PLP 2018-19 – II

Kaimur

Area Development Scheme on Dairy

1. Introduction
Animal Husbandry-Dairy is an important source of subsidiary income to
small/marginal farmers, agricultural labourers and women. This sector has the
potential of providing the much needed hedging risk against the crop loss due to
natural calamities. Since agriculture is mostly seasonal and dependent on
monsoon, there is a possibility of finding regular dependable employment
throughout the year, especially for rural population, by undertaking dairy
activity. Dairy as a part of allied activity of agriculture, can also be taken up
successfully as full time occupation by unemployed educated as well as
uneducated population in the district where the demand for milk and milk based
products is high vis-a-vis short supply. Further, the by-products from the dairy
farm could be gainfully utilized for various purposes. The dung from the animals
could be a source of organic manure, vermin compost for improving soil fertility
and yielding better quality crops. Its urine is also useful.

Objective
The basic objective is to facilitate immediate execution of locally important
livelihood activities which may spread over the major segment of vulnerable
section of the society to uplift their economic as well as the social status. The
purpose of the Scheme is to focus the financing for the proposed activity in the
scheduled area of the district on a cluster basis with a view to increase the capital
formation in agriculture/allied sector and accelerate the ground level credit
under the priority sector.

The Area Development Scheme envisages a common understanding amongst

NABARD and financing banks operating in the district. This would provide a
platform for all concerned viz., Farmers, Bankers and Line Departments to work
in a coordinated manner and would also fulfill the objective of scientific lending
and creation of quality live stocks through infrastructural and other promotional
support from Line Departments, credit support by banks and with technical and
refinance assistance from NABARD.

Role of Dairy Sector in the District

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Dairy has enormous potential in the district at low risk as compared to crop loss
due to natural calamities every year. The district has a substantial concentration
of livestock activities. The sector is playing very positive role in providing rural
self-employment at a very low cost of investment. Dairy is a potential activity in
the district because of readily availability of a huge market. Apart from Shahabad
Dairy’s unit of COMFED, which operates in the district, some private dairies are
also operating in the district.

Scenario of Dairy Sector in Kaimur District

Kaimur District has 11 Blocks. The population of the district as per 2011 Census
is 16.26 lakh, out of which rural population is 15.61 lakh, i.e, 96%. The economy
of the district is dominated by agriculture as more than 80% of the population
depends directly or indirectly on agriculture for their livelihood. The economy of
the district is characterized by agricultural activities and the main food crops
grown in the district are paddy, wheat, maize, pulses and oilseeds. Apart from
agriculture other allied activities in the district are dairy, goatery, poultry, fishery
etc.

Availability and Gaps in Infrastructure and support services

 There are 2 cattle market in the District. Most of the Cattle/ Buffalo are sold
by traders from outside states.
 A total of 15 AI centres are also being run in the district
 In the district 23 veterinary dispensaries/institutions are present in the
district.
 The demand of feed is met through local produced material and through a
number of feed brands/companies which are supplying feed in the local
market.
 Dairy Activities are supported under various government programmes like
Samagra Gavya Vikas Yojna, GoB. Central Government Support is also
available under Dairy Entrepreneurship Development Scheme being
implemented through NABARD.
 Dairy Development activities in the district are looked after by Dairy
Development Department and Animal Husbandry Department. There is
acute shortage of veterinary doctors and extension officials.

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 A milk chilling plant with a capacity of approx 1500 litres per day is in
operation at Shahabad Dairy in Mohania.
 There are 1200 dairy registered milk societies with Shahabad Dairy where
some units are reported to be non-functional.
 There are some milk collection centres and there is a huge requirement of
such milk collection centres in the district.

Reason for selecting Dairy Development as ADS

There is a scope for increasing or scaling up the milk production in the district
through cross breeding programme and also creating awareness among the
farmers about the scientific housing, breeding, feeding and health care of animal
which will improve the milk production and productivity in the district. Based on
the production gap in milk production, banking network, backward & forward
linkages potential available in different districts of the state, Kaimur has been
identified as potential district for Dairy Development for implementation of Area
Development Scheme.

Land Holdings
Total Land Holdings No. of Total Land Holdings
Total of the District 191724
Marginal Farmers 77652 (41%)
Small Farmers
Other Farmers 114072 (59%)
 Net Sown Area – 176734 Ha.
 Net Irrigated Area – 71794 Ha.
 Major Crops – Paddy, wheat, maize, pulses, oilseeds

Livestock population, Production and Productivity(AH Census 2012)

(No. in lakh)
Crossbreed Cow Indigenous Cow Bufallows Total Dairy Animal
(0.141) (1.43) (1.03) (2.601)
Male Female Milch Male Fem Milch Male Female Milch Male Female Milch
(60% of ale (60% of (60% of (60% of
Female) Female) Female) Female)
0.031 0.11 0.066 0.61 0.82 0.492 0.08 0.95 0.57 0.721 1.88 1.128
Productivityper 5.0 Liter 2.5 Liter 4.4 Liter
Day
Production per 0.33 1.23 Lakh 2.51 Lakh 4.07
Day Lakh Litre Litre Lakh
Litre Litre

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2. Forward and backward linkages

Milk Production
Out of the total population of 2.60 lakh of cattle and buffalo in the district, the
population of milch animal is about 1.128 lakh. The total milk production of the
district is around 4.07 Lakh Litre per day which is less than the national average
of 337 gm per day.

