New Delhi, March 21 (IANS): Prime Minister Narendra Modi is set to meet senior officials of all banks and insurance companies in Mumbai on Tuesday to discuss the implementation of the government's crop insurance scheme, an official source said on Monday.

The finance ministry source said Finance Minister Arun Jaitley will also attend the meeting at the National Bank for Agriculture and Rural Development office along with officials of the finance and agriculture ministries.

The meeting will discuss ways to bring more loanee farmers under the 'Pradhan Mantri Fasal Beema Yojana' (PMFBY) so as to realise the target of 50 percent insurance coverage.

Of the farm credit target of Rs.8.5 lakh crore set for this fiscal, only Rs.75,000 crore is under crop insurance. 

Currently, only around 25 percent of the country's total crop area is covered by insurance.

Drought and unseasonal rains last year forced the state governments to seek over Rs.10,100 crore from the National Disaster Response Fund.

Under the new crop insurance scheme to be implemented from April 1 for kharif crops to be sown from June and available to both loanee and non-loanee farmers, the premium is a low two percent of sum insured for all kharif crops and 1.5 percent for all rabi crops.

For annual commercial and horticultural crops, farmers will have to pay a premium of 5 percent. The remaining premium share, as was the case with previous schemes, will be borne equally by the central and state governments. 

Addressing farmers at the Krishi Unnati Mela here on Saturday, Modi explained the benefits of PMFBY and said it had been evolved after wide-ranging consultations.

The 2016-17 budget has increased the allocation for agriculture, irrigation and rural infrastructure in order to help farmers cope with the impact of two successive years of poor rainfall.