Dairy Farming In Bihar, Loans, Subsidies, Schemes

Introduction to Dairy Farming in Bihar

The following information is about Dairy Farming In Bihar, dairy subsidies, Dairy bank loans, and schemes.

Bihar is an agriculturally rich state and has conditions that are conducive for milch animal rearing and dairy development. Bihar is one of India’s largest milk-producing states and accounts for 8.9 percent of the national milk production. However, milk availability (170 g/capita only) and milk productivity (3.7 kg/day/milking animal) in Bihar are some of the lowest in India (DAHD, GoI, 2008). The modern milk marketing chains, especially those involving milk co-operatives, have emerged significantly in the state. But, traditional marketing continues to play an important role in the milk supply chain in the state.

Agriculture road map for dairy development give thrust on the expansion of the cooperative society network so as to make available an avenue for surplus milk disposal in a maximum number of villages, human capital development so farmers will perceive the improved animal maintenance practices, breed improvement, infrastructure development for processing and preservation of milk and market development so that all the milk collected is sold at a remunerative rate to the urban customers.

Economics of Milk Production in Bihar:

In the majority of households, milk production was only one component of the farming and employment strategy. In such cases, return to land and labor should be viewed in terms of returns per liter of milk. The revenue per liter included the price of milk received minus the cost of selling milk if any. The costs include only the variable costs like feed and input services. The costs of family labor and land were not included. Dairy farming appeared to be a profitable venture as per the recent surveys and studies. On average, milk producers selling milk through traditional milk marketing chains make a profit of Rs 2.98 per liter of milk produced. The profit from milk production turned out to be considerably higher in the case of farmers linked with the modern milk supply chain (Rs 4.71/liter). The differences between the prices paid for milk by traditional and modern milk marketing chains are very minute. And the farmers linked with the modern milk supply chain can reduce the cost of milk production (per unit) and can raise their profitability. This may be attributed to the reduction in transaction cost in the acquisition of inputs and services, adoption of better breeds, and improved management practices by linking with the modern milk supply chain. The household income generated from dairying is about Rs 43/day to Rs 94/day. This proves that the farmers can earn good profits, irrespective of their linkage with the milk marketing chains. As dairy farming is the most profitable venture and the demand for milk and milk products is growing rapidly, and there is good scope to upscale milk production activities. The up-scaling will help you to enhance the household income of the milk-producing households. Further, the constraints which have been preventing the expansion and intensification of dairying in spite of its profitability, need to be identified and ameliorated.

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Dairy Feed Management in Bihar:

The Maximum dairy farmers in Bihar are small holders with one or two local-bred milch animals, which are raised on crop residues and natural pastures with family labor. Feeding grains, oil cakes and green, nutritious fodder are limitedly available for crossbred cattle. Feed and fodder deficiencies are major problems in raising livestock productivity.

Crop residues and by-products are the major components in livestock feed. Dry fodder affords the largest proportion of fodder accounting for about 89% of the feed requirements. Straws of paddy and wheat both together contribute to about 95% of dry fodders feeds for the livestock in Bihar.

The proportion of green fodder in total livestock feed is up to 11%. About 55% of green fodders is cultivated in the farmlands. Maize, sorghum, berseem, Napier grass, and some of the legume species are mostly cultivated by the farmers. The stoves of green maize and sorghum will contribute about 30% of the total green fodder, particularly in maize growing areas, and berseem and Napier grass constitute 20% of the green fodder. Cut grasses, weeds and rogues are the best sources of green fodder— accounting for about 40% of the green fodder—and fed to the livestock after chopping. And also, the leaves of some trees and banana trunk also good supplementary green fodder.

Every household that owns livestock store fodder for future purpose. Storage practices depends on the types of feed items. Generally, paddy straw is stored in a corner of open rooms. The loose piles of paddy straw are stacked together and stored in open place.  This type of storage is common in the areas where paddy is cultivated.  The best practice you observe in households of Bihar for storage of paddy straw is in heaps/bundles arranged in a cylindrical shape covered by a conical shaped cap made of paddy straw/thatch in the fields or near the house.

Dairy Breeding Policy in Bihar: 

The dairy production in the country is witnessing a dynamic change for the last few decades. The indigenous cow population has been declining and being replaced by crossbred cows; the buffalo population has been steadily increasing. These changes in population trends are attributed to the increasing demand for milk and the diminishing importance of work animals. The productivity of crossbred cows has been almost constant or declining in the recent past, whereas the productivity of indigenous cows and buffaloes has been increasing gradually. The unsatisfactory progress in productivity is attributed to indiscriminate breeding of animals and the absence of genetic improvement programs in the field.

The story in Bihar is no different. The indigenous cow population has been declining, the crossbred population has been increasing rapidly and the buffalo population has been growing marginally. The productivity of all types of animals is constant or marginally increasing. The main reasons attributed to slow increase in productivity are also similar: indiscriminate breeding of animals and inadequate attention to making available quality bulls and semen for breeding of different types of animals.

