Milk Production Management & Dairy Development

Module 14. Dairy development in India Phases and schemes

Lesson 21
FIVE YEAR PLANS AND DAIRY DEVELOPMENT

21.1 Introduction

After independence our country adopted the policy of mixed economy wherein both private and public sector was to play their respective roles in development of the country. For rapid economic development accompanied by continuous progress towards equality and social justice, India adopted the policy of five year plans.

21.2. Five Year Plans

The table 21.1 reveals that allocation for dairying (D) and animal husbandry (AH) progressively increased the each five year plan. It was Rs. 158 millions in first five year plan (1951-56) and increased Rs. 8510 million in sixth five year plan (1980-85). As compared to agriculture, the allocation is lower. The allocation for the Dairying and Animal Husbandry is on an average 0.8 percent of the total outlay. On analysis of these costs, it has been found that expenditure on dairying has been mainly on collection, transport, processing and distribution of milk. The production aspect of milk and particularly production of quality / hygienic milk has been not given due importance during various plan periods.

Table 21.1 Dairy development under various five year plans

Expenditure Head	Ist plan (1951-56)	2nd plan (1956-61)	3rd plan (1961-66)	Annual plans (1966-69)	4th plan (1969-74)	5th plan (1974-78)	Annual plans (1978-80)	6th plan (1980-85)	Total	%
Dairying and Animal Husbandry	158	330	800	597	2331	4377	2670	8510	19773	1.0
Agriculture and Allied Programme	1900	2434	6458	9436	27282	46435	35604	56951	86500	9.6
Total	2058	2764	7258	10033	29613	50812	38274	65461	106273	10.6
Others	17542	43956	78512	57527	129409	342408	204238	909539	1783131	89.4
Total public sector	19600	46720	85779	67560	159022	393220	242512	975000	1989404	100

21.2.1 First five year plan

In the First five year plan (1951-56) the dairy development programme started in a small way. The main activities of the dairy development programme were to supply the good quality milk under hygienic conditions to big cities. This was supported by the scheme of procurement of milk from rural areas. In this plan period dairy development activities were started in Andhra Pradesh, Bihar, Madhya Pradesh Orissa, Tamil Nadu and Uttar Pradesh. 146 key village blocks having the facility of artificial insemination was established. 650 veterinary hospitals and 25 gosadans were also established. The milk supply scheme was started in two metro cities i.e. Bombay and Calcutta. In this plan period, total production of milk in the country was 18 million tonnes. During this plan period, in 1955, the Indian Dairy Research Institute was transformed into the National Dairy Research Institute (NDRI). Its headquarter was shifted to Karnal from Bangalore.

21.2.2 Second five year plan

In the second five year plan (1956-61) certain specific objectives relating to production, marketing and consumption was laid down. In this plan period major thrust was given on quality control and paying remunerative price to both milk producer as well as consumer. It favored the establishment of milk producer co-operative societies at village level to ensure supply of milk to city dairies, creameries and milk drying plants. In this plan period, it was envisaged to establish dairy factory at Anand, the Delhi milk supply scheme, 36 milk plants, expansion of existing 114 key village blocks and 670 Artificial Insemination center, 34 new gosadans, 248 goshalas, 1900 veterinary hospitals. The plan promoted the three private entrepreneurs: Glaxo, Levers and Nestle to establish milk product plants. In the first five year plan NDRI, Southern region station at Bangalore was established. In this plan expansion of the same was carried out. During the second plan period, seven liquid milk plants were completed and eight pilot schemes, three milk creameries and two milk product factories were taken up. In addition, civil works on 31 milk supply schemes were on the verge of completion.

By 1959, there were 2257 co-operative milk supply societies and 77 milk supply unions. About 2, 11, 131 farmers / milk producer were affiliated to this milk supply societies. This 77 milk supply unions owned in aggregate funds to the tune of Rs. 1.83 crores and marketed milk and milk products of Rs. 11.32 crores.

