Dr.

N N Dastur Memorial Lecture

Leveraging Animal Wealth for Small Farmers Prosperity
9 February 2015

Dr. Harsh Kumar Bhanwala

Chairman
National Bank for Agriculture and Rural Development (NABARD), Mumbai

It is my honour that I have been asked to deliver the prestigious Dr.N. N. Dastur Memorial Lecture. I
have accepted the invitation, as an excellent opportunity to pay homage to a towering personality. As
we all know, Dr.Dasturs contribution to teaching and research and to institution building in dairy
sector was immense. National Dairy Research Institute (NDRI) is in an enviable position, thanks to the
guidance of luminaries like Dr.Dastur and Dr.K.K.Iya, among others. NDRI has several firsts to its credit
and it has left its mark in research, education and extension. As an alumnus of this great Institution, I
am very proud and congratulate you all for continuing the legacy under the able leadership of Dr.A. K.
Srivastava, Director General and Vice Chancellor. Befitting the occasion, I would like to speak on
animal wealth and how to leverage it for improving the prosperity of small farmers. I would cover the
role of animal farming in the lives of the small farmers and weaker sections, its contribution to the
economy and the ecology.

India has worlds largest animal wealth

As per the 19th All India Livestock Census, total livestock population in the country in 2012 was over
512 million, largest in the world, even as there was a decline of 3.33 per cent over 2007 (Table 1). In
addition to this, poultry birds numbering 729 million and fish further appreciate the wealth we have.

Table 1. Animal wealth in India

(Number in 000)
Animal category 2007 2012 % change
Cattle -Total 1,99,075 1,90,904 -4.10
- Exotic/crossbred 33,060 39,732 20.18
- Indigenous 1,66,015 1,51,172 -8.94
Buffaloes 1,05,342 1,08,702 3.19
Sheep -Total 71,558 65,069 -9.07
- Exotic/crossbred 3,730 3,781 1.37
- Indigenous 67,828 61,288 -9.64
Goat 1,40,537 1,35,173 -3.82
Pig -Total 11,133 10,294 -7.54
- Exotic/crossbred 2,389 2,456 2.80
- Indigenous 8,744 7,837 -10.37
Other animals 2,051 1,915 -6.63
Total Livestock 5,29,696 5,12,057 -3.33
Rabbit 424 592 39.62
Poultry 6,48,829 7,29,209 12.39
Source: Livestock Census, 2007 and 2012.
One interesting trend observed in the composition of livestock is that indigenous species of cattle,
sheep and pigs declined between 2007 and 2012 while that of crossbred/exotic population increased,
which reflects the market orientation of producers. Poultry recorded 12.39 per cent increase between
these two years touching many lives.

We have an enormous and diverse animal wealth that generates primary as well as supplementary
livelihood opportunities for millions of people. Are we able to tap this wealth for the benefit of the
people involved in rearing and tending them as also the consumers who demand the produce from
animal farming activities?

Animal farming is pursued as an adjunct activity

Barring a few big dairy enterprises, animal farming is pursued in India as a complementary activity
besides crop cultivation. As we know, when only one of the complementary activities is scaled up, the
other activities may get less resources including managerial capacity. With major encouragement
given to crop production to tide over the food crisis during 1960s, crop sector raced ahead. However,
of late, several entrepreneurs have taken up livestock enterprises as a standalone commercial activity.
The livestock sector has emerged ahead as the relative contribution to Indias Gross Domestic Product
reveals (Table 2). Livestock sector accounted for 28.33 per cent of GDP originating in agriculture
during 2011-12 which is substantially higher compared to 13.88 per cent in 1980-81 and 20.00 per
cent in 1990-91.

Table 2. Contribution of Livestock sector to Gross Domestic Product (GDP)

Year % share in Agri GDP % share in total GDP % share of agriculture to

total GDP
1980-81 13.88 4.82 34.73
1990-91 20.00 5.75 28.75
2000-01 24.23 5.29 21.83
2011-12 28.33 3.41 12.02
Source: CSO, National Statistical Accounts (various years)

Livelihood support

Animal farming supports a sizeable chunk of livelihoods, both in rural and urban areas. According to
NSSO survey (70th round) of Land and Livestock Holdings in India, 1.75 per cent of the rural households
(HH) are directly engaged in livestock farming as a major source of income. When we take
contribution of different livelihood options to the income during the 365 days preceding the survey
date, 37 out of 1000 HH i.e., 33,37,000 HH, depended on livestock as a principal source of income
(Table 3). What is important to note here is the fact that 22.9 per cent of the landless HH and 9.6 per
cent of marginal and small farmers (up to 2 hectares) depend on livestock as a major income source.
Table 3. Distribution of agricultural households by principal source of income during 365 days
preceding survey date