Infrastructure for veterinary services

There are 23 Veterinary Hospitals and 15 Artificial Insemination Centre
established in the district. Animal Husbandry department is providing free of
cost vaccination of cattle and buffaloes against foot & mouth and H.S. Diseases.
The gap in requirement of Veterinary Hospitals and AI centers could be partly
bridged through RIDF assistance for new centers and also by encouraging
private veterinary clinics and private AI centers under the scheme for Agriclinics
and Agribusiness centers through institutional finance involving unemployed
veterinary graduates.

Feed and fodder

Cultivation of fodder as a commercial activity is not in practice in the district.
Concentrate cattle feed is available through private agents in the districts and
farmers also prepare concentrate mixture by purchasing the ingredients locally.
Cultivation and preservation of fodder can be promoted among the farmers in
district.

Marketing infrastructure-Milk societies, Milk routes, Milk

procurement, Supply
The presence of milk societies is not strong in the district. Besides 2 Livestock
market, some milk collection centres are available in the district. The Shahabad
Dairy (SUDHA) has several milk routes and collecting milk through societies.
Besides, private sector dairies collect milk through Dudhias (private vendors).

Sources for animals

Availability of good quality animals is one of the major constraints affecting
credit support for dairy development in the district. The milch animals therefore
can be purchased from other parts of the State and also from other States. From
the discussions with the local AH department, it has been observed that among

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CB cows, Jersey and HF crossbred cows are more common in the district and HF
crossbred has well acclimatized to the local conditions. Among buffaloes,
Murrah/Graded Murrah are the most preferred by farmers. In the proposed ADS
buffalo farming has not been adopted due to short lactation period however
bankers may finance buffalo units as per the preference of borrowers.

Marketing of Milk
As such the present system of marketing of milk is very much unorganized,
majority of milk produced in the district is handled privately by the
farmers/through agents. It is reported that that some of private dairies are
supplying milk from outside the district. The milk union may identify potential
areas along milk routes and may try to cover the farmers to be covered under the
Area Development Scheme. Thus the capacity utilization of the Milk union may
also be increased.

Cost of Animals
The cost of Cross Breed Cow HF, Jersey, etc. yielding 08 to 10-13 lpd has been
considered at 50,000/- after ascertaining the cost from various stakeholders.
The cost may go even higher in certain seasons.

Sale price of Milk

The sale price of milk has been assumed at Rs. 27.95/ltr (on conservative side)
for cow milk having 4.5% fat and 8.4% Solid Not Fat after ascertaining the same
from the Shahabad Dairy. The financial viability has been worked out
considering these rates. The major risk variables for this project will be milk
yield and sale price of milk. Hence the farmers should enter into agreement with
the cooperative/private milk processing agencies for marketing of milk
produced.

3. Selection of Area
Two blocks (Chainpur and Chand) of the district is proposed for the
implementation of the Scheme.

4. Selection of the beneficiaries

(i) The women farmers of SHGs promoted by JEEVIKA or members of JLG
promoted by NABARD may be given priority by the bankers for financing of 2 CB
units. Implementing bank have the sole discretion for selection of borrowers as
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per their norms, however to facilitate the process of financing the units Dairy
Development Department may provide the list of the perspective borrowers to
concerned Branch Managers implementing ADS.

(ii) Unit Size

Unit size of 2, 5, 10 may be adopted in the project, however bankers are free to
finance units of other sizes also as per the technical feasibility and financial
viability of the project.

5. Training / Capacity building of the beneficiaries

The AH department and Dairy department in district are offering training to the
farmers on various aspects of AH and Dairy farming. Otherwise
 By granting EDPs to RSETI by NABARD/DRDA/NRLM
 By sanctioning MEDPs/ LEDPs to Anchor Agency of the district
 Sponsoring programmes to KVK by NABARD

6. Techno economic assumptions

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Annexure-IA : Assumptions (Two Cows)
Sl.No. P articulars UoM Quantity

1 No. of 2 cow units Unit 1

2 Proje ct Pe riod Ye ars 5

3 Batch size of Dairy Cow with fe male calve s No. 1

4 No. of Batch Size to be purchase d in First Ye ar Batch 2

5 Batch Inte rval Months 3

6 Total Dairy Cows No. 2

Cost of Dairy Cow with Fe male calf including
7 Rs./Cow 55000
Transportation

8 Lactation pe riod pe r Lactation Days 300

9 Dry Pe riod Days 90

10 Inte rcalving Pe riod Days 390

11 Fe male Calving ratio % 50%

Avrage Productivity pe r Cow pe r Day during
12 Litre 10
Lactation
13 Ave rage Fat conte nt of Milk % 4.2

