Govt sets up Dairy Investment Accelerator to promote dairy sector investments

The Department of Animal Husbandry & Dairying (DAHD), Government of India, to provide dedicated focus towards promoting and facilitating investments in the Indian Dairy sector, has set up Dairy Investment Accelerator under its Investment Facilitation Cell. This Investment Accelerator is a cross-functional team constituted to serve as the interface with investors. It shall provide support across the investment cycle:

• Offering specific inputs for evaluation of investment opportunities

• Addressing queries about the application to govt schemes

• Connecting with strategic partners

• Providing on-ground assistance with state departments and relevant authorities

Further, the Dairy Investment Accelerator will work with DAHD to organize a series of events with global and local industry participants and one-on-one discussions with the investors to understand their perspectives, facilitate direct interactions with government officials, and connect with other industry players.

Dairy Investment Accelerator also generates awareness among investors about the Animal Husbandry Infrastructure Development fund (AHIDF). AHIDF is one of the flagship schemes by DAHD, Government of India whereby Rs 15,000 crore fund has been set up to offer financial support to entrepreneurs, private companies, MSME, Farmers Producers Organizations (FPOs) Section 8 companies. Eligible entities can avail the scheme's benefits to set up new units or expand existing units in areas of dairy processing and related value addition infrastructure, meat processing and related value addition infrastructure and Animal Feed Plant. The benefits available are:

• 3% interest subvention on loans

• 2-year moratorium with a 6-year repayment period

• Rs 750 crore credit guarantee

The DAHD encourages all the private companies, individual entrepreneurs, and start-ups interested in investing in the dairy sector to reach out to the Dairy Investment Accelerator on dairy-accelerator@lsmgr.nic.in.

According to the press note, India is the largest milk producer contributing 23% of global milk production. The country's annual milk production has grown by 6.4% (CAGR) in the past five years. Dairy is a high-priority sector for the Government of India due to its socio-economic significance. It is the single largest agricultural commodity contributing 5% of the national economy and employing 80 million farmers directly. Further, the country boasts large domestic packaged dairy products worth Rs 2.7-3.0 lakh crore, witnessing solid double-digit growth.

The market growth in Dairy requires the support of significant infrastructure investment across processing, chilling, logistics, and cattle feed. Further, lucrative untapped opportunities exist in value-added dairy products, organic or farm-fresh milk and exports. The dairy sector has seen substantial foreign direct investment (FDI), constituting about 40% of FDIs Indian food sector. To facilitate infrastructure growth, central or state Governments have released various incentives to attract investments in this sector.