Union Minister of Fisheries, Animal Husbandry and Dairying Giriraj Singh launched the Implementation Guidelines for Animal Husbandry Infrastructure Development Fund (AHIDF) worth Rs 15,000 crores which was approved by the Union Cabinet on 24 June 2020 under the Atmanirbhar Bharat Abhiyaan stimulus package for ensuring growth in several sectors. Union Minister of State for Fisheries, Animal Husbandry and Dairying Pratap Chandra Sarangi was also present on occasion.
Thanking prime minister Narendra Modi for announcing the Animal Husbandry Infrastructure Development fund (AHIDF), Singh said that India is engaged in breed improvement to increase milk production and, on the other hand, also taking care of the processing sector. India is producing milk of 188 million tons, and by 2024 the milk production is expected to rise to 330 million tons. Only 20-25% of milk comes under the processing sector, and the Government is trying to bring the same up to 40%.
He also informed that the Dairy Processing Infrastructure Development Fund (DIDF) is being implemented for infrastructure development in the cooperative sector. AHIDF is claimed to be the first type of scheme for the private sector. Millions of farmers will be benefited once the infrastructure is created, and more milk will be processed. This will also increase the export of dairy products, which is presently negligible. India needs to go up to the standards of countries like New Zealand in the Dairy sector. He expressed satisfaction that during the Covid-19 lockdown, dairy farmers could maintain a steady supply of milk to the consumers in the country.
Government’s initiatives for the dairy sector
The Government has been implementing several schemes for incentivizing the investment made by the cooperative dairy sector for the development of dairy infrastructure. The AHIDF has been set up as MSMEs, and private companies also need to be promoted and incentivized for their involvement in processing and value addition infrastructure. AHIDF would facilitate much-needed incentivization of investments in the establishment of such infrastructure for dairy and meat processing and value addition infrastructure and establishment of animal feed plant in the private sector.
The eligible beneficiaries under the scheme would be Farmer Producer Organizations (FPOs), MSMEs, section 8 companies, private companies, and individual entrepreneurs with a minimum 10% margin money contribution. The balance 90% would be the loan component to be made available by scheduled banks. The Government of India will provide 3% interest subvention to eligible beneficiaries. There will be two years moratorium period for the principal loan amount and six years repayment period thereafter.
Credit guarantee fund
The Government of India would also set up a credit guarantee fund of Rs 750 crore to be managed by NABARD. Credit guarantee would be provided to those sanctioned projects which are covered under MSME defined ceilings. Guarantee coverage would be up to 25% of the credit facility of the borrower. The beneficiaries intending to invest in establishing dairy and meat processing and value addition infrastructure or strengthening the existing infrastructure can apply for loans in the scheduled bank through the “Udyami Mitra” portal of SIDBI.
Investment through private sector
According to the press note, the Rs 15,000 crore AHIDF and the interest subvention scheme for private investors will ensure capital availability to meet upfront investment required for these projects and help enhance overall returns or payback for investors. Such investments in processing and value addition infrastructure by eligible beneficiaries would also promote the export of these processed and value-added commodities.
Since almost 50-60% of the final value of dairy output in India flows back to farmers, therefore, growth in this sector can have a significant direct impact on farmer’s income. The size of the dairy market and farmers’ realization from milk sales is closely linked with the development of organized off-take by cooperative and private dairies. Thus, investment incentivization in AHIDF would leverage seven times private investment and motivate farmers to invest more on inputs, thereby driving higher productivity, leading to an increase in farmers’ incomes. The measures approved through AHIDF would also help in direct and indirect livelihood creation for 35 lakh persons.
Union Minister of State for Fisheries, Animal Husbandry and Dairying Shri Pratap Chandra Sarangi said that Government has decided to vaccinate 53.5 crore animals and four crore animals have already been vaccinated. Breed improvement is taking place through technology intervention. However, we are lagging in processing sector. Using the AHIDF, processing plants can be established for fodder also. This will help in doubling farmers’ incomes and also contribute to achieving hon’ble prime minister’s dream of a 5 trillion dollar economy.