Government loans for the dairy and livestock sector under various schemes

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Dairy farm

Dairy products and livestock is an unorganized sector in India and a major source of income in rural areas. In order to structure the dairy industry and help the creation of dairy farms, the government grants loans with interest subsidy through the following mechanisms for the promotion and development of the dairy and livestock sector through the country :

Livestock Infrastructure Development Fund (AHIDF):

Under the AHIDF, the government grants a 3% interest subsidy to agricultural producer organizations, private enterprises, individual entrepreneurs, section 8 enterprises, micro, small and medium enterprises through the intermediary of the Bank from the first year and thereafter at the request of the bank for each of the beneficiaries each year on the amount outstanding.

Dairy Processing and Infrastructure Development Fund (DIDF):

Under the DIDF, loan aid with an interest subsidy of 2.5% per annum is provided through NABARD, NDDB and NCDC to Eligible Final Borrowing (EEB). Eligible End Borrowers (EEBs) under the DIDF are dairy cooperatives, state cooperative dairy federations, multi-state dairy cooperatives, milk production companies, NDDB subsidiaries, FPO / SHG registered in under the Cooperatives / Enterprises Act.

Support dairy cooperatives and organizations of agricultural producers carrying out dairy activities (SDC & FPO):

Under SDC & FPO, the working capital loan to dairy cooperatives / FPO is granted at a simple annual interest rate of 5%, calculated on a monthly basis. In addition, due to the economic impact of Covid-19 on the dairy sector, the government has introduced a new activity “Interest subsidy on working capital loans for the dairy sector” as a component of this program. . A 2% interest subsidy on the secured working capital loan is provided, including an additional 2% interest subsidy for prompt and timely repayment.

Government plans for the promotion of dairy and animal breeding:

  • Rashtriya Gokul Mission (RGM)

  • National Dairy Development Program (NPDD)

  • Dairy Processing and Infrastructure Development Fund (DIDF)

  • Support dairy cooperatives and agricultural producer organizations engaged in dairy activities (SDC & FPO)

  • National Livestock Mission (NLM)

  • Livestock Infrastructure Development Fund (AHIDF)

  • Livestock health and disease control (LH&DC)

  • National Animal Disease Control Program (NADCP)

In order to ensure increased credit flow in the form of Kisan Credit Card (KCC) to ranchers, dairy farmers and fisheries, as announced in Speech on the 2021-2022 budget of the Minister of Finance, a target of Rs 61,650 crores for livestock, dairy products and fisheries is set in the overall term loan target of Rs 6.85,000 crore for agriculture.

Source: FRP


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