Govt mulls ban on fodder export

The department of animal husbandry under the ministry of food and agriculture plans a slew of measures — both in the long and short terms — to bring down the cost of milk, milk products and poultry.

The short-term measure it proposes includes ban on export of fodder for cattle, primarily oil meals and oil cakes. Officials said a large portion of the increase in input costs of dairy products and poultry is due to rising prices of raw and processed edible oil. In the process, it added to the cost of oilmeals and oilcakes, increasingly used as fodder. Due high input cost, milk prices were going up, they explained.

“The requirement is expected to increase and import of skimmed milk is a strong option. With a supply deficit in the local market, import duty should be brought down to zero, along with a complete ban on export of the milk products and fodder,” said an official close. These trade measures are at an advanced stage of deliberation before being forwarded to the finance ministry.

Among the long-term measures, Rs 1.29 crore has been sanctioned to National Bank for Agriculture and Rural Development (Nabard) for the implementation of a dairy entrepreneurship development scheme. “In fact, the ministry has completely revamped the features of dairy/poultry venture capital fund scheme , including the funding pattern. The scheme to be extended to agriculture farmers, individual entrepreneurs and groups of all organised and unorganised sector will now be called ‘Dairy entrepreneurship Development Scheme,” official sources said.(Click for table)

The funding pattern to the entrepreneur has been changed as well by including an element of direct subsidy. Thus, the beneficiary will be given a direct subsidy, called back-ended capital subsidy of 25 per cent of the total project cost, which is pegged at 33 per cent for scheduled caste/scheduled tribes. The back-ended subsidy is a fund released after adjusting against the last few instalments of repayment of bank loan. The remaining project cost will be met by entrepreneurs’ own contribution to a minimum of 10 per cent and a bank loan for a minimum of 40 per cent of rest of the funds. This subsidy will have a minimum lock-in period of three years and would be refunded by the government to the bank if the account becomes non-performing.

Earlier, the funding under DPV was in the form of an interest-free loan up to 50 per cent of the total project cost, a normal bank loan up to 40 per cent and a minimum entrepreneur contribution of 10 per cent. Under the changed plan, half of interest-free loan is a direct subsidy.

The objective includes setting up modern dairy farms, heifer calf rearing for conservation and development of good breeding stock, organising the diary sector and generation of self employment.