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The Central government will provide Kisan Credit Card (KCC) to 1.5 crore dairy farmers belonging to milk unions and milk producing companies within the next two months, from June 1, 2020 to July 31, 2020 under a special drive. The Department of Animal Husbandry and Dairying in association with Department of Financial Services has already circulated circulars and KCC application format to all state milk federations and milk unions for implementing the same on a mission mode, the Ministry of Fisheries, Animal Husbandry & Dairying has said in a press note.
Under the dairy cooperative movement, approximately 1.7 crore farmers are associated with 230 milk unions in the country.
According to the ministry, in the first phase of this campaign, the target is to cover all farmers who are members of dairy cooperative societies and associated with different milk unions and who do not have KCC. Farmers who already have KCC based on their land ownership, can get their KCC credit limit enhanced, though interest subvention shall be available only to the extent of Rs 3 lakh. Although the general limit for KCC credit without collateral remains Rs. 1.6 lakh, but the case of farmers whose milk is directly procured by milk unions falls under tie-up arrangements between the producers and processing units without any intermediaries, and hence the credit limits without collateral can be upto Rs.3 lakh. This will ensure more credit availability for dairy farmers associated with milk unions as well as assuring repayment of loans to banks.
The special drive to provide KCC to 1.5 crore dairy farmers is part of the Prime Minister’s Aatma Nirbhar Bharat package for farmers. Finance Minister Nirmala Sitharaman on May 15, 2020 had announced to cover 2.5 crore new farmers under the KCC scheme. This will provide an additional liquidity of Rs.5 lakh crore in the hands of farmers, who are suffering from the recent downturn of economy, the note has further said.
As, dairy is among the fastest growing sectors of the economy with a compound annual growth rate (CAGR) of above 6 percent in the last five years, providing short term credit to dairy farmers for meeting their requirements for working capital, marketing among others will boost their productivity.