Farm Size Cultiva Livest Other Non- Wage/ Others All Est. no of
tion ock agricul agricult salarie agricultur
tural ural d al HH (00)
activity enterpri emplo
ses yment
<0.01 16 229 27 108 564 55 1000 23,890
0.01 - 0.4 421 48 12 75 352 93 1000 2,87,663
0.4 - 1 692 23 9 36 200 41 1000 3,14,811
1-2 830 25 9 32 86 18 1000 1,54,577
2-4 859 24 11 16 71 18 1000 84,345
4 -10 879 27 5 9 59 20 1000 33,019
10& above 894 55 15 18 17 1 1000 3,706
All farm sizes 635 37 11 47 220 51 1000 9,02,011
Source: National Sample Survey Office (NSSO), 2014. Key Indicators of Situation of Agricultural Households in
India, NSS 70th Round, Jan- Dec 2013, Ministry of Statistics and Programme Implementation, GoI, New Delhi.

Viewed in terms of income generated, net receipts from farming animals was Rs.763 per HH i.e., 11.9
per cent of the total income from all sources at Rs.6,426 (Table 4). The share of income from livestock
was 25.9 per cent for landless HH while it was 11 to 15 per cent for other HH categories owning less
than 2 hectares. This places onerous responsibility on all of us, i.e., policy makers, line departments,
bankers, scientists and academicians to work towards improving the productivity, profitability and
sustainability of livestock sector.

Table: 4. Farm size-wise share of animal farming in income generation

S No. size class of land possessed net receipt from total income % share of total
(ha) animal farming from all income from
(Rs) sources (Rs) animal farming
1 <0.01 1,181 4,561 25.9
2 0.01 - 0.4 621 4,152 15.0
3 0.4 - 1 629 5,247 12.0
4 1-2 818 7,348 11.1
5 2-4 1,161 10,730 10.8
6 4 -10 1,501 19,637 7.6
7 10& above 2,622 41,388 6.3
All farm sizes 763 6,426 11.9
Source: Same as that for Table 1.
 Relation between share of income from
animal farming and farm size
30.0
share in income %

20.0

10.0

0.0
1 2 3 4 5 6 7
farm size category Sl No.

Gender Perspective

Traditionally livestock farming helped empower women who were primarily engaged in attending
related activities. Successful homemakers among rural households were those who could leverage
their animal stock to take care of the family and farm needs. Women had a special bonding with
animals who were like their ATMs. Even today, women are employed in this sector on a significant
scale. According to 66th round of NSSO survey (2009-10), 1.6 per cent of males and 9.5 per cent of
females usually worked on principal as well as subsidiary basis in farming of animals. Additionally, 0.3
and 0.6 per cent of males and females are respectively involved in service activities related to animal
husbandry performed on farm (other than veterinary activities).

Periodic NSSO surveys on assessing participation of women in HH work and specified activities reveal
the extent to which women were employed in different activities in both urban and rural areas in
addition to household duties. Table 5 below gives a snapshot of the results pertaining to their
engagement with livestock sector. Data shows that sizeable proportion of women in rural areas are
engaged in livestock related works including cow dung cake making. The list here does not include
activities like cutting grass, preparing feed, feeding animals, milking, making and marketing value
added items like curd, butter and ghee. Including that would give us the real magnitude of
engagement of women with dairy. Apart from the women already engaged in dairy activities in
addition to domestic duties, in 2009-10, 121 out of every 1000 rural women expressed their
willingness to accept work related to dairy, poultry and other animal husbandry related works.

