifically criticises the Indian National Congress for not going far enough on liberalisation and American educated masters of business administration BJP members are the drivers of the Hindu Rashtra agenda.

For the 10 million victims of the August 2017 floods this means that whatever small amounts of money the Bihar government agencies have collected from taxes and core central funding is probably going to be spent on consultants who will work with GIC Re, Bajaj Alliance, International Water Management Institute and other such global companies and their advisors to create so called inland flood software modelling tools that allow insurance companies to have the last say vis-à-vis the victim as to whether or not her field was really flooded. GIC Re currently has a global tender out asking for just such global catastrophe modelling software. Bihar in the eyes of the BJP is just another Costa Rica, with global so-called cat insurers vying for the business of catastrophe and disaster risk insurance.
The BJP government has already signalled in myriad of different forms that it is not interested in delivering on its promise to provide crop loan write off to agriculturists, let alone immediate money for victims of disaster in India, let alone the money for holistic disaster risk reduction projects. The scandal of 9 paisa cheques reaching cultivators in Uttar Pradesh from the Yogi Adityanath government is well documented. Instead the Narendra Modi government is organising for the rich to benefit from the plight of the poor by floating GIC Re to become the world's largest agriculture reinsurer on the back of the government's Fasal Bima Yojana.

With the Government of India and all the major political parties of the country in league with big banks and big business, Bihar’s flood victims have no chance of seeing any planning, let alone action on disaster risk reduction or disaster relief, except for what they can manage themselves. Instead of the Union government pouring fire and brimstone over global polluters who have ruined the stability of the atmospheric common, we have politicians in the pockets of a few hundred thousand capitalist shareowners selling not only the country’s silver on the stock exchange to the highest bidders but the very right to life of victims of global warming.

Such is the state of the country and the condition of the state of Bihar.

Anandi Sharan was born in Switzerland, lives in Bangalore, and worked in Araria District in 2016. She mainly writes about India and how we need a better money policy to help agricultural labourers and women especially to adapt to man-made climate change. 


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