14 Ave rage SNF conte nt of Milk % 8.4

15 Se lling price of Milk Fat Rs.pe r Kg 245

16 Se lling price of Milk SNF Rs.pe r Kg 184

17 Productivity of Gre e n fodde r pe r acre Kg 40000

18 Cost of Gre e n fodde r cultivation pe r acre Rs 15000

19 Unit cost of Gre e n fodde r pe r Kg Rs/Kg 0.38

20 Cost of Dry Fodde r Rs/Kg 4.00

21 Cost of Conce ntrate pe r Kg Rs/Kg 16.00

22 Ave rage Daily Gre e n Fodde r Intake pe r Cow Kg/Day 20

23 Ave rgae Daily Dry Fodde r Intake pe r Cow Kg/Day 4

Ave rgae Daily Conce ntrate Intake pe r Cow during
24 Kg/Day 5
Lactation
Ave rgae Daily Conce ntrate Intake pe r Cow during
25 Kg/Day 3
Dry Pe riod

26 Ave rage Daily Gre e n Fodde r Intake pe r calf/he ife r Kg/Day 10

27 Ave rgae Daily Dry Fodde r Intake pe r calf/he ife r Kg/Day 1

28 Ave rgae Daily Conce ntrate Intake pe r Calf/he ife r Kg/Day 1

29 Cove re d Are a Re quire me nt pe r Cow Sq. ft 40

30 Ope n Are a Re quire me nt pe r Cow Sq. ft 80

31 Cove re d Are a Re quire me nt pe r He ife r Sq. ft 30

32 Ope n Are a Re quire me nt pe r He ife r Sq. ft 60

33 Space re quire me nt for Calf Pe n pe r Calf Sq. ft 20

34 Cost of Construction of Cove re d Are a Rs/Sqft 250

35 Cost of Construction of Ope n Are a Rs/Sqft 50

36 Cost of Construction of Calf Pe n Rs/Sqft 150

37 Conce ption Rate of AI % 50%

38 Cost of AI Rs/AI 150

39 Ave rage Annual Ve te rinary e xpe nse s pe r Cow Rs/Cow 2000

40 No. of Labour re quire d Labour/Unit 0

41 Othe r Manage me nt Cost Rs/Unit 0

42 Cost of Insurance Pre mium pe r Cow pe r Ye ar @4% Rs./Cow 4400

43 Rate of Bank Loan Inte re st % 11.50%

44 Se lling Price of He ife rs Rs/He ife r 15000

45 Se lling price of Fe male Calve s Rs/He ife r 5000

46 Cost of Chaff Cutte r Rs/Unit 0

47 Cost of Milking Pails Rs/Unit 0

48 Cost of Milk Cans Rs/Unit 0

49 De pre ciation rate of Buildings % 10%

50 De pre ciation rate of Equipme nts and Machine ry % 20%

51 Sulvage value of Dairy Cow Rs/Cow 22000

52 Insurance Pre mium % 4

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Annexure-III(A) : Assumptions (Five Cow Units)

Sl.No. Particulars UoM Quantity
1 No. of 5 cow units Unit 1
2 Project Period Years 5
3 Batch size of Dairy Cow with female calves No. 2.5
4 No. of Batch Size to be purchased in First Year Batch 2
5 Batch Interval Months 6
6 Total Dairy Cows No. 5
7 Cost of Dairy Cow with Female calf including transpotation cost Rs.2500/- Rs/Cow 55000
8 Lactation period per Lactation Days 300
9 Dry Period Days 90
10 Intercalving Period Days 390
11 Female Calving ratio % 50%
12 Avrage Productivity per Cow per Day during Lactation Litre 13
13 Average Fat content of Milk % 4.2
14 Average SNF content of Milk % 8.4
15 Selling price of Milk Fat Rs.per Kg 245
16 Selling price of Milk SNF Rs.per Kg 184
17 Productivity of Green fodder per acre Kg 40000
18 Cost of Green fodder cultivation per acre Rs 15000
19 Unit cost of Green fodder per Kg Rs/Kg 0.38
20 Cost of Dry Fodder Rs/Kg 4.00
21 Cost of Concentrate per Kg Rs/Kg 16.00
22 Average Daily Green Fodder Intake per Cow Kg/Day 10
23 Avergae Daily Dry Fodder Intake per Cow Kg/Day 4
24 Avergae Daily Concentrate Intake per Cow during Lactation Kg/Day 5
25 Avergae Daily Concentrate Intake per Cow during Dry Period Kg/Day 3
26 Average Daily Green Fodder Intake per calf/heifer Kg/Day 10
27 Avergae Daily Dry Fodder Intake per calf/heifer Kg/Day 1
28 Avergae Daily Concentrate Intake per Calf/heifer Kg/Day 2
29 Covered Area Requirement per Cow Sq. ft 30
30 Open Area Requirement per Cow Sq. ft 75
31 Covered Area Requirement per Heifer Sq. ft 30
32 Open Area Requirement per Heifer Sq. ft 60
33 Space requirement for Calf Pen per Calf Sq. ft 20
34 Cost of Construction of Covered Area Rs/Sqft 250
35 Cost of Construction of Open Area Rs/Sqft 50
36 Cost of Construction of Calf Pen Rs/Sqft 150
37 Conception Rate of AI % 60%
38 Cost of AI Rs/AI 100
39 Average Annual Veterinary expenses per Cow Rs/ Cow 2000
40 No. of Labour required Labour/Unit 1
41 Other Management Cost Rs/Unit 0
42 Cost of Insurance Premium per Cow per Year @ 4% Rs./Cow 2200
43 Rate of Bank Loan Interest % 11.50%
44 Selling Price of Heifers Rs/Heifer 15000
45 Selling price of Female Calves Rs/Heifer 5000
46 Cost of Chaff Cutter and other equipments Rs/Unit 9000
47 Cost of Milking Pails Rs/Unit 500
48 Cost of Milk Cans Rs/Unit 1500
49 Depreciation rate of Buildings % 10%
50 Depreciation rate of Equipments and Machinery % 20%
51 Sulvage value of Dairy Cow Rs/Cow 22000
52 Insurance Premium % 4