21.2.3 Third year plan

The major objective of third five year plan (1961-66) was to develop dairy projects emphasizing milk production in rural areas linked with plants for marketing surplus milk to urban centers. This plan emphasized the need to collect milk by a network of village milk producer's co-operative societies and to organize manufacture and marketing of milk and milk products on co-operative lines. The efforts and money invested on dairying in earlier two plan periods have yielded appropriate results but still the major problem confronting the dairy industry was the absence of public participation.

Hence, the plan felt the need of cooperatives and the establishment of separate dairy development departments in each state.

In this plan period aim was kept to establish 55 milk supply schemes, and rural creameries, 6 milk products factories, 2 cheese factories, 4 cattle feed compounding factories. Apart from this, it was also aimed to complete the leftover schemes of the second plan period. Madras milk supply scheme was also started during this period only. One of the most important highlight of this plan period was the establishment of National Dairy Development Board, at Anand in 1965.

21.2.4 Fourth five year plan

In the Fourth Five Year Plan (1969-74) target was kept to set up 49 milk supply schemes, 11 milk product factories and 43 rural dairy centers. Of these 6 milk supply schemes, 2 milk product factories and 32 rural dairy centers were commissioned. The cross breeding in cattle with exotic dairy breeds was taken up on a large scale during the plan by establishing frozen semen stations. The project operation flood was conceived and formulated by National Dairy Development Board in this plan Period.

21.2.5 Fifth five year plan

By 1974, 100 Dairy Plants and 62 pilot dairy schemes were set up. Of these 100 dairy plants, 94 were managed by government either through state dairy development corporations or by government department. By 1975, expansion work to increase the capacities of dairy plants in the four metros was completed and two large new plants were commissioned in Bombay and Delhi. A new large plant for Madras was also established and construction of a similar plant for Calcutta was in progress. Apart from these, establishment of 13 new plants and expansion of the capacity of 7 existing rural dairy plants acting as feeder balancing units was also planned. Probably for the first time more and appropriate attention was paid to the function of research and development in the field of dairying during fifth five year plan (1974-79). During this plan period for the benefit of farmers particularly of weaker sections of Gujarat, Maharashtra, Uttar Pradesh and Orissa, a Project on Cattle breeding, farm forestry and food for work programme was taken up.

21.2.6 Sixth five year plan

Sixth Five year Plan (1980-85) laid special emphasis on projects for increasing the productivity of various indigenous species of livestock through genetic improvement and better healthcare. In this plan period necessary steps were taken to make available reliable and timely statistics of livestock. During this plan, a new development project was started in Sikkim, 3 integrated cattle - cum - dairy development projects were started in Rajasthan, Madhya Pradesh and Karnataka.

21.2.7 Seventh five year plan (1992-97)

21.2.7.1 Approaches and strategies

1. To provide necessary infrastructure to achieve the accelerated growth in livestock production.

2. To enable large section of rural population, including small and marginal farmers, labourers, tribal and weaker section to improve their nutritional and economic status by providing employment through livestock rearing.

3. To make available good breeding material for increasing productivity.

4. To strengthen animal health facilities, bringing them to the doorstep of farmers

5. To make available quality fodder seeds more widely.

6. To increase the coverage of area and farm facilities under co-operative dairy programs and improve milk handling, processing and marketing infrastructure.

7. Launching of technology mission for

i) Dairy cattle improvement (through embryo transfer tech.).

ii) Dairy development

Plan outlay was Rs. 1134.62 crores on AH and Dairying (Rs. 493.45 crores to be used for dairying only). Since 1950, total expenditure on AH and Dairying, during all the five year plans Rs.1584.17 crores.

21.2.8. Eighth five year plan (1992-97)

The emphasis was laid on enhancement of the productivity of milch cattle through upgradation by cross breeding. Frozen semen technology based upon progeny bulls is a major part of the programme. Drought intensity during the seventh five year plan has pointed to the need for integrating animal husbandry programme with the development of fodder. Programme for improving availability of fodder and seeds, development of pasture lands, feed analytical laboratories for analysis of various nutrients and toxins were taken up. The technology mission on dairy development was established to dovetail the activities of the central and state government.