Bihar is endowed with good resources in many parts. Feed and fodder resources are not limiting factors in most of the districts. Traditionally, farmers have been rearing animals and are aware about dairy management practices. Dairying has a huge potential in the state in terms of providing remunerative employment to farmers in most of the districts.

Considering the importance of dairying in the state and the need to attain higher genetic gain in the cattle and buffalo population, the state government requested NDDB to help them in preparing suitable breeding policies that would enable farmers to produce and own animals suited to their environmental and resource constraints.

This committee has categorized breeds to the districts based on their agro-climatic conditions:

• In West Champaran, East Champaran, and Gopalganj districts the suitable indigenous cattle breeds are Bachaur or Hariana and Buffalo breed is Mehsana and Murrah.
• In Araria, Krishnaganj, Purnia districts the indigenous cattle breeds are Red sin or Gir and Buffalo breed is Mehsana and Murrah.
• In Arwal, Jehanabad, Aurangabad, Gaya, and Nawada districts the suitable dairy cattle breed is Jersey, indigenous cattle breeds are Hariana or Tharparkar and Buffalo breed is Mehsana.
• In Sheohar and Sitamarhi districts the suitable dairy cattle breed is Jersey, indigenous cattle breeds are Hariana or Bachaur and Buffalo breed is Mehsana.
• In Madhbanithe suitable dairy cattle breed is Jersey, indigenous cattle breeds are Red Sindhi or Gir and Buffalo breed is Mehsana.
• In Supaul, Saharsa, Madhepura and Katihar the suitable dairy cattle breed is Jersey, indigenous cattle breeds are Red Sindhi or Gir and Buffalo breed is Mehsana.
• In Nalanda, Sheikhpura, Lakhisarai, Munger, Jamui, and Banka the suitable dairy cattle breed is Jersey, indigenous cattle breeds are Sahiwal and Buffalo breed is Murrah.
• In Muzaffarpur, Darbhanga, Vaishali, Khagaria, Buxar, Kaimur, and Rohtas the suitable dairy cattle breed is Jersey, indigenous cattle breeds are Sahiwal or Hariana and Buffalo breed is Murrah.
• In Siwan, Saran, Bhojpur, Patna, Samastipur, Begusarai, and Bhaalur the suitable dairy cattle breed is Jersey, indigenous cattle breeds are Sahiwal or Hariana and Buffalo breed is Murrah.

The success of any breeding policy depends on its effective implementation. Many programs fail due to faulty implementation despite the policy being formulated with great care. The suggestions below could facilitate the effective implementation of a recommended policy:

1. Farmers should be involved in the process of deciding and implementing a breeding policy.
2. Animal identification system is essential for recording individual animals’ ownership, pedigree, breed/blood level, breeding history etc.
3. The source of quality bulls and semen doses should be identified with care for use in the state. Pedigree details of bulls should be made known to farmers.
4. Semen doses of bulls of a particular breed or breed combination recommended for a particular cluster must be made available to all Al technicians at all times.
5. Al technicians should be made aware of the Breeding Policy. Their proficiency in carrying out Als should be assessed and only then should they be registered.
6. In places where Al facilities are not feasible at present, bulls for natural service should be made available. But while making bulls available for natural service, it should be ensured that the bulls of the particular breed or breed combination recommended for the particular cluster only are supplied.
7. A Field performance recording system should be initiated in some pockets to monitor, evaluate and undertake an impact assessment of the breeding policy.
8. A Regulatory Authority should be established and made responsible for:
   • Education of farmers regarding the Breeding Policy.
   • Registration of service providers and Al Technicians.
   • Enforcement of the approved breeding policy in the state.
   • Monitoring quality control of Al delivery services provided by all service providers. Authorizing the use of semen and bulls from other states on quality considerations alone.
   • Undertaking a periodic review of breeding policies and programs, suggesting and implementing appropriate measures for further improvement.

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Financial Assistance from Banks for Dairy Farming in Bihar:

All the nationalized and private banks are offering loans for Dairy farming in Bihar at a reasonable interest. For acquiring loan for dairy farm  you need to submit a detailed documentation.

Dairy Entrepreneurship Development Scheme”(DEDS) is a  scheme from NABARD for dairy development in Bihar:

The Main Objective of the Scheme:

• This scheme helps in setting up of modern dairy farms for the production of clean milk.
• It encourages heifer calf rearing.
• It strives to bring structural changes in the unorganized sector so that initial processing of milk can be taken up at the village level itself.
• It helps in upgradation of quality and traditional technology to handle milk on a commercial scale.
• It generates self-employment and provide infrastructure, mainly for unorganized.

Implementing period and Area of operation:

The scheme will be implemented all over the state, without restrictions applicable to Operation Flood areas for financing of milch animals.

