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Pashu Sandesh, 02 Feb 2021
Covid-19 lockdown caused a drop in the market demand due to the closure of the outlets selling livestock products. With the closure of sweet shops and tea stalls, a large number of private dairies were impacted and they stopped milk procurement from the farmers. This resulted in the farmers' di-verting their milk to the cooperatives. As a result, milk procurement in the cooperative sector increased because, as per their mandate, they could not reject milk supplied by the farmers. The cooperatives are faced with liquidity problems due to higher conversion into milk powder and white butter caused by higher milk procurement.
Steps were taken to keep close surveillance on the milk situation and facilitate the resolution of the issues relating to the forward and backward linkages for smooth supply of milk and milk products during the lockdown. As one-time support, a sub-scheme for providing interest subvention on working capital loans was designed for the financial year 2020-21 under the ongoing scheme State Dairy Cooperative & Farmers Producers Organization (SDCFPO) to provide interest subvention of 2 per cent per annum, with an additional incentive of 2 per cent interest subvention for prompt and timely repayment to the financially stressed milk unions. Consequent upon budget announcement on the inclusion of livestock sector in Kisan Credit Card in February 2020, 1.5 crores dairy farmers of milk cooperatives and milk producer companies’ were targeted to provide Kisan Credit Cards (KCC) as part of Prime Minister’s Atma Nirbhar Bharat Package.