21.2.9. Ninth five year plan (1997-98 to 2001-02)

Table 21.2 Proposed outlay for Ninth Five Year plan

Category	Amount (Rs. crores)	Percentage (%)
Animal health	552	28.1
Dairy development	485	24.6
Meat and meat products	396	20.2
Cattle development	151	7.7
All statistics	126	6.4
Fodder development	90	4.5
Poultry	90	4.5
Sheep, goat, rabbit	75	4.0
	1,965	100.0

The realities of post- GATT world reflected in the report of working group on animal husbandry and dairying for the formulation of 9^th five year plan.

21.2.9.1. Objective of ninth five year plan

1. Effective health coverage

2. To reduce economic loses due to diseases.

3. To enlarge export of livestock products.

4. Enforcement of international animal health code.

5. Harmonisation of vaccines and biological product in India.

Table 21.3 Expenditure on Animal Husbandry and Dairying during various plans (Rs Million)

Plan period	Total expenditure	Expenditure on
		Agriculture and allied activities	AH and Dairying	Dairying
I. 1951-56	19600	2900 (14.8)	160.0 (5.5)	77.8 (48.6)
II. 1956-61	46720	5490 (11.7)	334.7 (6.0)	120.5 (36.0)
III. 1961-66	85765	10890 (12.6)	770.0 (7.0)	336.0 (43.0)
Annual plan 1966-69	66254	11071 (16.7)	597.0 (5.4)	257.0 (43.0)
IV. 1969-74	157788	23204 (14.7)	1542.6 (6.6)	787. (51.0)
V. 1974-78	394262	48665 (12.3)	2324.6 (5.0)	540.3 (23.2)
Annual plan 1978-80	121765	19997 (16.4)	2087.7 (10.4)	1157.9 (55.5)
VI. 1980-85	1092917	136203 (12.5)	8025.1 (5.8)	4362.9 (54.4)
VII. 1985-90	2202163	279611 (2.7)	12805.0 (4.6)	6034.1 (47.1)
VIII. 1992-97	4341000	568926 (13.1)	28383.2 (5.0)	13075. (46.1)

*The figure in the parentheses give the percent

21.2.10. Tenth five year plan (2002-2007)

In the tenth five year plan, it was envisaged that Animal husbandry and dairying will receive high priority in the efforts for generating wealth and employment, increasing the availability of animal protein in the food basket and for generating exportable surpluses. The overall focus was on four broad pillars viz. (i) removing policy distortions that is hindering the natural growth of livestock production; (ii) building participatory institutions of collective action for small-scale farmers that allow them to get vertically integrated with livestock processors and input suppliers; (iii) creating an environment in which farmers will increase investment in ways that will improve productivity in the livestock sector; and (iv) promoting effective regulatory institutions to deal with the threat of environmental and health crises stemming from livestock. The Tenth Plan target for milk production was set at 108.4 million tonnes envisaging an annual growth rate of 6.0 per cent. The allocation for animal husbandry, dairying and fishery was Rs. 2500 crore during the Tenth plan. It was emphasized that use of technological and marketing interventions in the production, processing and distribution of livestock products will be the central theme of any future programme for livestock development. The generation and dissemination of appropriate technologies in the field of animal production as also health care to enhance production and productivity levels will also be given greater attention.

