Government Approves Extension of AHIDF

The Union Cabinet approved the continuation of the Animal Husbandry Infrastructure Development Fund (AHIDF) to be implemented with an outlay of Rs.29,610.25 crore for another three years up to 2025-26. The scheme will incentivize investments in dairy processing and product diversification, meat processing and product diversification, animal feed plants, breed multiplication farms, animal waste-to-wealth management, and veterinary vaccine and drug production facilities. The government will provide a 3% interest subvention for 8 years including two years of moratorium for loans up to 90% from the scheduled bank and National Cooperative Development Corporation (NCDC), NABARD, and NDDB. The eligible entities are individuals, private companies, FPO, MSME, and Section 8 companies. Now the dairy cooperatives will also avail benefits for modernization, and strengthening of the dairy plants. The government of India will also provide credit guarantees to the MSME and Dairy Cooperatives up to 25% of the credit borrowed from the Credit Guarantee Fund of Rs.750 crore. The AHIDF has so far created an impact by adding 141.04 LLPD (Lakh Ltr. Per Day) of milk processing capacity, 79.24 lakh metric tons of feed processing capacity, and 9.06 Lakh metric tons of meat processing capacity by adding to the supply chain since the inception of the scheme. The scheme has been able to increase processing capacity by 2-4% in the dairy, meat, and animal feed sector.

After the inclusion of new activities like technologically assisted breed multiplication farms, strengthening of veterinary drugs and vaccine units, and animal waste to wealth management, the scheme will exhibit a huge potential for the upgradation of infrastructure in the livestock sector. The scheme will be a channel towards employment generation directly and indirectly to 35 lakh people through entrepreneurship development and aims for wealth creation in the livestock sector. So far, the AHIDF has benefitted directly /indirectly approximately 15 lakh farmers.  AHIDF is emerging on a path towards achieving the Prime Minister’s goal of doubling farmers’ income, tapping the livestock sector by bringing the private sector investment, bringing in the latest technologies for processing and value addition, and last but not least contributing to the Nation’s economy by promoting the export of livestock products. Such investments in processing and value-addition infrastructure by eligible beneficiaries would also promote the export of these processed and value-added commodities.

Amul Dairy has launched a new feed variety that will improve solid-non-fat (SNF) in the milk of cows and buffaloes. The problem of low fat and SNF in milk is common in the country’s domestic dairy industry. The milk union’s study revealed that low SNF content was due to less protein and energy in the diet provided to the dairy animals. We had initiated a project through which 3,000 machines were installed in all the villages in our milk shed area. There are three main reasons behind low SNF content including mixing water with milk, subclinical mastitis (which lowers milk production), or lack of vitamin and mineral-rich feed.

The Central Government has granted certain exemptions under the Income Tax Act to dairy cooperative societies to boost the sector. Primary cooperative societies involved in the supply of milk to the federal cooperative society can now claim deductions for their entire profit related to milk supply to union societies under section 80P of the Income Tax Act, 1961. The surcharge on cooperative societies has been reduced from 12% to 7% for incomes exceeding ₹1 crore and up to ₹10 crores. The rate of alternate minimum tax for cooperative societies has been lowered from 18.5% to 15%, aligning it with the rate applicable to companies. Amendment to Section 269T now ensures that no penal consequences arise for cash repayments by Primary Agricultural Credit Societies ( PACS ) or Agricultural and Rural Development Banks ( PCARDB ) if the amount is less than ₹2 lakh, up from the previous ₹20,000 limit. Co-operative societies now enjoy a higher threshold of ₹3 crore for TDS on cash withdrawal, compared to the ₹1 crore limit applicable to other recipients under section 194N. The government is offering interest subvention on short-term crop loans up to ₹3 lakh for farmers, at an attractive rate of 7% per annum. Prompt repayments attract an additional 3% interest subvention, bringing the effective rate of interest down to 4%. Since 2018-19, the government has introduced the Kisan Credit Card ( KCC ) scheme for Animal Husbandry and Fisheries, providing short-term working capital loans of up to ₹2 lakh per beneficiary, aligning them with short-term crop loans. These measures aim to provide a substantial boost to the dairy sector and promote the financial well-being of cooperative societies involved in dairy activities.