IN A MAJOR BOOST for the dairy sector, Finance Minister Arun Jaitley announced the setting up of a dairy processing fund with a corpus of 8,000 crore for three years. For the first year, 2,000 crore has been allocated to the corpus. This is the first time since the White Revolution that the government has brought in such a reform for the sector.
The creation of the ` 8,000-crore fund for dairy processing and infrastructure development by National Bank for Agriculture and Rural Development (NABARD) would facilitate financing of milk processing capacities, there by helping enhance production of milk.
According to Mr. R.S. Sodhi, MD, GCMMF, “The decision would enable India to produce 500,000 litres per day of additional milk with an estimated ` 50,000 crore cash flow to the farmers’ hand”.
According to Mr. Dilip Rath, Chairman, National Dairy Development Board (NDDB), thousands of dairies and
cooperatives at the village, district and state levels, which were formed around 30 years back, required funds to grow their businesses. This would lead to enhancement of milk processing capacities of dairy cooperatives which had stagnated for last many years.
According to Mr. Harsh Kumar Bhanwala, Chairman, NABARD, “the allocation for dairy will allow NABARD
to finance modernization of milk processing units, encourage new bulk milk cooling units, improve milk production and productivity and promote clean milk production.”
Officials from Department of Animal Husbandry said that with the exception of big state cooperatives like
GCMMF and Karnataka Cooperative Milk Producers’ Federation the others do not have enough financial strength to expand processing capacities. Out of the total annual milk production of 160 million tonnes, around 50% is marketed. Cooperatives and private sector have a share of 50% of the marketable surplus and the rest is sold by unorganized sector players. The move for this special dairy fund will strengthen India’s numero uno position as the world’s largest milk producer.
Organised players in the country, including dairy co-operatives and private players, currently have capacity to process an estimated 10 crore litres (1,000 lakh litres) of milk per day. Of these, the dairy co-operatives alone had a capacity of 668 lakh litres per day as on March 2016, according to NDDB sources.