21.2.11. Eleventh plan (2007-2012)

Livestock plays an important role in Indian economy and is an important sub-sector of Indian agriculture. The contribution of livestock to the GDP is about 4.5% and the sector employs about 5.5% of the workforce. Livestock provides stability to family income especially in the arid and semi-arid regions of the country and is an insurance against the vagaries of nature due to drought, famine, and other natural calamities. Major part of the livestock population is concentrated in the marginal and small size of holdings. Growth during the Tenth Plan has been at the rate of 3.6%. 1.79 The goals for the Eleventh Five Year Plan for the livestock sector would be (i) to achieve an overall growth between 6% and 7% per annum for the sector as a whole with milk group achieving a growth of 5.0% per annum and meat and poultry group achieving a growth of 10% per annum; (ii) the benefit of growth should be equitable, benefiting mainly the small and marginal farmers and landless labourers and should benefit poorly endowed areas like draught prone, arid, and semi-arid areas; (iii) to provide adequate animal health services for effective disease control; (iv) the sector should generate additional employment opportunity to people in the rural areas especially to the female population; (v) livestock should provide major source of income in the selected areas having potential for mixed crop-livestock farming system; and (vi) the growth in the sector should result in the improvement of environment, specially in the rural areas. Market opportunities have opened up for the livestock sector following the economic liberalization. But the sector’s ability to capitalize on new market opportunity is constrained by the availability and quality of support services which, at present, are mainly provided by the government. Moreover, these services are not available at the doorsteps of the producers. There is a need to restructure service delivery mechanism to become conducive to the requirement of the rural livestock producers. Lack of credit for livestock production has been a major problem. Public sector lending is very low. The strategy should be to correct these distortions and ensure timely availability of inputs and services including credit to livestock farmers.

21.2.11.1. Goals and strategy of eleventh plan

1. The goals for the eleventh five year plan for the livestock sector would be i) to achieve an overall growth between 6% to 7% per annum for the sector as a whole with milk group achieving a growth of 5.0% per annum and meat and poultry group achieving a growth of 10% per annum, ii) the benefit of growth should be equitable, benefiting mainly the small and marginal farmers and landless labourers and should benefit poorly endowed areas like draught prone, arid and semi-arid areas iii) the sector should generate additional employment opportunity to people in the rural areas especially to the female population, iv) livestock should provide major source of income in the selected areas having potential for mixed crop-livestock farming system, and v) the growth in the sector should result in the improvement of environment specially in the rural areas.
2. Accelerating the growth in livestock sector between 6 to 7 per cent during the 11th plan would not be an easy task, since growth during the first four years of 10th plan has been less then 4% per annum. The strategy would require action on both supply and demand side besides the institutional restructuring. In past, the development programmes have been primarily based on public initiatives. With the increase in coverage, these programme have over grown in size. Their institutional structure has not changed to suit the changing requirement and remain in line with the fast changes in the technology. A sustainable and financially viable livestock farming, which will generate wealth and self-employment through entrepreneurship, is the need of the day. This would require creating an enabling environment in which farmers will increase investment to improve productivity of livestock and building participatory institutions that allow livestock farmers to get vertically integrated with processors of livestock products and input suppliers/service providers.
3. Market opportunities have opened up for the livestock sector following the economic liberalization. There are expectations of faster growth in demand for livestock products due to expected increase in income combined with the high income elasticity of demand for livestock products. But the sector’s ability to capitalize on new market opportunity is constrained by the availability and quality of support services. At present, Government is the main provider of these services. The quality of the services is however not satisfactory and these services are not available at the doorsteps of the producers. The present structure of livestock improvement is based on fixed model of a Veterinary Hospital/Dispensary being the key nodal structure at the ground level from where services and goods are currently distributed. There is a need to restructure service delivery mechanism to become conducive to the requirement of the rural livestock producers. Lack of credit for livestock production has been a major problem. Public sector lending is abysmally very low. The commercial banks are not favourably disposed to providing credit to livestock farmers and the cooperative credit system is very weak resulting in excessive dependent of livestock farmers on informal sources usually at exorbitant interest rates. The strategy should be to correct these distortions and ensure timely availability of inputs and services including credit to livestock farmers.
4. The Department of Animal Husbandry and Dairying is managing large infrastructure of livestock farms and fodder production stations. Many of the infrastructures are out dated and have not kept pace with the development of science and technology. An exercise on restructuring the existing infrastructure needs to be taken up on priority basis. An institution like Delhi Milk Scheme, which is suffering huge losses, has lost relevance and should be closed and sold out. An authority to supervise quality control on production and marketing of breeding material, vaccine and other biological should be set up. To advise the Department of Animal Husbandry and Dairying on policy matters, establishment of a National Institute for Livestock Information and Policy Studies is recommended. Similarly the large number of livestock farms managed by the State Governments should be reorganized and the production of vaccine and other biological materials should be privatized.
5. Establishment of a separate Indian Council for Veterinary and Animal Science Education and Research by carving out animal science institutes from ICAR and placing them with Department of A.H &D would provide better coordination between the research and developmental efforts in livestock sector.