Table 5. Women (15 years &above) were employed in different activities in both urban and rural areas
in addition to household duties (per 1000)

Specified additional activities 1999-2000 2009-10

Rural Urban Rural Urban
Work in HH poultry etc. 319 44 254 33
Preservation of meat (own produce) 9 3 12 5
Preservation of meat (acquired produce) 68 65 51 34
Preparing cow dung cakes 482 59 424 56
Women willing to accept work in livestock 151 38 121 24
related works
Source: National Sample Survey Office (NSSO) reports on Participation of women in household work and other
specified activities for the years 1999-2000 (Report No. 465 (55/10/5) and 2009-10 (Report No.550 (66/10/5).
Income augmentation and risk management

Income augmentation for farmers, especially of small farmers and the landless, as seen above, is the
primary contribution of livestock segment towards farmers economy. The other roles animal farming
segment play have been traditionally understood and acknowledged. A farmer could not have been
visualised without possessing at least a pair of animals for draught and milk. Animals were integral
part of farming where they helped cope with the risks associated with crop cultivation by smoothening
the income flow during the year. Besides, animals give food and fuel for humans and manure for farms
while eating left overs and by-products from crop cultivation which is otherwise considered waste.
Thus, one can operate an animal farm with zero cost and generate good income by mere by-product
management between different livelihood activities on the farm. Farming systems approach, hence,
is the need of the hour especially with the overwhelming patronage of organic products in recent
times.

Contribution to Nutritional Security

After the initial drive for increasing food production, the attention slowly shifted to quality of food.
With Operation Flood, the country achieved record milk production and per capita milk production
improved. On poultry and fisheries front also India made significant progress. Some achievements
are mentioned in Table 6 below.

Table 6. Per capita availability of milk and eggs

Year Per capita milk available (gm/day) Per capita eggs available (no/year)
1950-51 130 5
1960-61 126 7
1980-81 128 15
1990-91 176 25
2000-01 217 36
2010-11 281 53
2011-12 290 55
Source: Basic Animal Husbandry and Fisheries Statistics 2013 published by Department of Animal
Husbandry, Dairying and Fisheries, Ministry of Agriculture, Krishi Bhavan, GoI, New Delhi
It is very much clear from the above data that the milk available per capita more than doubled over
last 60 years or so after hovering around 130 during the initial three decades. We could almost reach
the nutritional requirement norm of 300 grams/day during the last one and a half decades. Egg
production in the country increased to 75 billion now from less than 2 billion during early 1950s. As a
result, an average person who was able to get one egg to eat in more than two and a half months
during early 1950s is now able to eat one egg a week. Meat production too increased significantly to
reach 5.5 million tonnes in 2011-12.

Livestock and Trade

Table 7 gives the value of trade in livestock and its products. The trade balance is positive as exports
valued at Rs. 309 billion exceeded the imports valued at Rs.72 billion, by over three times. The
livestock sector trade with outside world is very modest compared to the potential external demand.
In fact, the domestic demand itself is growing due to growing incomes. The magnitude of trade is very
low partly because of huge domestic demand and partly because of high quality standards imposed
on exported items. In fact, even domestic customers are particular about the quality standards and
hence, in future unless our farmers adapt best practices in handling the livestock products they would
be edged out of the market.

Table 7. Value of trade in Livestock and Livestock products during 2011-12

(Rs. Million)
Broad Group Import Export
Livestock 520.0 616.5
Meat and Edible meat Offals 79.8 1,40,743.9
Dairy and Poultry products and 12,191.9 9,982.3
honey
Animal Fodder and feed 11,886.5 1,23,086.9
Raw hide and skins & leather 25,888.5 23,756.7
Raw wool and animal hair 21,361.2 10,478.8
All groups 71,928.0 3,08,665.1
Indias total trade 2,34,54,632.4 1,46,59,593.9
Source: Directorate general of Statistics & Commercial Intelligence, Calcutta

Why animal farming is best suited for weaker sections and small farmers?

As we have seen earlier, small farmers and landless have been depending on livestock for their
livelihoods in a significant way as the sector gainfully engages them and their families. The sector is
also able to supply manure for their farms besides supplementing nutritional needs of their families.
All these have helped them save costs in farming. Small farmers are known to be vulnerable to risks
more intensely than large farmers. They and their family members are not engaged enough on their
tiny farms. Also, their access to capital is limited. In such circumstances, a complementary activity
like animal farming integrates well with the familys economic crusade against unemployment,
poverty and uncertain income flows from the main activity. Most importantly, the investment in
animal farming is divisible. That is, a farmer can keep a couple of animals or scale up to higher number
by adding to his stock at his convenience. He can keep increasing his stock in a cost effective way by
natural process also without any additional investment. He can go for a poultry unit of a few hundred
birds or can even supplement his income by going for a few birds in the backyard. He can maintain a
bigger unit of sheep or goat or keep a few animals to keep the cash flowing. One more important
advantage is that small producers can easily aggregate their milk or eggs or broilers through different
available arrangements with proven success. For milk, farmers can go for cooperative model which
AMUL has rolled out. They can even market through private dairies. Dairy cooperatives have a proven
track record in organising dairy farmers across the country with about 1.5 lakh cooperatives having a
member base of a little less than 150 million. For poultry, contract farming model is quite popular in
a few states.