Eligibility for subsidy of dairy farming in Bihar:

• All the small and marginal farmers, individual entrepreneurs, NGOs, companies, groups of unorganized and organized sectors etc. and the groups of organized sectors that includes self-help groups, dairy cooperative societies, milk unions, milk federations etc. are eligible for this scheme.
• An individual is eligible for this scheme, to avail assistance for all the components under the scheme but only once for each component
• More than one member of a family can be assisted under the scheme, if they set up separate units with separate infrastructure at different locations. But the minimum distance between the two, such farms should be at least 500m.

Subsidies for dairy farming in Bihar:

Type1: For establishment of small dairy units with crossbred cows/ indigenous descript milch cows like Sahiwal, Red Sindhi, Gir, Rathietc / graded buffaloes up to 10 to 15 animals.

• Investment: the investment will be Rs 5.00 lakh for 10 animal units – minimum unit size is 2 animals with an upper limit of 10 animals.
• Subsidy: 25% of the investment (33 .33 % for SC / ST farmers,). The Subsidy shall be restricted depending on the unit size.

Type2: Rearing of heifer calves – cross bred, indigenous descript milch breeds of cattle and of graded buffaloes – upto 20 calves.

• Investment: Rs 4.80 lakh for 20 calf unit – minimum unit size of 5 calves with an upper limit of 20 calves.
• Subsidy: 25% of the investment (33.33 % for SC / ST farmers. The Subsidy shall be restricted depending on the unit size.

Type3: Vericompost (with milch animal unit to be considered with milch animals and not separately).

• Investment: Rs. 20,000/-
• Subsidy: 25% of the investment  (33.33 % for SC / ST farmers).

Type4: Purchase of milking machines /milkotesters/bulk milk cooling units (upto 2000 lit capacity).

• Investment: Rs 18 lakh.
• Subsidy: 25% of the investment (33.33 % for SC / ST farmers).

Type5: Purchase of dairy processing equipment for manufacture of indigenous milk products.

• Investment: Rs 12 lakh.
• Subsidy: 25% of the investment (33.33 % for SC / ST farmers).

Type6: Establishment of dairy product transportation facilities and cold chain.

• Investment: Rs 24 lakh.
• Subsidy: 25% of the investment (33.33 % for SC / ST farmers).

Type7: Cold storage facilities for milk and milk products.

• Investment: Rs 30 lakh.
• Subsidy: 25% of the investment (33.33 % for SC / ST farmers).

Type8: Dairy marketing outlet / Dairy parlour.

• Investment: Rs 56,000/-
• Subsidy: 25% of the investment (33.33 % for SC / ST farmers).

Eligible financial institutions for Dairy Farming in Bihar:

• Commercial Banks
• Regional Rural Banks
• State Cooperative Banks
• State Cooperative Agriculture and Rural Development Banks are eligible for NABARD Scheme.

Dairy Loans Sanction by banks

The entrepreneurs can apply to their nearer banks for approval of the project. The bank will survey the project as per their norms and if you are eligible, they will sanction the total outlay excluding the margin, as the bank loan. The loan amount will be released in instalments depending on the progress of the unit. After the issue of the first instalment of the loan, the bank shall apply to the concerned Regional Office of NABARD for sanction and release of subsidy.

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Repayment of Dairy Loan

Repayment Period depends upon the work and cash flow and the period will vary between 3- 7 years. You may get the grace period 3 months to 3 years for calf rearing units. A grace period will be decided by the financing bank as per needs of individual projects.

The loan recovery is based on the net loan amount only. i.e. not including subsidy, which will be adjusted by the bank after effective bank loan and interest repayment. The repayment schedules are mainly based on the total amount of the loan (including subsidy).

Rate of Interest on Dairy Loan

The rate of interest on the loans should be as per the RBI guidelines and declared policy of the bank in this regard. The bank may charge interest on the complete  loan amount till the subsidy is received and from the date of receipt of subsidy by the implementing branch, interest has to be charged only on the effective bank loan portion (excluding the margin and subsidy.

Government Schemes for  Dairy Farming in Bihar:

Doodh Ganga Yogana:

This scheme gives finance for:

• Establishing small dairy units upto 10 animals.
• Finances for rearing heifer calves.
• Vermi-compost (with milch animal units).
• Purchasing the milking machines, cooling units and other dairy equipment’s.
• Dairy Processing equipment’s.
• Transportation facilities and cold chain, cold storage for milk and milk products.
• Establishment of veterinary clinics.
• Dairy parlors.

The scheme approves loans up to rupees15 lakh for setting up of machines and coolers for the purpose of milk production and conservation.

For the transportation of dairy product, a loan of 25 lakh can be availed under the scheme.

Loan from rupees 1.2 lakh to 4.8 lakh are given for purchasing cattle and to set up another animal husbandry venture.

NABARD through the Doodh Ganga Yojana is trying to people in the rural areas for dairy development and to improve their economic status. The main objective of the 300-crore scheme is to give finance 10,000 Self Help Groups by extending the loan of rupees 3 lakh for each unit. Assistance provided for the scheme is credit linked and subject to sanction of the project by the banks.

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