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Annexure-IIIA : Assumptions (Ten Cow Units)

Sl.No. Particulars UoM Quantity
1 No. of 10 cow units Unit 1
2 Project Period Years 5
3 Batch size of Dairy Cow with female calves No. 5
4 No. of Batch Size to be purchased in First Year Batch 2
5 Batch Interval Months 6
6 Total Dairy Cows No. 10
7 Cost of Dairy Cow with Female calf including transpotation cost Rs/Cow 55000
8 Lactation period per Lactation Days 300
9 Dry Period Days 90
10 Intercalving Period Days 390
11 Female Calving ratio % 50%
12 Avrage Productivity per Cow per Day during Lactation Litre 13
13 Average Fat content of Milk % 4.2
14 Average SNF content of Milk % 8.4
15 Selling price of Milk Fat Rs.per Kg 245
16 Selling price of Milk SNF Rs.per Kg 184
17 Productivity of Green fodder per acre Kg 40000
18 Cost of Green fodder cultivation per acre Rs 15000
19 Unit cost of Green fodder per Kg Rs/Kg 0.38
20 Cost of Dry Fodder Rs/Kg 4.00
21 Cost of Concentrate per Kg Rs/Kg 16.00
22 Average Daily Green Fodder Intake per Cow Kg/Day 10
23 Avergae Daily Dry Fodder Intake per Cow Kg/Day 4
24 Avergae Daily Concentrate Intake per Cow during Lactation Kg/Day 5
25 Avergae Daily Concentrate Intake per Cow during Dry Period Kg/Day 3
26 Average Daily Green Fodder Intake per calf/heifer Kg/Day 10
27 Avergae Daily Dry Fodder Intake per calf/heifer Kg/Day 1
28 Avergae Daily Concentrate Intake per Calf/heifer Kg/Day 2
29 Covered Area Requirement per Cow Sq. ft 40
30 Open Area Requirement per Cow Sq. ft 75
31 Covered Area Requirement per Heifer Sq. ft 30
32 Open Area Requirement per Heifer Sq. ft 60
33 Space requirement for Calf Pen per Calf Sq. ft 20
34 Cost of Construction of Covered Area Rs/Sqft 300
35 Cost of Construction of Open Area Rs/Sqft 50
36 Cost of Construction of Calf Pen Rs/Sqft 150
37 Conception Rate of AI % 60%
38 Cost of AI Rs/AI 100
39 Average Annual Veterinary expenses per Cow Rs/ Cow 2000
40 No. of Labour required Labour/Unit 1
41 Other Management Cost Rs/Unit 0
42 Cost of Insurance Premium per Cow per Year @ 6% Rs./Cow 2200
43 Rate of Bank Loan Interest % 11.50%
44 Selling Price of Heifers Rs/Heifer 15000
45 Selling price of Female Calves Rs/Heifer 5000
46 Cost of Chaff Cutter and other equipments Rs/Unit 35000
47 Cost of Milking Pails Rs/Unit 500
48 Cost of Milk Cans Rs/Unit 2500
49 Depreciation rate of Buildings % 10%
50 Depreciation rate of Equipments and Machinery % 20%
51 Sulvage value of Dairy Cow Rs/Cow 22000
52 Insurance Premium % 4

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7. Project cost
Investment of Capital (Two Cows)

A. Capital Investment: Unit Unit Rate Quantity Amt. (In Rs.)

A.1 Civil Construction 41,500
a. Consruction of covered area for Cow Sqft Rs. 250.00 80 20,000
b. Consruction of covered area for Heifers Sqft Rs. 250.00 30 7,500
c. Construction of Calf Pen Sqft Rs. 150.00 20 3,000
d. Consruction of open area for Cow Sqft Rs. 50.00 160 8,000
e. Consruction of open area for Heifers Sqft Rs. 50.00 60 3,000
A.2 Cost of Dairy Cows Each Rs. 55,000.00 2 110,000
A.3 Machinery and Equipments Lump Sum Rs. 0.00 0 2,690
A.4 Milking Machine Each Rs. 850,000.00 0 -
A.5 Deep borimg for water Lump Sum Rs. 50,000.00 0 -
A. Total Capital Investment 154,190
B. Working Capital Requirement for 1 Month
a) Cost of Green Fodder Kg Rs. 0.38 1200 450.00
b) Cost of Dry Fodder/Concentrate feed Kg Rs. 4.00 240 960.00
c) Insurance Premium Cow 4% 2 4400.00
B. Total 5810.00
C. Total Project Cost 160000.00
D. Margin Money (15%) 24000.00
E. Bank Loan including subsidy, if available 136000.00

