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  • Writer's pictureDr. P.K. Shrivastava

Indian Dairy industry expected more from the Union Budget-2023

Honorable finance minister (FM) presented the Union Budget-2023 on 01.02.23, this article looks at the budget allocation for Dairy sector.

It is visible that our Honorable FM has laid foundation for the India@100, through this budget. The Saptagiri identified reflects on inclusive development and not the sect-oral development. It touches mostly the vital areas for marching on the road-map for India@1000.

However, the dairy, which is continuously improving its contribution in the Indian GDP, increasing its share to the Agriculture GDP and also proved as one of the best rural and urban employment providers for unemployed youth, besides supporting about 80 million farmer families directly and much more indirectly, a regular income generation activity, improving the nutritional status of the consumers, strengthening the social reorganization and social bindings in our society, as dairy is considered “any time fund” for farmers; the industry expected much more from the budget-2023, being a pre-budget to the parliamentary election next year.

The expectations of dairy industry are not unjustified, it is based on the ground that India remained highest milk producer in the world for the past more than 25 years (milk production 210 million tons in 2020-21) and 2nd most producer of cow milk in the world and about to become 1st in cow milk production in the world, contributing about 23% of the total world milk production, the industry expected more from the Union Budget-2023.

Indian dairy productivity grows @6.2% CAGR, is the result of “production by masses, not by mass production”, very well said by our honorable prime minister during inaugurating the “International Dairy Federation World Dairy Summit India in Sept 2022”. It means that the Indian Govt is serious about the growth of dairy farmers, hence the expectations were more from the Union Budget-2023 for dairy.

The Saptarishi (Figure 1), identified in this budget shows the intent of the Union Govt to boost the dairy industry in India. Hope that Saptarishi like "inclusive development", "infrastructure & investment" , "green growth" and "youth power" would also address core issues of dairy sector, which did not find apparent allocation in this budget.

Since dairy development in India is by masses, it would need the efforts to travel to the masses; hence the expectations for the core issues of dairy like; infrastructure for processing, cold-chain, quality of milk & milk products, support to dairy star-ups under MSME, support towards improving fodder cultivation (a real concern for dairy farms), free skill development training to opt commercial dairy etc., should have been addressed. The allocation of INR 6000 Cr for fisheries, despite its contribution of only 7% (much low than the dairy), might have been done on some valid reasons, experts may comment on that.

Figure 1: The Saptarishi of the Union Budget 2023

In brief the Union Budget-2023 has addressed the followings, which shows Govt’s intent to support the dairy development activities:

  • Budget allocation for dairy development has been nominally increased from INR 3000 Cr to INR 4327 Cr in this budget

  • It has kept Rashtriya Gokul Mission allocation same at INR 600 Cr as last year

  • Little increase in NLM allocation been done from INR 350 Cr to 410 Cr

  • Agriculture acceleration fund-for innovative start-up in rural area is maintained

  • Target funding (by Fin Institutions) for Agri, Dairy and fisheries at INR 20 Lack Cr

  • Support to dairy Union/Federation raised from INR 220 Cr to INR 323 Cr

  • Good that the National Mission on Bovine productivity has been merged with RGM, which covers “Breed Multiplication Scheme” (BMS), implemented by NDDB to conserve indigenous breeds of cattle & Buffalo, where the subsidy is up to 2 Cr

  • Govt will promote 1 Cr natural farming, means more use of manure and reduction in GHG

To me (I am only a dairy expert) the allocations in the Union Budget-2023 are satisfactory. It is matter of research that how funds have been allocated for other related ministries like “Food Processing Industries”, ministry of “Industry & Cooperation”, etc, to arrive at a conclusion, as the dairy activities are funded for the projects by these industries also. I believe, the Govt must have seen all these before allocating funds for Dairy development. If the collective efforts are there at Macro & Micro levels, from all corners, the dairy growth would be accelerated in years to come.


Dr PK Shrivastava

Dairy Business Consultant (Dairy Guru)

M/s Dairy Consultancy India, Bangalore

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