Contribution to Sustainability

One advantage the village poor can leverage is the availability of village commons. As we all know,
the common lands are joint property of the entire community and each family can draw benefits from
them. Over time the commons have deteriorated and have been cornered by the elite. However,
they are still able to cater to about one-fourth of the input needs of the landless and the marginal
farmers as revealed by a recent study titled, 'A Commons Story: In the Rain Shadow of Green
Revolution' conducted by Foundation for Ecological Security, Anand, Gujarat and funded by NABARD.
About 20 to 40 per cent of the income of households is contributed by the commons. Notably, this
study establishes a strong linkage between commons and production systems including livestock
and crop cultivation. The study also indicates that higher the contribution from commons and
livestock, lower is the vulnerability of households and lower is their dependence on wage labour.
Commons contribution to rural production is significant with 37-68% of annual fodder requirement
being met from them across all regions. The landless and marginal landholding groups are critically
dependent on Commons.

Clean fuel for masses

A large number of countries in the world including India are currently passing through the critical
phase of population explosion and the growing population demands more energy. Most of the
resources like petroleum, natural gas, coal are not sustainable sources of energy. Indias per capita
energy consumption is as low at 700 kWh against the worlds average of 2,500 kWh, and there is
deficiency of energy supply to meet national needs. Dung and left over organic waste can be used to
produce biogas in a cost effective manner. This form of energy is a good substitute for LPG cooking
gas and is healthier than the smoky alternatives that tend to degrade forests and woods. Bio CNG
which can be bottled can be a cost effective alternative that can be derived from biogas by purifying
it. This opens up new avenues for use of biogas.
Co-operatives

As you all know, a co-operative is nothing but a group of people acting together to meet the common
needs and aspirations of its members, sharing ownership and making decisions democratically.
Members of a co-operative benefit from the cooperative action because they have access to the
products and services that they need; profits tend to remain in the local economy and create
employment opportunities, thereby strengthening the local community. In a co-operative, the focus
is not to maximise profits but to maximise value for the members. The AMUL co-operative model
showed how a cooperative can be an effective way for people to address their own economic needs.

Credit and non-credit Support

Often we hear that credit is a major constraint for many economic activities. Several studies pointed
to this and even after decades of efforts to improve access to credit, there are inter-personal and
inter-regional disparities and low penetration of institutional credit especially among vulnerable
segments. NABARD has been promoting Self Help Groups and Joint Liability Groups, farmers clubs
and producer organisations to take care of credit access to disadvantaged sections. Various
promotional programmes, both under farm and non-farm sectors, accompanied credit related
interventions to provide credit plus advantage to the people. In case of animal husbandry activities,
dairy is the most popular investment avenue for farmers and the bankers as the activity keeps the
cash flowing for farmers as well as bankers. NABARD has been supporting credit flow to dairy and
other animal farming activities. The refinance assistance provided by NABARD to animal husbandry
sector during last five years is given in Table 8.
Table 8. Refinance disbursement to Animal Husbandry sector by NABARD
(Rs. Million)

Activity 2009-10 2010-11 2011-12 2012-13 2013-14

Dairy 7,253.5 9,181.1 8,898.9 8,728.7 9,318.9
Development
PF/SGP/AH 3,497.9 4,023.7 6,802.0 4,112.9 6,205.9
others
PF-Poultry Farming, SGP-Sheep, Goat and Piggery
Source: NABARD, Annual Report, various issues.
NABARD has been playing an active role in promotion of dairy sector in the country through number
of interventions aimed at augmenting milk production, improvement in feed and fodder availability,
implementing subsidy schemes of Government of India (GoI), etc, as also directing credit through
liberal refinance assistance. The different initiatives taken up by NABARD in dairy sector are as under:
Providing subsidy to milk producers for augmenting their herd size and taking up commercial
dairy farming under GoI scheme namely 'Dairy Enterpreneurship Development Scheme'
Supporting several other GoI schemes by acting as a proactive pass through agency
Development of 'Area Development Schemes on Dairy'
Development of Veterinary Infrastructure under RIDF
Supporting rural industries related to livestock
Supporting producer organisations
NABARD Consultancy Services (NABCONS): A wholly owned subsidiary of NABARD is providing
consultancy services, techno-feasibility reports etc. in different activities of Animal Husbandry
sector.
Here I would like to mention about the integrated dairy management project, popularly known as
Kamdhenu, implemented in Chittoor district of Andhra Pradesh. Benefitting about 700 members from
200 Self-help groups, this Rs.318.63 crore project impacted lives of people in multiple ways including
enhanced milk productivity (by 1000 litres per animal per annum), income augmentation (by Rs.18000
per household), improved nutritional security through increased consumption of milk, clean energy
through biogas, increased organic manure supply, for crops among others.

