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Dairy Farming Subsidy In India – By Government

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Dairy Farming Subsidy In India through NABARD by Indian Government: Well, dairy farming is one of the best livestock businesses in India. It is one of the major sources of income, especially in rural areas. However, setting up a dairy farm is not that easy. The dairy farming business requires investment, hard work, and dedication. For profitable commercial dairy farming, one must have knowledge of dairy management. As the population is increasing every year, the demand for milk is multiplying. Apart from this milk-based products have tremendous demand throughout the world. You can start a dairy farming business with few animals and expand as you go. However, the government of India encouraging dairy business by providing subsidies and loans through NABARD (National bank for agriculture and rural development).

A guide to Dairy Farming Subsidy In India through NABARD by Indian Government

Dairy Cow Subsidy
Dairy Cow (Image source: pixabay)

The Indian government launched the NABARD subsidy for dairy farming in the years of 2010. You can find many components with subsidies available under this NABARD dairy farming scheme. As an individual, you can avail all the subsides but only once for each component. In case of more than one person in the family is applying for a NABARD dairy farming subsidy, they must establish separate units and required infrastructure in different sites. In such a scenario, it is required to maintain at least 1/2 km between the dairy units.

What skills are required for the dairy farming business

  • You must be aware of different breeds of cattle/cows/buffalos suitable for your region.
  • You must know how to select dairy breeds. This can be done with a help of veterinary doctor.
  • You must know dairy business management from rearing to milking.
  • You should be aware of dairy feed management practices.
  • You should be aware of breeding procedure in dairy farming business.
  • You should have an idea of different diseases in dairy farming.
  • You should be aware of new born kids management in dairy business.
  • You should know about handling of labour at your dairy farm.
  • You can take dairy farming training course from animal husbandry of agriculture department.
  • You can visit nearby dairy farms to find out issues faced by dairy farmers.
  • Get an idea of dairy farm management by watching dairy farming videos in You Tube channel.

Benefits of the dairy farming business

In case if you miss this: Sheep Farming In India.

Dairy Farming in India
Dairy Farming in India (Image source: pixabay)
  • As you know dairy milk has excellent demand, so you will have less difficulty in selling any kind of dairy products. You can market the milk at your farm gate itself.
  • Under ideal dairy management practices, you can earn decent profits.
  • Commercial dairy farming will provide the employment for rural as well as urban population
  • Farmers can easily get NABARD dairy farming subsidy and loan.
  • It is a pollution free business.
  • The dairy animal urine and dung can be used  in organic farming because it works as excellent organic fertilizer for organic agriculture crops.
  • It is easy to mange intensive dairy farm compared to open grazing method of farming.

Who can go NABARD dairy farming subsidy?

  • Individuals.
  • Farmers.
  • NGO’s
  • Entrepreneurs.
  • Dairy cooperative societies, Self help groups.
  • Organizations/companies/firms.

What are the main objectives of the NABARD dairy farming subsidy

  1. Dairy farming in India is an unorganized sector hence they want bring structural changes which provides the window for  initial processing of milk at rural levels.
  2. To provide modern dairy farming methods for high yield of milk production and quality milk.
  3. To help in producing good breeding stock by heifer calf rearing.
  4. To provide employment through dairy farming sector in all levels such as villages, urban areas.
  5. To meet the demand of milk consumption.
  6. To encourage milk based business processing units.
  7. To strengthen the dairy sector of agriculture throughout India.

NABARD dairy farming subsidy schemes under RBI guidelines.

