Lok Sabha Question No. 2459 (UNSTARRED), answered on 2024-12-10
Subject: Condition of Dairy Farmers in Kerala
Ministry: FISHERIES, ANIMAL HUSBANDRY AND DAIRYING
Asked by: Shri Hibi Eden

## GOVERNMENT OF INDIA MINISTRY OF FISHERIES, ANIMAL HUSBANDRY AND DAIRYING DEPARTMENT OF ANIMAL HUSBANDRY AND DAIRYING

## LOK SABHA

UNSTARRED QUESTION NO.2459

TO BE ANSWERED ON 10 TH  DECEMBER 2024

## CONDITION OF DAIRY FARMERS IN KERALA

## 2459. SHRI HIBI EDEN

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

be pleased to state:

- (a) the details of steps the Government is taking to ensure that dairy farmers in Kerala receive fair prices for their milk and milk products;
- (b) whether the Government considered introducing subsidies or financial support programs to aid small-scale dairy farmers struggling with economic viability, if so, the details thereof;
- (c)  the  details  of  any  plans  to  set  up  special  loan  schemes  for  dairy  farmers  to  help  them purchase modern equipment and improve milk production; and
- (d) the details of the Government considering any measures to exempt small-scale dairy farmers in Kerala from paying GST on their milk and milk products, in order to reduce their financial burden ?

## ANSWER

## THE MINISTER FOR FISHERIES, ANIMAL HUSBANDRY AND DAIRYING

## (SHRI RAJIV RANJAN SINGH ALIAS LALAN SINGH)

- (a) &  (b)  Department  of  Animal  Husbandry  &  Dairying  (DAHD),  GoI  is  DAHD  is implementing the following Dairy Development schemes across the country including Kerala  to complement and supplement the efforts for milk production and milk processing infrastructure made by the State Government:
- (i) National Programme for Dairy Development (NPDD)
- (ii) Supporting Dairy Cooperatives & Farmer Producer Organisations engaged in dairy activities (SDCFPO)
- (iii) Animal Husbandry Infrastructure Development Fund (AHIDF)
- (iv) RashtriyaGokul Mission (RGM)
- (v) National Livestock Mission (NLM)
- (vi) Livestock Health and Disease Control Programme (LHDCP)

These schemes are helping in improving milk productivity of bovines, strengthening of dairy infrastructure,  enhancing  availability  of  feed  and  fodder  and  providing  animal  health  services.

These interventions help to reduce the cost of milk production and thereby help to stabilize milk prices and also help to enhance income from dairy farming.

Department  of  Agriculture  &  Farmers  Welfare,  Government  of  India  is  providing  financial support  to  small-scale  dairy  farmers  by  promoting  entrepreneurship  in  the  dairying  sector through Formation and Promotion of 10,000 FPOs' scheme. Under this scheme Department of Animal  husbandry  and  dairying  is  forming  and  promoting  100  Fodder  Plus  Farmer  Producer Organizations (FPOs) through National Dairy Development Board. A total of 100 Fodder Plus FPOs have been allocated across 65 agencies (Cluster Based Business Organisation-(CBBOs) in 19  states.  The  scheme  provisions  include  financial  support  of  Rs.  25  Lakh  per  FPO  to  each CBBO over five years for formation and incubation, and Rs. 18 Lakh per FPO as grants over three years for management support, including salaries, office setup, and expenses.

In  Kerala,  9  FPOs  have  already  been  registered.  These  FPOs  serve  as  local  business  hubs, encouraging  small  and  marginal  farmers  to  engage  in  commercial  fodder  production.  The initiative  seeks  to  support  dairy  farmers  and  fodder  growers  by  providing  a  stable  market  for their products, including green fodder, dry fodder, silage, and fodder seeds.

