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Present scenario:

Major strategies:

Logistics for exploiting business opportunities in dairy industry:

With an estimated 86.8 million tons of annual milk production from animals managed by nearly 70 million farmers, India is the top-most milk producing country in the world. The average annual growth is about 5.6%. The per capita milk availability is about 214 grams per day as against the recommended requirement of 250 grams. Milk is one of the most important item of common vegetarian diet of Indian people. With rapid industrialization, economic growth and 250 million potential economically strong domestic consumers of milk and milk products, there is a very strong potential for future growth of the industry.

Impressive work has been done under the guidance of the National Dairy Development Board under “ Operation Flood “ programmes for organizing dairy production, processing and marketing of milk and milk products by the cooperative dairy sector following the well known "Amul" model- a three tiered cooperative structure of village level dairy cooperative societies, a district level cooperative milk union and a state level cooperative milk marketing federation where the profits are shared by the farmer members.

The small rural milk producers have several problems. The major problems faced by the farmers include small herd strengths, small land holdings, shortages of green and dry fodder, low productivity of animals, non availability of timely inputs for breeding, feeding and health care of animals, lack of suitable education/training for skill development for new viable and sustainable technology, inadequate finances, poor rural infrastructure facilities and lack of proper marketing support for their produce.

In last 40-50 years, many development programmes have been taken up by the central and state Governments under the five year development plans.

The major thrust areas in the current Five Year Development Plan and the new livestock development policy laid by the Government include the following:-

Present scenario:

Some important issues of the Dairy industry are as under:-

Breeding of animals

Feed and fodder development:

Dairy cattle health:

Production and marketing of milk:

Institutional finance for Dairy Industry:

A separate data on ground level credit for dairy is not maintained by the banks. The figures mentioned below are for ground level credit disbursed by banks for Animal Husbandry Sector (Dairy, Poultry, sheep, goats pigs). However data on refinance disbursement by NABARD for dairy sector is maintained .The figures are as follows:-

In RS million







Ground level credit for A.H. sector






NABARD Refinance for Dairy






Source: NABARD Annual reports 2001-02 , 2002-3. NA*= Not available

These figures show that lending for small farmer programes has reduced but there is overall increase in bank loans provided for the Dairy Sector.

A recent dairy sector study conducted by NABARD have indicated that so far ,banks have disbursed loans mainly for the scheme for purchase of milch cattle. They need to diversify and provide loans for following important components of dairy business.

The NABARD Dairy sector study has also indicated the following major action points for improvement of Dairy Sector.

Major strategies:

The state government Department of Animal Husbandry will have to take a leading role in planning and providing logistic support for the following activities

Breeding and productive capacity of animals:

Fodder and feeding:

Dairy Cattle health:

Milk marketing:

Bank Credit:

Logistics for exploiting business opportunities in dairy industry:

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