PM Manmohan Singh for a mechanism to provide risk insurance

NEW DELHI: Prime Minister Manmohan Singh today favoured setting up of a mechanism to provide risk insurance and contingent credit facilities to people affected by disasters, saying such steps of immediate funding would reduce suffering of people after any calamity.

He said there was need for greater attention about arrangements for providing funds to people so that they are able to cope with the losses they suffer due to natural disasters.

"The current systems, particularly at the national level, lack institutional incentives and do not promote mechanisms such as risk insurance and contingent credit facilities. The development of such ex-ante arrangements is particularly important because they typically serve as a primary source of immediate funding that would reduce human suffering, economic losses and fiscal pressures in the aftermath of natural disasters," Singh said.

The Prime Minister said managing disasters was necessarily a collaborative and complex exercise, involving not only several departments of the government at the Centre but also state and local governments, civil society organisations, local communities and the people at large.

"I believe that while we have made encouraging progress in recent years in putting in place institutions and mechanisms for disaster prevention and mitigation, we have still a large distance to travel," he said, inaugurating the first session of National Platform for Disaster Risk Reduction.