Lockdown is in its third phase but in the last fortnight, more relaxations have enabled traction in economic activities in the country. A stimulus package of 20 lakh crores was announced by our prime minister and later budget announcements related to the dairy sector were made. It would take some time for all of us to understand on how these budget numbers would be practically reaching in the hands of the stakeholders.
The coverage of the dairy sector under Atma Nirbhar Bharat is as follows:1. Additional steps during COVID for the dairy sector
- The demand of milk dropped by 20-25%
- 560 lakhs lpd milk procured by cooperatives against daily sale of 360 lakh lpd
- Total 111 crores L extra milk procured ensuring payment of Rs 4100 Crores to farmers.
- 2% interest subvention scheme for cooperatives on prompt payment/ interest servicing
- The scheme will unlock 5000 Cr additional liquidity, benefitting 2 crore farmers.
2. Rs 1 lakh crore agri-infrastructure fund for farm gate infrastructure for farmers that includes cold chain infrastructure
3. Animal Husbandry Infrastructure Development Fund- Rs 15000 Crore
- Many areas in the country with high milk production having great potential for private investment in Dairy
- Aim to support private investment in Dairy Processing, value addition and cattle feed infrastructure
- An animal Husbandry Infrastructure Development Fund of Rs 15000 Crore will be set up
- Incentives to be given for establishing plants for the export of niche products
4. National Animal Disease Control Program
- National disease control Program for FMD and Brucellosis launched with a total outlay of Rs 13343 crores
I think that Agriculture infrastructure fund is the consolidation of all types of the project under Pradhan Mantri Agri sector infrastructure schemes including Sampada. The national animal disease control program is also an ongoing program that was launched last year.
So in this edition, I shall be just looking at Rs 15000 Crores Animal husbandry Infrastructure Development Fund and Rs 4100 crores as stated to be spent on purchasing extra milk from the public cooperative sector during lockdown period.
One needs to set the context before planning a solution like a stimulus package or setting up a fund for a serious problem like COVID. As rightly said by one of a corporate leader that either you treat a chronic part or an acute part of a problem. All the announcements made yesterday seem to have been addressing the chronic part of this ailment in the long term and that too depends upon how these plans are implemented. But how the acute part of this problem (ie the losses which our 55 million dairy farmers have incurred during recent lockdown) will be addressed by the government., is yet to be seen.
Let us first examine the figure of Rs 4100 Crores which is stated to be spent on buying extra milk during COVID. This was paid to around 17 million farmers under government cooperatives. All the unions which processed this milk to commodities were also offered a 2 % interest subvention against the working capital or stocks. This is commendable and appreciated.
India is a country of around 70 + million dairy farmers so we are still left with around 15 million farmers under private cooperatives and another 40 million representing the unorganized milk trader, aggregator, vendor, etc. They have incurred heavy losses under the lockdown period as the unorganized sector is majorly serving the HORECA and tea shops around the country.
If I take the figure of Rs 4100 Crores as a reference support package by the government for 17 million farmers then we need another Rs 13250 Crore for the balance 55 million dairy farmers on a pro-rata basis. Those farmers are also part of the dairy ecosystem of India.
If Public cooperatives have got an interest subvention against the stocks or on their working capital, then the private sector has also bought milk from the farmers during the lockdown and converted that into dairy commodities. They have also saved a large number of farmers in the country. Today the private sector is also bearing the cost of huge stocks of SMP and butter which has been converted during the lockdown to safeguard the dairy farmers.
If the government does not act fast by stimulating demand of milk powder in PDS or mid-day meals then the huge stocks of SMP and butter will kill all hopes of farmers to get a better price till next summer.
During this time of the COVID crisis, the government is appealing to everyone for showing solidarity, dignity, and empathy towards the weaker sections. This is a period of inclusion. One can not discriminate between the public sector and their farmers and private sector and their farmers during this period. All schemes must be designed for both sectors simultaneously.
I am not trying to gain sympathy for the private sector while seeking instant support for dairy farmers and private processors rather I am asking the government to show empathy towards all the stakeholders and walk the talk.
I am very happy to see a little tilt in the level playing field when I saw Rs 15000 Crores animal husbandry infrastructure development fund. I only need to understand if this Rs 15000 Crore Animal husbandry Infrastructure Development fund , different from Rs 10881 Crores DIDF (Dairy processing infrastructure development Fund )which is under implementation for a period from 2018-19 to 2022-23? Seeking clarifications.
At the end, I request the policymaker to consider the following requests for instant relief to the Nongovernment dairy cooperative sector.
a. Rs 13000 Crores instant relief in the hands of 55 million dairy farmers who are not pouring milk in government dairy cooperatives.
b. 2% interest subvention for the private sector dairies against the stocks built by them during the lockdown period so that they could also buy more milk with the saved money later.
c. Making SMP as part of PDS ( as we have been requesting for the last few months) otherwise India may have the highest pile of stocks and farmers will not be able to get a good price till next summers.
d. The government may start paying fixed warehousing charges for these stocks to all the registered dairy plants. EU has given Rs 255 crores for a stock of 330000 MT of powder, cheese, and butter. This could be done at least six months. The government may also ask the warehouses and cold storage being set up under Sampada and other schemes to hold these stocks. The government may pay directly to these warehouses also, This way all those having a spare capacity in their warehouses will also survive in these times of crisis.
I think our government must ensure that all the names being given to various schemes must be made a reality also.
A name has no meaning if the actions are done in opposite direction or if no action is taken up in time.
I pray God to bless everyone with health, peace, and adequate sources of income in this period of the Corona crisis. Let everyone on this earth be safe with his near and dear ones.
