Dairy stocks in demand after Cabinet proposals

Shares of seven dairy companies rose 1.02% to 10.32% after the Union Cabinet on Wednesday approved a Rs 4,558 crore scheme to promote the dairy sector which will benefit about 95 lakh farmers in about 50,000 villages.

Umang Dairies (up 10.32%), Vadilal Industries (up 4.89%), Milkfood (up 1.81%) and Prabhat Dairy (up 1.02%), were top gainers in dairy segment.

Addressing the media on key Cabinet decisions, Information and Broadcasting Minister Prakash Javadekar, on Wednesday, said this scheme will take the "White revolution" to the next level.

The Cabinet has also decided to increase interest subvention from 2% to 2.5% under the scheme Dairy Processing and Infrastructure Development Fund (DIDF) with the revised outlay of Rs 11,184 crore.

The activities that come under DIDF include modernisations of new milk processing facilities and manufacturing facilities for value added products; chilling infrastructure; electronic adulteration testing kit; project management and learning.

Under DIDF, 28,000 bulk milk coolers will be established with 140 lakh litres per day as additional milk chilling capacity. Milk drying capacity will also be increased to 210 metric tonne per day. Also, 28,000 milk testing equipment will be provided to check adulteration in milk.

The Union Cabinet also approved proposal to create infrastructure of 59.78 lakh litres per day capacity for value-added dairy products to ensure remunerative prices to milk producers.

The central government will provide interest subvention up to 2.5% to NABARD from 2019-20 (with effect from 30 July 2019) to 2030-31 and in case there is any further increase in the cost of funds, it will be borne by the end borrowers themselves, as per the Cabinet statement.

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