Type of schemeInvestment requiredSubsidy %
10 animal unit -establishment of small dairy units with crossbred cows / milch cows. (Breed types such as Gir cows, Sahiwal cows, Red Sindhi cows, Rathi/Rath cows, etc..)Rs. 5,00,000 for 10 dairy animals. Limits: Minimum unit size = 2 calves Maximum unit size = 20 calvesFor the unit size of 10 animals:   25% for general category farmers (Subsidy amount of Rs.1,25,000).   33 .33% for SC / ST farmers (Subsidy amount of Rs. 1,67,000).   For the unit size of 2 animals:   The maximum permissible capital subsidy is  Rs.25,000 for general category farmers.   The maximum permissible capital Rs. 33,300 for SC/ST farmers.   Note: Subsidy of the project shall be restricted on a prorated basis depending on the unit size or number of animals.
Heifer calves rearing ( crossbred, indigenous descript milch breeds of cattle and of graded buffaloes –  up to 20 calves unit).Rs. 4,80,000 for 20 animal unit Limits: Minimum unit size = 5 calves Maximum unit size = 20 calvesFor unit size of 10 calves:   25% for general category farmers (Subsidy amount of 1,20,000)33 .33% for SC / ST farmers (Subsidy amount of Rs. 1,60,000).   For the unit size of 5 calves:   The maximum permissible capital subsidy is Rs 30,000 for general category farmers.   The maximum permissible capital subsidy is Rs. 40,000 for SC/ST farmers. Note: Subsidy of the calves project shall be restricted on a prorated basis, depending on the unit size or number of calves.
Vermicompost (with milch animal unit ). Rs. 20,00025% for general category farmers (Subsidy amount of Rs. 5,000).   33 .33% for SC / ST farmers (Subsidy amount of Rs. 6,700).  
Purchase of milking machines. It also includes milk testers, bulk milk cooling units ( max of 2000 liter capacity).Rs.18,00,00025% for general category farmers (Subsidy amount of Rs. 3,00,000).   33 .33% for SC / ST farmers (Subsidy amount of Rs. 4,00,000).  
Purchase of dairy processing equipmentRs. 12,00,00025% for general category farmers (Subsidy amount of Rs. 4,50,000).   33 .33% for SC / ST farmers (Subsidy amount of 6,00,000).  
Dairy product transportation and cold chain establishments.Rs. 24,00,00025% for general category farmers (Subsidy amount of Rs. 6,00,000).   33 .33% for SC / ST farmers (Subsidy amount of Rs. 8,00,000).  
Cold storage facilitiesRs. 30,00,00025% for general category farmers (Subsidy amount of Rs. 7,50,000).   33 .33% for SC / ST farmers (Subsidy amount of Rs. 10,00,000).  
Private veterinary clinics establishmentsRs. 1,80,000 for  stationary clinics. Rs. 2,40,000 for mobile clinics.25% for general category farmers (Subsidy amount of  Rs .45,000 and Rs. 60,000 for stationary  and mobile clinics).   33 .33% for SC / ST farmers (Subsidy amount of  Rs.60,000 and  Rs. 80,000 for stationary  and mobile clinics ).  
Dairy marketing outletsRs. 56, 00025% for general category farmers (Subsidy amount of Rs.14,000).     33 .33% for SC / ST farmers (Subsidy amount of  Rs.18,600 ).  

Processes of Getting NABARD dairy farming subsidy

You may also check this: Pig Farming Subsidy In India.

Newly Born Calf
Dairy Farm (pic credit: pixabay)
  • It is better to register a dairy company or any other suitable business name when you are planning for large scale dairy farming business.
  • First and foremost, you should decide the dairy farming component intended to apply for subsidy under NABRAD dairy scheme. The business model should be one of the above mentioned component.
  • You should prepare a detailed project report  or a dairy farming business plan will the technical feasibilities of dairy farm unit with bank loan component.
  • Go to any agriculture rural bank (bank should eligible for refinance from NABARD) for submitting a request with detailed project work to get a loan for your farm.
  • Technical officer will visit the site for verification and the bank loan shall be sanctioned
  • The sanction of the loan amount, interest rate, repayment period, and collateral requirement depends on individual bank terms bank policies.
  • Once the first instalment of the loan is fulfilled, the bank shall apply NABARD dairy farming subsidy.
  • Once the NABARD dairy farming subsidy is released to the bank, the bank will keep the subsidy amount in a subsidy reserve fund account with no interest.
  • However, after successful repayment of loan, the last couple of instalments will be adjusted with subsidy amount.
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Last Updated:
Author: Jagdish

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