As informed by Government  of Kerala, they have introduced varies schemes namely Contingency fund, Fodder cultivation, Irrigation Assistance for Fodder cultivation, Mechanisation & Modernisation of Fodder plots,Extreme Poverty Alleviation Programme, 1 cow unit,  2  cow  unit  and  5  cow  unit,  Mechanisation  and  Modernisation  of  Dairy  Farm,  Milking Machine  Cattle  shed  Construction  to  provide  financial  support  to  small-scale  dairy  farmers struggling  with  economic  viability.  Kerala  Government  also  gives  technical  support  to  dairy farmers through dairy training centers which help them to rear cattle in a scientific manner.

(c  )  Department  of  Animal  Husbandry  and  Dairying,  Government  of  India  under  the  Atma Nirbhar Bharat stimulus package, has approved  the  continuation  of  Animal  Husbandry Infrastructure  Development  Fund  (AHIDF)  as  a  component  under  Infrastructure  Development Fund (IDF) subsuming Dairy Processing Infrastructure Development Fund (DIDF). The revised outlay of AHIDF is ₹29110.25 crores up to FY 2025-2026 till 31.03.2026. Under the AHIDF scheme,  interest  subvention  at  the  rate  of  3%  per  annum  is  being  provided  to  eligible beneficiaries namely individual entrepreneurs, Dairy Cooperatives, Farmers Producers Organizations, private companies, MSME, Section 8 companies and to establish dairy processing and value-added product infrastructure. Three projects has been approved in the State of Kerala wherein  the  Ernakulam  Regional  Co-operative  Milk  Producers'  Union  has  been  sanctioned  a project  to  enhance  the  manufacturing  of  dairy  Products  at  Edappally,  Kochi,  Kerala,  and establish a 2 MW solar power plant at the Tripunithura Dairy, Ernakulam with project outlay of Rs. 15.50 Crore financed by way of Loan of Rs. 12.20 Crore and End Borrowers Contribution of Rs.  3.05  Crore.  Another  2  projects  of  individual  entrepreneurs  have  been  approved  with  total project cost of Rs 1.96 Cr in which term loan is of Rs 1.52 Cr.

Government  of  Kerala  implementing  special  loan  schemes  that  support  dairy  farmers  to purchase modern equipment and improve milk production are as follows:

- (i) Project  Based  Bank  Interest  Subvention  Scheme  for  Establishing  Dairy  Farms  and Automation/Modernization of Existing Dairy Farms.
- (ii) Scheme component is implemented in bank interest subvention mode for establishing dairy farms, improving existing infrastructure of dairy farm Automation/Mechanization  of  dairy farm, establishing cattle feed mixing  and compounding  units,  TMR  unit  silage  making  units,  commercial  fodder  cultivation establishing for cold chain maintenance, value addition products of milk etc.
- (iii) The  beneficiaries  shall  be  individual  farmers,  entrepreneurs  SHG's,  JLG's,  other registered groups etc. The term of loan availed from the bank for the above purpose shall not be less than five  years. The maximum interest subvention amount is Rs 3 lakh per year.
- (iv) all  the  commercial  dairy  unit  (10  cow  units,  20  cow  units,  heifer  park  etc.)  are implemented as loan linked schemes.

(d)  No such proposal has been received from Kerala Government. However. the Government has taken the following steps to provide relief to the Cooperative Societies under Income Tax Act:

- i. A  primary  cooperative  society  engaged  in  supplying  of  milk  to  the  Federal Cooperative Society is eligible to  claim deduction in respect of its  entire profit relating to supply of milk to Unions society u/s 80P of the Income Tax Act, 1961.
- ii. The  surcharge  on  co-operative  societies  has  been  reduced  from  12%  to  7%  on income of more than ₹1 crore and up to ₹10 crores
- iii. The rate of Alternate Minimum Tax for the cooperative societies have also been reduced from 18.5% to 15% for cooperative societies at par with companies.
- iv. Section 269SS and 269T of the Income Tax Act has been amended to provide that where a deposit is accepted by a Primary Agricultural Credit Society (PACS) or a loan is taken from a PACS by its member in cash, no penal consequence would arise, if the amount of such loan or deposit including their outstanding balance is less than ₹2 lakh.