The Indian Dairy Industry has acquired substantial growth from the Eighth Plan onwards, achieving an annual output of over 90.7 million tonnes of milk at the end of 2004-05. India’s milk output has not only placed the dairy industry first in the world, but also represents sustained growth in the availability of milk and milk products. The per capita availability of milk was estimated to be 231 gm per day during 2004-05. The Government implemented four schemes in the dairy sector during 2005-06.

• Intensive Dairy Development Programme: The scheme, since modified as Intensive Dairy Development Programmeon the basis of the recommendation of the evaluation studies, launched during the Eighth Plan period is being continued during the Tenth Plan with an outlay of Rs 175 crore. So far, 73 projects with an outlay of Rs 407.58 crore have been sanctioned in 25 States and one UT. A sum of Rs 274.30 crore has been released to various State Governments up to 31 March 2006 and 185 districts have been covered. The scheme has benefited about 9.60 lakh farm families and organised about 15,500 village Level Dairy Cooperative Societies till 31 March 2006.
  
  
• Strengthening Infrastructure for Quality and Clean Milk Production: A new centrally sponsored scheme was launched in October 2003, with the main objective of improving the quality of raw milk produced at the village level in the country. Under this scheme, assistance is provided for training of farmers on good milking practices. The scheme is being implemented on 100 per cent grants-in-aid basis to the State Governments/UTs for components viz. training of farmer members, detergents, stainless steel utensils, strengthening of existing laboratory facilities whereas 75 per cent financial assistance is provided for setting up of milk chilling facilities at village level in the form of bulk milk coolers. The scheme has a budget outlay of Rs 30 crore for the Tenth Plan and during 2005-06 an amount of Rs 30.39 crore has been released to various States. Since inception, 98 projects in 21 States at a total cost of Rs 125.18 crore with a Central share of Rs 102.92 crore have been approved upto 31 March 2006 under this scheme.
  
  
• Assistance to Cooperatives: The Scheme, Assistance to Cooperatives is Central Sector Plan Scheme started during the year 1999-2000.
  
  A number of dairy cooperative with three-tier structure viz. village level primary cooperatives, district level unions and state level federations have been set up in different parts of the country under Operation Flood Programme. For a variety of reasons, a number of these unions/federations have accumulated losses. These accumulated losses have been imposing severe hardship to the milk producers and their dairy economy, resulting in, among other things, delayed and irregular payment to the poor farmer members of these cooperatives. The scheme seeks to assist the sick Cooperative Milk Unions/Federations to rehabilitate them and make them viable.
  
  The funds are released on 50:50 sharing basis between Union of India and the concerned State Governments. The maximum assistance of grant is limited to the minimum amount required so that net flow becomes positive within seven years. In any case, the total grant does not exceed the accumulated cash losses.
  The scheme is implemented through National Dairy Development Board (NDDB) and Project Report for rehabilitation plan is prepared by them following the guidelines of the Scheme in consultation with concerned Milk Union/State Cooperative Dairy federation and the State Government. Each rehabilitation Plan is implemented within a period of 7 years from the date of approval.
  
  Till 2005-06, the Department had approved 31 rehabilitation proposals of milk unions in Madhya Pradesh, Chhattisgarh, Karnataka, Uttar Pradesh, Haryana, Kerala, Maharashtra, Assam, Nagaland, Punjab, West Bengal and Tamil Nadu with a total outlay of Rs 165.34 crore. An amount of Rs 69.64 crore has been released till 31 March 2006.
  
  
• Dairy/Poultry Venture Capital Fund : To bring about structural changes in the unorganised sector, measures like milk processing at village level, marketing of pasteurised milk in a cost-effective manner, quality upgradation and upgradation of traditional technology to handle commercial scale using modern equipment and management skills and to encourage new species of birds and low input technology for poultry farming among rural farmers, a new Central sector scheme viz; Dairy/Poultry Venture Capital Fund has been initiated with an outlay of Rs 25 crore during the 10th Five Year Plan. Under this scheme assistance is provided to the rural/urban beneficiaries under a schematic proposal through bankable projects. The eligible beneficiaries, under the scheme include agriculture farmers/individual entrepreneurs and groups of all sections of unorganised as well as organised sector including cooperatives and NGOs from any part of the country.

The scheme is being implemented through NABARD and funds amounting to Rs 15.80 crore have been released to NABARD during 2005-06, to be kept as revolving fund for implementation of the scheme. There is a budget provision of Rs 15 crore for implementation of the scheme during 2006-07.

Patern of assistance :

• Entrepreneurs’ contribution 10 per cent
• Interest-free loan from revolving fund 50 per cent
• Bank loan at interest applicable for agricultural activities 40 per cent

The interest component applicable for agricultural activities is subsidised by Government of India to the extent of 50 per cent in case of regular/timely repayment by the beneficiary.

Milk and Milk Product Order-1992: The Government notified the Milk and Milk Product Order in June 1992. As per the provisions of this order, any person/dairy plant handling more than 10,000 liters per day of milk or 500 MT of milk solids per annum needs to be registered with the registering authority appointed by the Central Government.

The Order was amended from time to time as per the decision taken in Milk and Milk Product Advisory Board and as per request received from State Governments. As per the amendment dated 26 March 2002, the provisions of assigning milk shed have been done away with. The power of granting Registration to the units up to two lakh litres per day processing capacity where entire activities of units lies within a State has been delegated to concerned State Registering Authority.

So far, Central Registering Authority and State Registering Authorities have granted registration to 789 units with a combined capacity of 980.50 lakh litres per day of milk up to 31 March 2006.