Investment of Capital (Five Cows)

A. Capital Investment: Unit Unit Rate Quantity Amt. (in Rs.)
A.1. Civil Construction 90000.00
a) Consruction of Covered Area for Cow Sqft Rs. 250.00 150 37500.00
b) Consruction of Covered Area for Heifers Sqft Rs. 250.00 75 18750.00
c) Construction of Calf Pen Sqft Rs. 150.00 50 7500.00
d) Consruction of Open Area for Cow Sqft Rs. 50.00 375 18750.00
e) Consruction of Open Area for Heifers Sqft Rs. 50.00 150 7500.00
A.2 Cost of Dairy Cows Each Rs. 55,000.00 5 275000.00
A.3 Machinery and Equipments Lump Sum Rs. 11,000.00 1 11000.00
A.4 Milking Machine Each Rs. 85,000.00 0 0.00
A.5 Deep boring for water Lump Sum Rs. 20,000.00 1 20000.00
A. Total Capital Investment 396000.00
B. W orking Capital Requirement for 1 Month
a) Cost of Green Fodder Kg Rs. 0.38 1500 600.00
b) Cost of Dry Fodder Kg Rs. 4.00 600 2400.00
c) Insurance Premium Cow 4% 5 11000.00
B. Total 14000.00
C. Total Project Cost 410000.00
D. Margin Money 61500.00
E. Bank Loan including Subsidy, if available 348500.00

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Investment of Capital (Ten Cows)

A. Capital Investment: Unit Unit Rate Quantity Amt.(in Rs.)

A.1. Civil Construction 232500.00

a) Consruction of Covered Area for Cow Sqft Rs. 300.00 400 120000.00

b) Consruction of Covered Area for Heifers Sqft Rs. 300.00 150 45000.00

c) Construction of Calf Pan Sqft Rs. 150.00 100 15000.00

d) Consruction of Open Area for Cow Sqft Rs. 50.00 750 37500.00

e) Consruction of Open Area for Heifers Sqft Rs. 50.00 300 15000.00

A.2 Cost of Dairy Cows Each Rs. 55,000.00 10 550000.00

A.3 Machinery and Equipments Lump Sum Rs. 38,000.00 1 38000.00

A.4 Milking Machine Each Rs. 100,000.00 1 100000.00

A.5 Deep boring for water Lump Sum Rs. 77,000.00 1 77000.00

A. Total Capital Investment 997500.00

B. W orking Capital Requirement for 1 Month

a) Cost of Green Fodder Kg Rs. 0.38 3000 1125.00

b) Cost of Dry Fodder Kg Rs. 4.00 1200 4800.00

c) Insurance Premium Cow 4% 10 22000.00

B. Total 27925.00

C. Total Project Cost 1025425.00

D. Margin Money (15%) 153813.75

E. Bank Loan including subsidy, if any 871611.25

The unit cost has been arrived at by considering factors needed for scientific
dairy activity such as cost of animals, transportation cost of animals, insurance
cost, cost of construction of shed, open area and pen for cows and heifers and
working capital requirement for 1 month for green fodder and dry fodder.
Further, for 10 cows unit, cost of milching machine, cost for deep boring for
water availability and cost for sundry equipments and machineries have also
been taken into account.

8. Banking network & Trends in credit flow

The Lead Bank of the district is Punjab national Bank. As on 31 March 2017,
there are 110 branches of Commercial Banks, 38 branches of Madhya Bihar
Gramin Bank, 7 branches of Central Cooperative Bank, 2 branches of Land
Development Bank and 3 branches of Pvt. banks, in the district.

9. Financing Agencies
Names of the Implementing Bank – Commercial Banks, Madhya Bihar Gramin
Bank and Pvt. banks, in all 11 blocks of the district.

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10. Physical and financial programme

Dairy units of 2, 5 and 10 crossbreed cows with financial assistance from banks
operating in the two identified blocks (Chainpur and Chand) of the district will
be developed during proposed period i.e; 2018-19 to 2023-24. The summary of
the potential of project finances are enlisted in the table below:
(Rs. in lakh)
Unit No. of Financial Bank
Size of Dairy unit
cost units outlay Loan*
2 CB Cows (Average milk yield 10 LPD
1.60 400 640.00 540.00
per cow)
Dairy units (5 animals CB cows,
4.10 100 410.00 350.00
Average milk yield 10 LPD)
Dairy units (10 animals CB cows,
10.25 30 307.50 262.50
Average milk yield 10 LPD)
Grand Total 530 1357.50 1152.50
*Excluding Margin Money 15%

If, capital subsidy is available during the implementation period (2018-19 to

2023-24) of Area Development Scheme from State Govt./Central Govt., it will
encourage the farmers as well as bankers to undertake/finance this activity.
Year-wise projections under Area Development Scheme for all the blocks of the
district are as under:

Projections for the period 2018-19 to 2022-23

(Rs. lakh)
Name of the 2 cows units 5 cows units 10 cows units
blocks Physical Bank Loan Physical Bank Loan Physical Bank Loan
Unit (Rs.1.35 lakh Unit (Rs.3.5 lakh per Unit (Rs.8.75 lakh per
per unit) unit) unit)
2018-19 80 108.00 20 70.00 6 52.50
2019-20 80 108.00 20 70.00 6 52.50
2020-21 80 108.00 20 70.00 6 52.50
2021-22 80 108.00 20 70.00 6 52.50
2022-23 80 108.00 20 70.00 6 52.50
TOTAL 400 540.00 100 350.00 30 262.50
TOTAL Bank Loan 1152.50
*Bank Loan Excluding Margin Money 15%

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11. Project Profitability

Projected Income Expenditure Statement (Two Cow Units)

(Rs. in lakh)

Sl.No. Particulars UoM Unit Rate Year 1 Year 2 Year 3 Year 4 Year 5 Total
A INCOME 100620.00 150930.00 206085.00 251085.00 295085.00 1003805.00
1 Sale of Milk Litre 27.95 100620.00 150930.00 176085.00 176085.00 176085.00 779805.00
2 Sale of Heifers No. 15000.00 0.00 0.00 30000.00 75000.00 75000.00 180000.00
3 Sulvage Value of Cow No. 22000.00 44000.00 44000.00
B EXPENDITURE 91325.03 116716.36 126839.25 130602.22 125225.13 590707.99
1 Variable Cost 60180.00 89290.00 103587.50 112073.75 112073.75 477205.00
a) Cost of Green Fodder Kg 0.38 2700 5400 8137.5 12243.75 12243.75 40725.00
b) Cost of Dry Fodder Kg 4.00 5760 5760.0 14440 18820 18820 63600.00
d) Cost of Concentrate Kg 16.00 31720 57680 60560 60560 60560 271080.00
e) Veterinary Expenses Cow 2000 20000 20000 20000 20000 20000 100000.00
f) AI Expenses No. 150 0 450 450 450 450 450
2 Fixed Costs 31145.03 27426.36 23251.75 18528.47 13151.38 113502.99
a) Depreciation of Buildings % 10% 4150.00 3735 3361.5 3025.35 2722.82 16994.67
Depreciation of Machinery
b) % 20% 538.00 430.40 344.32 275.46 220.36 1808.54
& Equipments
c) Insurance Premium % 5% 5500 5500 5500 5500 5500 5500
Labour Cahrge @Rs.6000/-
d) No. 0 0 0 0 0 0 0.00
p.m.
e) Other Management Cost Month 0 0 0 0 0 0 0.00
Electricity and other
f) LumpSum 100 1200 1200 1200 1200 1200 6000.00
Miscellaneous
g) Bank Interest % 11.50% 19757.03 16560.96 12845.93 8527.66 3508.20 61199.79
C GROSS MARGIN (A-B1) 40,440 61,640 102,498 139,011 183,011 526,600
D NET PROFIT (A-B) -156000 9,295 34,214 79,246 120,483 169,860 413,097
E GROSS MARGIN% 40.2% 40.8% 49.7% 55.4% 62.0% 52.5%
F NET PROFIT % 9.2% 22.7% 38.5% 48.0% 57.6% 41.2%

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Kaimur

Projected Income Expenditure Statement (Five Cow Units)

(Rs. in lakh)
Sl.No. Particulars UoM Unit Rate Year 1 Year 2 Year 3 Year 4 Year 5 Total

A INCOME 490522.50 572276.25 647276.25 701778.75 839030.00 3250883.75

1 Sale of Milk Litre 27.95 490522.50 572276.25 572276.25 626778.75 654030.00 2915883.75

2 Sale of Heifers No. 15000.00 0.00 0.00 75000.00 75000.00 75000.00 225000.00

3 Sulvage Value of Cow No. 22000.00 110000.00 110000.00

B EXPENDITURE 348897.39 442637.47 474259.45 466471.28 454717.93 2186983.52

1 Variable Cost 194070.00 298140.00 341083.75 345883.75 348283.75 1527461.25

a) Cost of Green Fodder Kg 0.38 6750 13500 20343.75 20343.75 20343.75 81281.25

b) Cost of Dry Fodder Kg 4.00 28800 28800 64900 64900 64900 252300.00

d) Cost of Concentrate Kg 16.00 132520 229040 229040 233840 236240 1060680.00

e) Veterinary Expenses Cow 2000 26000 26000 26000 26000 26000 130000.00

f) AI Expenses No. 100 0 800 800 800 800 800

2 Fixed Costs 154827.39 144497.47 133175.70 120587.53 106434.18 659522.27

a) Depreciation of Buildings % 10% 9000.00 8100 7290 6561 5904.90 36855.90

Depreciation of Machinery &

b) % 20% 6200.00 4960.00 3968.00 3174.40 2539.52 20841.92
Equipments

c) Insurance Premium % 4% 11000 11000 11000 11000 11000 11000

d) Labour Cahrge @Rs.6000/- p.m. No. 1 72000 72000 72000 72000 72000 360000.00

e) Other Management Cost Month 0 0 0 0 0 0 0.00

f) Electricity and other Misc. LumpSum 500 6000 6000 6000 6000 6000 30000.00

g) Bank Interest % 11.50% 50627.39 42437.47 32917.70 21852.13 8989.76 156824.45

C GROSS MARGIN (A-B1) 296452.50 274136.25 306192.50 355895.00 490746.25 1723422.50

D NET PROFIT (A-B) -396000.00 141625.11 129638.78 173016.80 235307.47 384312.07 1063900.23

E GROSS MARGIN% 60.4% 47.9% 47.3% 50.7% 58.5% 53.0%

F NET PROFIT % 28.9% 22.7% 26.7% 33.5% 45.8% 32.7%

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Kaimur

Projected Income Expenditure Statement (Ten Cow Units)