21.2.11.2. Proposed Developmental Programme in 11^th Plan

1. Adequate availability of quality fodder is essential for enhancing livestock productivity. For this, there is need to target at least ten percent of the cultivable land for growing fodder crops. Since major limitation to increasing fodder production is insufficient availability of fodder seeds, a programme on fodder seed production through registered growers would be launched in collaboration with State Agricultural Universities and State Seed Corporations. Assistance would be provided for better use of crop residues through industrial manufacture of feed blocks using crops residues, briquettes, and utilization of agro- industrial byproducts. The projects on development of Common Property Resource (CPR) and fodder banks would be implemented as public private partnership initiative (PPP).
2. The National Cattle and Buffalo Breeding Project (NCBBP) would continue to the major initiative in cattle and buffalo development. Emphasis would be on using only quality bulls. Ordinarily, only progeny tested bulls should be used in such a breeding programme, however in the absence of availability of such bulls, attempts would be made to identify the best males from the available sources. The Embryo Transfer Technology (ETT) would be made use of in the production of bulls in the absence of progeny testing. Import of frozen semen and embryo from high producing herds would be required for breeding the bull mothers maintained in the country. Out of existing 54 functional semen stations, 10 bigger semen freezing stations would be strengthened with the state of art facility to produce annually 40 to 50 million doses. The AI services would be privatized and delivered at the doorsteps of the livestock farmers. An information network for breeding services would be established.
3. Major policy reforms are required to provide support to small ruminant developmental programme. The grazing policy for livestock in forest including joint forest management with particular reference to high altitude forest needs to be developed and jointly implemented by Animal Husbandry and Forest Departments. Regeneration and development of common property resources and wasteland with involvement of Panchayats and NGOs need to be given greater attention. It is proposed to launch this programme in 40 backward districts in 6 states having high population of sheep and goats.
4. Under Dairy Development, milk producers cooperatives will continue to play major role despite liberalization of the sector. However, the dairy cooperatives will have to reform themselves and become competitive. NDDB is setting up a consortorium with NABARD and NCDC to fund the dairy cooperatives. The venture capital fund for dairy and poultry development set up in the 10th plan would be expanded. Primary attention would be given on creating infrastructure for production of clean milk and to improve the processing, marketing and transport facility. The processing capacity shall have to be expanded both in the cooperative and private sector. R & D efforts in developing process and packing technology for Indian milk products as also other innovative milk products would be supported.

21.3 Important Developments in Different Five Year Plans

Five year plan	Key developments
First Five Year Plan (1951– 56)	· Establishment of Key Village Schemes (1952) · 146 key village blocks with AI centres · Establishment of 650 veterinary hospitals
Second Five Year Plan (1956 – 61)	· Establishment of 196 key village blocks with 670 AI centres · Establishment of 1900 veterinary hospitals
Third Five Year Plan (1961 – 66)	· 143 government milk supply schemes in big towns · Establishment of NDDB · Establishment of a separate department for dairy development in each State
Fourth Five Year Plan (1969 – 74)	· Launch of Operation Flood, phase I · Establishment of progeny testing scheme –All India Co-ordinated Project on Buffaloes · Shift of breeding policy from dual purpose cows to cross-bred cows · Formation of Indian Dairy Corporation
Fifth Five Year Plan (1974 – 79)	· Implementation of Operation Flood, phase II
Sixth Five Year Plan (1980 –85)	· Establishment of frozen semen stations in different States
Seventh Five Year Plan (1985 – 90)	· Implementation of Operation Flood, phase III
Eight Five Year plan (1992-97	· Frozen semen technology based upon progeny bulls
Ninth Five Year plan (1997-02)	· Effective health coverage to reduce economic losses due to diseases
Tenth Five Year Plan (2002 – 07	· Conservation of threatened indigenous breeds
Eleventh Five Year Plan (2007 – 12)	· National Agricultural Development Programme (NADP) · National Project for Cattle and Buffalo Breeding(NPCBB)