The Union government will formally revive the shrimp crop insurance scheme, nearly three decades after it came to a halt. This is set to benefit lakhs of coastal shrimp farmers. Parshottam Rupala, Minister of State for Animal Husbandry, Dairying and Fisheries, will make a formal announcement regarding this in Gujarat on Thursday.

Public sector insurance firm Oriental Insurance Company Ltd has curated the insurance product for the government, with technical help from the Central Institute of Brackish-water Aquaculture. The estimated business is pegged at over Rs 1,000 crore.

The old shrimp crop insurance policy of Oriental was discontinued in 1995-96 following a widespread viral disease hit the industry and a huge number of farmers applied for claims. “Rupala will make an announcement on the participation of another public sector insurance company, National Insurance Company Limited, in the shrimp crop insurance scheme,” said a senior official close to the development.

Shrimp farming is labelled as a risky venture since crustaceans are prone to diseases such as white spot disease, white faeces syndrome, white tail disease, loose shell, slow growth and mortality syndromes. This makes the banking and insurance institutions tread cautiously.

Indian shrimp farming is dominated by small and marginal farmers. Over 1.5 lakh farmers, who individually own an average of 2-3 ponds each, are engaged in growing shrimp over approximately one million hectares. Farmers face huge obstacles in raising working capital, credit and insurance. But despite this, India had emerged as a major exporter of shrimp to the US and China.

Though India had seen about 430 per cent growth in shrimp production in the past decade, the COVID-19 pandemic has brought down the production to 6,50,000 MT. Subsequently, Ecuador replaced India in shrimp exports to China. “To take the growth further, the sector needs institutional support like insurance,” said the official.