(Rs. in lakh)
Sl.No. Particulars UoM Unit Rate Year 1 Year 2 Year 3 Year 4 Year 5 Total

A INCOME 654030.00 1131045.00 1219552.50 1219552.50 1439552.50 5663732.50

1 Sale of Milk Litre 27.95 654030.00 981045.00 1144552.50 1144552.50 1144552.50 5068732.50

2 Sale of Heifers No. 15000.00 0.00 150000.00 75000.00 75000.00 75000.00 375000.00

3 Sulvage Value of Cow No. 22000.00 220000.00 220000.00

B EXPENDITURE 501340.94 624790.17 621064.62 586001.98 547734.60 2880932.31

1 Variable Cost 208470.00 363327.50 392383.75 392383.75 392383.75 1748948.75

a) Cost of Green Fodder Kg 0.38 6750 27187.5 20343.75 20343.75 20343.75 94968.75

b) Cost of Dry Fodder Kg 4.00 28800 43400 64900 64900 64900 266900.00

d) Cost of Concentrate Kg 16.00 146920 265040 279440 279440 279440 1250280.00

e) Veterinary Expenses Cow 2000 26000 26000 26000 26000 26000 130000.00

f) AI Expenses No. 100 0 1700 1700 1700 1700 1700

2 Fixed Costs 292870.94 261462.67 228680.87 193618.23 155350.85 1131983.56

a) Depreciation of Buildings % 10% 23250.00 20925 18832.5 16949.25 15254.33 95211.08

Depreciation of Machinery &

b) % 20% 43000.00 34400.00 27520.00 22016.00 17612.80 144548.80
Equipments

c) Insurance Premium % 4% 22000 22000 22000 22000 22000 22000

Labour Cahrge @Rs.6000/-

d) No. 1 72000 72000 72000 72000 72000 360000.00
p.m.
e) Other Management Cost Month 0 0 0 0 0 0 0.00

f) Electricity and other Misc. LumpSum 500 6000 6000 6000 6000 6000 30000.00

g) Bank Interest % 11.50% 126620.94 106137.67 82328.37 54652.98 22483.73 392223.69

C GROSS MARGIN (A-B1) 445560.00 767717.50 827168.75 827168.75 1047168.75 3914783.75

D NET PROFIT (A-B) -997500.00 152689.06 506254.83 598487.88 633550.52 891817.90 2782800.19

E GROSS MARGIN% 68.1% 67.9% 67.8% 67.8% 72.7% 69.1%

F NET PROFIT % 23.3% 44.8% 49.1% 51.9% 62.0% 49.1%

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12. Financial Analysis

Cost-Benefit Analysis of Two Cows Unit

(Rs. in lakh)
Sl.No. Particulars Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Total

A Capital Investment -160000.00 0 0 0 0 0 -160000

B PBITD (B1-B2) 40440 61640 72498 64011 64011 302600

B1 Cash Income 100620 150930 176085 176085 176085 779805

B2 Cash Expenditure 60180 89290 103588 112074 112074 477205

C Net Cash Flow -160000.00 40440 61640 72498 64011 64011 142600

D Interest Paid 19757 16561 12846 8528 3508 61200

E Principle Repayment 19683 22879 26594 30912 35932 136000

F Bank Repayment 39440 39440 39440 39440 39440 197200

F Net Present Value @12% Rs. 48,081

G IRR 24%

H DSCR 0.72

I BCR 1.30

Cost-Benefit Analysis of Five Cows Unit

(Rs. in lakh)
Sl.No Particulars Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Total

A Capital Investment -396000 0 0 0 0 0 -396000

B PBITD (B1-B2) 207453 185136 217193 266895 401746 1278423

B1 Cash Income 490523 572276 647276 701779 839030 3250884

B2 Cash Expenditure 283070 387140 430084 434884 437284 1972461

C Net Cash Flow -396000 207453 185136 217193 266895 401746 882423

D Interest Paid 50627 42437 32918 21852 8990 156824

E Principle Repayment 50438 58627 68147 79213 92075 348500

F Bank Repayment 101065 101065 101065 101065 101065 505324

F Net Present Value @12% 436595

G IRR 49%

H DSCR 1.75

I BCR 2.10

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Cost-Benefit Analysis of Ten Cows Unit

(Rs. in lakh)
Sl.No. Particulars Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Total

