CCEA approves upward revision of interest subvention from "upto 2%"​ to "upto 2.5% p.a."

The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Shri Narendra Modi, has given its approval for upward revision of interest subvention from "upto 2%" to "upto 2.5% p.a." under the scheme Dairy processing and Infrastructure Development Fund (DIDF)with the revised outlay of Rs 11184 Cr. The scheme envisages to have interest subvention component of Rs 1167 crore to be contributed by DAHD during the period of 2018-19 to 2030-31 with spill over to first quarter of the FY 2031-32. The scheme also has a loan component of Rs. 8004 crore to be contributed by NABARD. Rs. 2001 cr shall be contributed by Eligible End Borrowers and Rs. 12 cr would be jointly contributed by National Dairy Development Board (NDDB)/National Cooperative Development Corporation (NCDC)

NABARD shall endeavor to keep the cost of borrowings to the minimum. NABARD shall devise its own strategy for borrowing so that it takes advantage of lower interest rate in the markets to provide low cost of funds to the Milk Unions. NABARD should immediately initiate action plan for prompt disbursement of funds as and when the market is conducive to raising funds at affordable rates.


  • 95 Lakh milk producers will be benefited by covering 50,000 villages.

  • Establishment of 28000 Bulk Milk Coolers with 140 Lakh Litres per Day as additional milk chilling capacity.

  • Creation of additional 210 Metric Ton per Day Milk Drying capacity.

  • Modernization, expansion and creation of Milk Processing capacity of 126 Lakh Litres per Day.

  • Creation of Infrastructure of 59.78 Lakh Litres per Day capacity for Value-Added Dairy products to ensure remunerative prices to milk producers.

  • Providing 28000 Milk Testing Equipment to check adulteration in milk.

NABARD raises funds from the market, which it lends to NDDB/NCDC @ 6.0% and NDDB/NCDC, in turn, lends it to the Eligible End Borrowers at appropriate interest rate. DAHD provides interest subvention equal to the difference or upto 2.5% between the cost of raising capital by NABARD and the interest rate at which NABARD lends to NDDB/NCDC