Action Plan to Promote Dairy Industry

by Sep 16, 2021Agriculture0 comments

The Government of India had launched Animal Husbandry and Infrastructure Development Fund (AHIDF) in 2020 with an outlay of Rs. 15,000 Cr and Dairy Processing Infrastructure Development Fund (DIDF) in 2017 with an outlay of Rs. 11,184 Cr as a part of Atmanirbhar Bharat package stimulus.

In 2020, as a part of Prime Minister Narendra Modi’s Atma Nirbhar Bharat Abhiyan, Rs 8000 Cr has been earmarked for assisting milk processing and product plants under AHIDF for implementation during 2020-2021 and 2022-2023 with objective of increasing of milk processing infrastructure, to provide greater access for unorganized rural milk producers, make available protein enriched quality milk products, develop entrepreneurship and promote exports.

The eligible beneficiaries of the scheme are Farmer Producer Organization (FPO), Private companies, Individual entrepreneurs, Section 8 companies, Micro Small and Medium Enterprises.

Under the scheme, the Schedule bank will provide loan to the eligible beneficiaries up to 90% with the commitment of minimum 10%. The Central Government provide interest subvention @3% and also credit guarantee to those beneficiaries covered under MSME defined ceilings. The maximum repayment period is 10 years including 2 years moratorium period.

DIDF was launched in 2017-2018 with the objective of creating/ strengthening of Milk Processing, Value addition & chilling facilities for implementation up to 2022- 2023. The eligible beneficiaries of the scheme are Dairy Co-operative, Multi State Dairy Cooperative, Milk Producer Companies (MPC), National Dairy Development Board (NDDB) subsidiaries, Self Help Groups (SHGs) and Farmer Producer Organizations (FPOs) registered under Cooperative and Companies Act.

Under the scheme, National Bank for Agriculture and Rural Development (NABARD)/ National Dairy Development Board (NDDB)/ National Cooperative Development Corporation (NCDC) provide loan (Rs. 8004 Cr) to the eligible beneficiaries.

The Government provides loans with interest subvention through the following schemes for promotion and development of dairy and animal husbandry sector across the country:

(i) Animal Husbandry Infrastructure Development Fund (AHIDF)

(ii) Dairy Processing and Infrastructure Development Fund (DIDF)

(iii) Supporting Dairy Cooperatives snd Farmer Producer organizations engaged in dairy activities (SDC & FPO)

Under AHIDF, the Government provides 3% interest subvention to Farmer Producer Organisation, Private companies, individual entrepreneurs, section 8 companies, Micro, Small and Medium Enterprises through the Bank upfront in the first year and subsequently on demand by the bank for each of the beneficiaries on each year on the outstanding amount.

Under DIDF, loan assistance with interest subvention @ 2.5% per annum is provided through NABARD, NDDB and NCDC to the Eligible End Borrows (EEBs). The Eligible End Borrower (EEBs) under DIDF are Co-operative Milk Unions,State Co-operative Milk Federations, Multi-state Milk Co-operatives, Milk Producer companies, NDDB Subsidiaries, FPO/SHGs registered under cooperatives/companies act.

Under SDC & FPO, loan towards working capital to dairy Cooperatives/FPOs is provided at simple annual interest rate of 5%, calculated on a monthly basis.

Further, due to Economic Impact of Covid-19 on Dairy Sector, the Government has introduced a new activity “interest subvention on Working capital loans for Dairy sector” as a component under this scheme.

This component is implemented by DAHD through NDDB. 2% interest subvention on secured working capital loan is provided including additional 2% interest subvention for prompt and timely repayment.

The details of the schemes being implemented by the Government to promote dairy and animal husbandry across the country are as under:

(i) Rashtriya Gokul Mission (RGM)

(ii) National Programme for Dairy Development (NPDD)

(iii) Dairy Processing and Infrastructure Development Fund (DIDF)

(iv) Supporting Dairy Cooperatives and Farmer Producer Organizations engaged in dairy activities (SDC & FPO)

(v) National Livestock Mission (NLM)

(vi) Animal Husbandry Infrastructure Development Fund (AHIDF)

(vii) Livestock Health & Disease Control (LH&DC)

(viii) National Animal Disease Control Programme (NADCP)

In order to ensure increased credit flow in the form of Kisan Credit Card(KCC) to animal husbandry, dairy & fisheries farmers as announced Finance Minister’s Budget Speech 2021-22, a target of Rs 61,650 crore for animal husbandry, dairy and fisheries is fixed within the overall term loan target of Rs 6,85,000 crore for agriculture.

It may be noted that National Dairy Plan Phase I (NDP-I) a Central Sector Scheme (CSS) with an outlay of Rs. 2242 Crore was implemented during March 2012 to Nov 2019 across 18 major dairying states including Gujarat. The objectives of NDP-I was as follows:

(i) Increase productivity of milch animals and thereby increase milk production to meet the rapidly growing demand for milk.

(ii) Provide rural milk producers with greater access to the organized milk processing sector.

NDP I had the following major components:

(i) Component A: Productivity Enhancement: This component aimed at increasing bovine productivity following a scientific approach in animal breeding and nutrition.

(ii) Component B: Village based milk procurement systems for weighing, testing quality of milk received and making payment to milk producers: This component aimed at increasing the number of milk producers organised into milk producer institutions through (i) mobilisation and institution building of small holder milk producers, (ii) training and capacity building of milk producers and other functionaries; and (iii) investment in village level infrastructure for milk collection and bulking.

(iii) Component C: Project Management and Learning: This component aimed at effective coordination of project activities among various EIAs and a comprehensive and functional Management Information System (MIS) for the Project through (i) Information and Communication Technology (ICT) based MIS and (ii) Learning & Evaluation.

The implementation of NDP I have established the fact that a scientifically planned integrated approach towards dairy development can indeed be successful in a large and diverse country like India. NDP I was able to make available more than 2,456 High Genetic Merit Bulls to A & B graded semen stations across the country which propelled the production of quality disease-free semen. The project also contributed towards lowering the cost of feeding per kg of milk resulting in increase of net daily income of milk producers by Rs 25.52. Market access was provided to more than 16.8 lakh additionally enrolled milk producers of which 7.65 lakh are women members.

The project covered around 59 lakh beneficiaries across 97,000 villages. Cooperative development initiatives under the NDP-I provided additional, reliable income for tribal dairy farmers and improved their overall socio-economic conditions – especially the marginalized and most vulnerable. More transparent procurement and payment under VBMPS led to better prices.

Under NDP-I, a study was conducted on Social inclusion impact of NDP I with regard to empowerment of Schedule Caste and Tribal population showed that the access of SC and ST communities to Dairy Cooperative Societies (DCS) enrolment and services of automated Milk Collection Units (AMCUs) were found not to be significantly different to that of non-SC/ST households. This implies that SC/ST Beneficiary households were provided access equal to that of non-SC/ST households to DCS enrolment and its services.

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