Objectives and Eligible Dairy Activities
NABARD channels concessional credit through commercial banks, regional rural banks (RRBs), and state cooperative banks to upgrade the dairy sector.
The scheme aims to promote modern milk production, encourage rearing of high-yielding milch cattle, and establish cold-chain milk chilling centers.
- Small Dairy Units: Setting up 2 to 10 crossbred cows or graded murrah buffalo units with modern cattle housing
- Commercial Dairy Enterprises: Establishing larger mechanized dairy herds of 20 to 50 animals with milking machines
- Milk Chilling & Processing: Purchasing bulk milk coolers, automatic milk collection units, and refrigerated transport vans
- Breeding Infrastructure: Establishing private veterinary clinics, artificial insemination centers, and calf rearing units
Subsidy Structure and Financial Patterns
Under central livestock development schemes implemented in coordination with NABARD, eligible beneficiaries receive back-ended capital subsidies.
The subsidy is held in a subsidy reserve fund account by the lending bank and adjusted against the final loan installments upon successful project inspection.
- General Category Beneficiaries: Capital subsidy percentage up to 25% of the approved project cost
- SC / ST Beneficiaries: Enhanced capital subsidy up to 33.33% of the approved capital investment
- Bank Loan Component: The lending bank finances 65% to 75% of the project cost as a medium-term term loan
- Beneficiary Margin: The promoter contributes 10% to 25% as equity margin depending on project scale
Application Process and Essential Documentation
Farmers, individual entrepreneurs, self-help groups (SHGs), and Farmer Producer Organizations (FPOs) can apply through their local bank branches.
A viable Detailed Project Report (DPR) outlining land availability, water resources, green fodder cultivation, and milk marketing tie-ups is required.
- Required Documents: Land ownership papers or lease deed, Aadhaar card, PAN card, bank account statements, and passport photographs
- Detailed Project Report: Outlines cattle breed selection, housing layout, feed costs, expected lactation yield, and cash flow projections
- Repayment Tenor: Typically structured over 3 to 7 years with a grace period of 3 to 6 months
Official source
Check the latest rules, benefits and forms here. KisanPe is an independent platform and is not a government website.
National Bank for Agriculture and Rural Development ↗Related on KisanPe
Common questions
What is the subsidy percentage under government dairy schemes via NABARD?
Eligible general category applicants can receive up to 25% capital subsidy, while SC and ST applicants receive up to 33.33% under designated livestock schemes.
Can small farmers get a loan for 2 to 10 dairy cows?
Yes, financing for small dairy units of 2 to 10 milch cows or buffaloes is a primary focus of institutional dairy credit.
What is a back-ended subsidy in bank dairy loans?
A back-ended subsidy is credited by the government to a special reserve fund account at the bank and deducted from the final loan repayment balance.
General guidance, not personal advice. For your farm, ask your local Krishi Vigyan Kendra or agriculture officer.
More Government Schemes & Subsidies guides
Ask Sakhi AI in your language, check live mandi prices or plan a loan with KisanPe tools.