Similarly, Milkfed in Himachal Pradesh is the main agency which is providing milk marketing facility to
milk producers through a network of dairy societies in the state. HP Milkfed has organised 822 Dairy
Cooperative Societies having total membership of 37,945. Out of these, 185 societies are women dairy
societies. Milkfed is running 21 milk chilling centres having total capacity of 81,500 litres per day and
has 8 milk processing units with installed capacity of 85,000 litres per day. In addition, Milkfed also
has one milk powder plant with capacity of 5 MT/ day. Cattle feed unit with installed capacity of 16
MT/day has been setup by the agency.
National Livestock Mission (NLM)

The National Livestock Mission (NLM) has been launched during Twelfth Five Year Plan with the main
objective of achieving sustainable development of the sector by providing greater flexibility to states
in formulating and implementing the schemes as per the local needs for benefit of the farmers. Earlier,
GoI had been implementing several schemes with subsidy component like:
 1. Dairy Entrepreneurship Development Scheme, launched in 2010-11 for encouraging private
investment in modern dairy farms for production of clean milk, and heifer rearing farms to
conserve good breeding stock
2. Poultry Venture Capital Fund, launched in 2011-12, for encouraging poultry farming activity
especially in non-traditional states, improving production of poultry products, providing
quality meat to consumers in hygienic conditions and improving hygienic sale of poultry meat
and products in urban areas
3. Integrated Development of Small Ruminants and Rabbits, launched in 2009, aimed at
unemployed youth especially women, poor and marginal farmers to encourage commercial
rearing of sheep, goats and rabbits.
4. Pig development Scheme, launched in 2010-11, for encouraging commercial pig rearing

The National Livestock Mission integrates all these programmes and has an important component to
promote availability of feed and fodder to substantially reduce the gap between availability and
demand. The other sub-missions focus on Livestock Development, Pig development in North East
Region, and Skill Development, Technology Transfer and Extension. The Mission also supports
initiatives relating to development of poultry, piggery, small ruminants and other minor livestock
species as per the agro- climatic conditions of different regions/ states. An amount of Rs. 2,800 crore
has been allocated for carrying out above activities under National Livestock Mission for the 12th Five
Year Plan.

Need for NDRI and NABARD to work together

Inter-institutional networking and partnering with rural people is of immense value to take the
benefits of policy and developmental programmes to people. In this context, I recall the words of the
Milkman of India, Dr.Kurien, "India's Place in the sun would come from the partnership between
wisdom of its rural people and skill of its professionals." NDRI has well demonstrated strengths in
research, education, training and extension. I am happy to note that NDRI has developed technologies
for the manufacture of a variety of indigenous dairy products, formulated foods and health foods. The
product range developed here is contemporary as it addresses the nutritional needs of diverse
categories of people including those having lifestyle diseases like diabetes. Fortified foods and
composite foods developed here combining goodness of dairy products and fruits would cater to the
premium market segment and will fetch good returns to the producers. It is heartening to note that
NDRI has developed ties with industry and most of its technologies can be commercialised. Given the
scale of demand for dairy products with growing population and incomes, the task ahead of us is to
enable more and more entrepreneurs to emerge on the scene. Many schemes are there to develop
livestock but are not able to reach the target population. Two reasons for this can be the design of
the scheme and the information spread. On both counts institutions like NDRI can guide the policy
makers and help reach the target population. Research and extension can help redesign and reach
out to the people. NABARD, being the nodal agency for most schemes, can be more effective in its
functioning if institutions like yours working in agriculture and rural development strengthen our
hands. Thus, NDRI and NABARD can together strive for sustainable and diverse livelihoods, better
technology development and adoption, and nutritional security of our people.

Wishing you all and your students very best, I conclude by thanking all of you once again for giving this
opportunity to connect with you all.