DIDF in Brief

DIDF - Dairy Processing & Infrastructure Development Fund

Large number of dairy processing plants with India’s Dairy Cooperatives were commissioned during Operation Flood which ended in 1996. Majority of these plants have never been expanded and/or modernised thereafter. These plants are operating with old & obsolete technologies, which may not be energy efficient as compared to currently available modern technologies. In order to improve efficiencies as well as increase production of products with higher value addition, replacement and modernisation of these dairy plants is essential.

Considering the interests of both producers and consumers, Dairy Cooperatives pass on maximum share of sales realisation (generally about 75-80%) to milk producers and make available safe milk to the consumers at an affordable price. As a result, , they are unable to invest in modernisation and/or expansion of dairy processing infrastructure since they have limited resources due to relatively low profit margins. To ensure that Dairy Cooperatives remain competitive for the sustained benefit of farmers, the Government of India had announced creation of Dairy Processing and Infrastructure Development Fund under NABARD with a total corpus of Rs. 8000 crore over a period of 3 years (i.e. 2017-18 to 2019-20), in the Union Budget of 2017-18.

DADF, Government of India (GoI) has issued the administrative approval of the Central Sector Scheme - ‘Dairy Processing & Infrastructure Development Fund (DIDF)’ dated 21 December 2017. DIDF scheme will be implemented with a total investment outlay of Rs. 10,881 crore comprising Rs. 8004 crore as a loan from National Bank for Agriculture and Rural Development (NABARD), Rs. 2001 crore as End Borrower’s contribution, Rs. 864 crore as GoI’s Interest Subvention and Rs. 12 crore by National Dairy Development Board (NDDB) and National Cooperative Development Corporation (NCDC) on pro rata basis towards Project Management & Learning.

Funding will be in the form of interest bearing loan, which will flow from NABARD to NDDB/NCDC and in turn to eligible End Borrowers.

Objectives of the scheme - The scheme have been designed with the following objectives:

  • To modernize the milk processing plants and machinery and to create additional infrastructure for processing more milk.
  • To create additional milk processing capacity for increased value addition by producing more dairy products.
  • To bring efficiency in dairy processing plants/producer owned and controlled dairy institutions, thereby enabling optimum value of milk to milk producer farmers and supply of quality milk to consumers.
  • To help the producer owned and controlled institutions to increase their share of milk, thereby providing greater opportunities of ownership, management and market access to rural milk producers in the organized milk market.
  • To help the producer owned and controlled institutions to consolidate their position as dominant player in the organised liquid milk market and to make increased price realisation to milk producers.

Scheme Area - The scheme will be implemented across the country.