A Capital Investment -997500 0 0 0 0 0 -997500

B PBITD (B1-B2) 345560 667718 727169 727169 947169 3414784

B1 Cash Income 654030 1131045 1219553 1219553 1439553 5663733

B2 Cash Expenditure 308470 463328 492384 492384 492384 2248949

C Net Cash Flow -997500 345560 667718 727169 727169 947169 2417284

D Interest Paid 126621 106138 82328 54653 22484 392224

E Principle Repayment 126146 146629 170439 198114 230283 871611

F Bank Repayment 252767 252767 252767 252767 252767 1263835

p Net Present Value @12% 1214731

G IRR 51%

H DSCR 1.91

I BCR 2.22

13. SWOT analysis:

a. Strengths:
i. Good supplementary activity in the scheme area for doubling the farmers
income
ii. Adequate availability of forward and backward linkages in the scheme
area
b. Weaknesses:
i. Limited green fodder availability in the scheme area
ii. Inadequate awareness among the farmers on scientific dairy farming

c. Opportunities:
i. Growing demand for milk from consumers in the area due to increasing in
income level
ii. Proximity to demand centres / markets

d. Threats:

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Kaimur

i. Changes in Govt. policy leading to adverse procurement price

ii. Weak monsoons adversely affect the milk production and thereby milk
procurement.

14. Repayment Period (Rs. in lakh)

Income Expenses Gross Surplus EMI Instal Net Surplus

Yr
2 5 10 2 5 10 2 5 10 2 5 10 2 5 10

1 1.06 4.91 6.54 0.26 2.84 3.08 0.80 2.07 3.46 0.39 1.01 2.53 0.41 1.06 1.93

2 1.51 5.72 11.31 0.50 3.87 4.63 1.01 1.85 6.68 0.39 1.01 2.53 0.62 0.46 4.15

3 1.76 6.47 12.20 0.64 4.30 4.93 1.12 2.17 7.27 0.39 1.01 2.53 0.73 1.16 4.74

4 1.76 7.02 12.20 0.73 4.35 4.93 1.03 2.67 7.27 0.39 1.01 2.53 0.64 1.66 4.74

5 1.76 8.39 14.40 0.73 4.37 4.93 1.03 4.02 9.47 0.39 1.01 2.53 0.64 3.01 5.94

15. Implementation and Monitoring

i. Initial approval at the DCC level
ii. Block-wise allocation at BLBC meetings
iii. Review of the implementation in DCC and BLBC meetings
iv. Involvement of stakeholders’ agencies in review meetings for ensuring the
extension of support services committed by them.
v. The progress should be monitoring regularly in DCC/DLRC as a
compulsory Agenda
vi. A Sub-Committee of DCC/DLRC headed by LDM, DDM, DDDO, DAHO,
Local Heads of all the participating Banks, Expert from KVK and
concerned Branch Managers, may be formed and would be meeting
quarterly to review and monitor the progress.
Suggested Action Points.
 Banks
i. Financing of units of 2, 5 and 10 animals Cross Bred Cattle (Holstein Friesian
and Jersey Crosses).
ii. Bankers may proactively finance the agriculture and veterinary graduates
trained under Agri clinics and Agri business Centers scheme for setting up of
veterinary dispensaries and provision of services including frozen semen
banks, liquid nitrogen supply and extension consultancy under ACABC or
DEDS Scheme.
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iii. Financing by banks for plantation of fodder trees along the boundaries/bunds
and uplands with dryland horticulture techniques
iv. Financing of two wheelers and three wheelers by banks for selling of milk to
the households and local market
v. Financing for BMCUs, Deep fridge and Milk vans by banks
 Development Departments of Govt.
i. Distribution of seeds and saplings/slips for Green Fodder production under
irrigated and unirrigated fields, demonstration of Vermi - composting units,
urea treatment of straw and Silage Making by individual farmers.
ii. The existing infrastructure in the animal husbandry sector should be made
functional by allocation of adequate budget, manpower and materials.
iii. Breeding farms to be established in Government and private sector to
augment supply of cross breed animals.
iv. Adequate technical staff to be posted at government and bank level to guide
the farmers regarding the economic benefits of the various animal husbandry
schemes and also provide technical guidance during their implementation.
v. Establishment of a processing plants for value addition to various animal
husbandry products such as milk.

Other related matters

In view of poor veterinary and extension services available in the district, there is
good scope of financing for Agri clinics centres for Agricultural graduates &
Veterinarians (ACABC) Scheme or DEDS scheme of GoI. Such centres would
provide clinical services for animal health/AI services for breed improvement
and supply of feed and veterinary inputs etc., which would enhance productivity
of animals. Under the scheme different types of projects may be considered like
–
 Private Veterinary Clinic
 Private Veterinary Clinic with retail outlet for Feed and Medicine.
 Private Veterinary Clinic with small Dairy unit.
 Private Artificial Insemination Centre.

16. Conclusion

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i. The Area Development Scheme on Dairy Development Sector, will discuss

and facilitate the implementation of perspective plan of the State Govt.,
infrastructure gaps, available incentives/schemes from both Central and
State Govt., fiscal incentives (taxes, subsidies etc.) available/being
proposed for development of the Sector, support mechanism
available/needed for procurement and marketing from State and Central
Govt., and identify scope for convergence of efforts and areas for financing
in the entire value chain of the sector and this is how ADS is going to
benefit the farmers in doubling their income, increase in milk availability,
increase in capital formation, etc.
ii. Increase in Annual Production of the District – Financing of 530 units
during the ADS period will contribute the increase of about 17350 liters of
milk per day with an increase of Rs. 11.53 crore in Ground Credit Flow,
only in 02 blocks of the district.

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