Lok Sabha Question No. 2500 (UNSTARRED), answered on 2019-07-09
Subject: Challenges Faced by the Dairy Industry
Ministry: FISHERIES, ANIMAL HUSBANDRY AND DAIRYING
Asked by: Sudhakar Tukaram Shrangre, Devji Mansingram Patel, Ram Kripal Yadav

## GOVERNMENT OF INDIA

## MINISTRY OF FISHERIES, ANIMAL HUSBANDRY AND DAIRYING DEPARTMENT OF ANIMAL HUSBANDRY AND DAIRYING LOK SABHA

UNSTARRED QUESTION NO. 2500 TO BE ANSWERED ON 9 TH  JULY, 2019

## CHALLENGES FACED BY THE DAIRY INDUSTRY

## 2500.   SHRI SUDHAKAR TUKARAM SHRANGARE:

SHRI DEVJI M. PATEL:

SHRI RAM KRIPAL YADAV:

## Will the Minister of FISHERIES, ANIMAL HUSBANDRY AND DAIRYING मत्स्यपालन , पशुपालन और डेयरी मंत्री

be pleased to state:

- a) whether the dairy industry is facing various problems such as higher taxes on dairy products, lack of  better  breeds  of  cows  and  buffaloes,  shortage  of  organized  dairy  farm  and  investment,  higher price of machines and equipment used in dairy farming and duty for imported dairy equipment;
- b) if  so,  the  details  of  the  action  plan  being  prepared  by  the  Government  for  promotion  of  the  said sector;
- c) whether the Government proposes to include dairy farming under the Corporate Social Responsibility  (CSR)  activities  to  address  these  problems  and  to  increase  investment  in  dairy sector; and
- d) if so, the details thereof?

## ANSWER

## THE MINISTER OF STATE FOR FISHERIES, ANIMAL HUSBANDRY AND DAIRYING (DR. SANJEEV KUMAR BALYAN)

(a)  As  per  Goods  and  Services  Tax  Act  2017,  the  current  rate  of  GST  applicable  on  dairy  products ranges  from  5%  to  18%.  Harmonized  System  (HS)  code-wise  details  of  GST  on  dairy  products  are given at Annexure. The Department has received representations from stakeholders like Indian Dairy Association  and  Gujarat  Cooperative  Milk  Marketing  Federation  Limited,  to  reduce  GST  on  some dairy  products  like  ghee,  butteroil  and  flavoured  milk  and  to  reduce  import  duty  on  some  dairy machinery.

Indian cattle and buffaloes have among the lowest productivity in the world. Similarly there is a shortage  of  organized  dairy  farms  and  there  is  a  need  of  high  degree  of  investment  to  take  dairy industry to global standards.

(b)  To  improve  low  productivity  of  indigenous  bovine  breeds,  Department  has  been  implementing Rashtriya Gokul Mission with aim of development and conservation of indigenous bovine breeds and enhancing  production  and  productivity  thereby  making  milk  production  more  remunerative  to  the farmers.

In order to promote organized dairy farming and investment, Department of Animal Husbandry And  Dairying,  Government  of  India  has  been  supplementing  the  efforts  of  State  Governments  by implementing  following  dairy  development  schemes  for  creation/  strengthening  of  infrastructure  for production of quality milk, procurement, processing and marketing of milk and milk products across the country:

- i. National Programme for Dairy Development (NPDD)
- ii. Dairy Entrepreneurship Development Scheme (DEDS)
- iii. National Dairy Plan-I (NDP-I)
- iv. Dairy Processing and Infrastructure Development Fund (DIDF)
- v. Supporting  Dairy  Cooperatives  and  Farmer  Producer  Organizations  engaged  in  dairy  activities (SDCFPO)

(c) & (d) No such proposal has been put forward by the Department to use CSR for dairy farming.

****

## Annexure

| S No.   | Present status of GST rate Schedule for Goods                                                                                                                                                                                                             | Present status of GST rate Schedule for Goods   |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------|
|         | Product name with HS Code                                                                                                                                                                                                                                 | GST rate                                        |
| 1.      | HS 0401: Fresh milk and pasteurised milk, including separated milk, milk and cream, not concentrated nor containing added sugar or other sweetening matter, excluding Ultra High Temperature (UHT) milk [0401]                                            | Nil                                             |
| 2.      | Ultra High Temperature (UHT) milk [0401]                                                                                                                                                                                                                  | 5%                                              |
| 3.      | HS 0402: Milk and cream, concentrated or containing added sugar or other sweetening matter including skimmed milk powder, milk food for babies, excluding condensed milk.                                                                                 | 5%                                              |
| 4.      | 0403: Cream, yogurt, kephir and other fermented or acidified milk and cream, whether or not concentrated or containing added sugar or other sweetening matter or flavoured or containing added fruit, nuts or cocoa.                                      | 5%                                              |
| 5.      | HS 0404: Whey, whether or not concentrated or containing added sugar or other sweetening matter; products consisting of natural milk constituents, whether or not containing added sugar or other sweetening matter, not elsewhere specified or included. | 5%                                              |
| 6.      | HS 0406: Chena or paneer put up in unit container and bearing a registered brand name                                                                                                                                                                     | 5%                                              |
| 7.      | HS 0405: Butter and other fats (ghee, butter oil, etc.) and oils derived from milk; dairy spreads                                                                                                                                                         | 12%                                             |
| 8.      | HS 0406: Cheese                                                                                                                                                                                                                                           | 12%                                             |
| 9.      | HS 2202 90 30: Flavoured Milk (Beverages containing milk)                                                                                                                                                                                                 | 12%                                             |
| 10.     | HS 2105: Ice cream and other edible ice, whether or not containing cocoa.                                                                                                                                                                                 | 12%                                             |
| 11.     | Condensed milk [04029110,04029920]                                                                                                                                                                                                                        | 18%                                             |