Revised National Programme for Dairy Development (NPDD)

The Cabinet, vide its decision dated 19.03.2025, allowed the Department of Animal Husbandry and Dairying (DAHD) to implement the Revised National Programme for Dairy Development (NPDD) as a Central Sector component of the "Development Programmes" scheme, with an additional outlay of ₹1,000 crore — taking the total outlay to ₹2,790 crore during the 15th Finance Commission cycle (2021-22 to 2025-26). The scheme's objectives are to:

• •Increase the coverage of the organised sector through the establishment of new Dairy Cooperatives, giving dairy farmers opportunities to market their produce.
• •Create and upgrade dairy processing facilities and marketing infrastructure, and enhance the capacity of producer-owned institutions.
• •Provide cold chain infrastructure at the grass-root level for quality milk procurement and processing.
• •Provide training and create awareness on Quality & Clean Milk Production.

Producer Institutions (PIs) — The Actual Beneficiaries

• •State Cooperative Dairy Federations
• •Regional/District Cooperative Milk Unions
• •Multi-State Dairy Cooperative Societies
• •Farmer Producer Organisations (FPOs)
• •Milk Producer Companies (MPCs)
• •National Dairy Development Board (NDDB) & its subsidiaries
• •Self Help Group (SHG) Cluster Federations, through the State Rural Livelihood Mission (SRLM)

Project Implementation Agency (By Category of PI)

Component A — Dairy Development

Implemented throughout the country (2021-22 to 2025-26, continuing till 2027-28), covering these activity heads:

• •Milk Procurement — organisation/revival of Dairy Cooperative Societies (DCS); equipment/furniture for DCS.
• •Milk Chilling — Bulk Milk Coolers (BMC): civil work (building, water, power supply) and equipment/accessories.
• •Milk Processing & Value Addition — exclusive to North Eastern Region (NER), Hilly Areas, and Union Territories (UTs): civil work and equipment.
• •Milk & Milk Product Testing Laboratories — at village/DCS/BMC level, District/Union level, and State level, plus HACCP/ISO quality-assurance systems.
• •Certification & Accreditation — ISO, HACCP, Quality Mark certification.
• •Training & Capacity Building — farmer induction, dairy personnel/milk tester training, quality management systems, DCS/BMC/chilling-centre staff training, and Management Committee/Board training.
• •Research & Development — projects via ICAR institutions including NDRI, Karnal, screened by a Technical Committee.
• •Establishment of Milk Producer Company — membership mobilisation, registration, procurement/chilling infrastructure, initial 3-year office/admin expenses, micro processing infrastructure.
• •Planning & Monitoring — capped at 2% of outlay; covers project proposal preparation, field inspections, review meetings, and documentation.

Component B — Dairying through Cooperatives (DTC), JICA-Assisted

Funded through a Japan International Cooperation Agency (JICA) ODA loan of ₹924.56 crore, Government of India grant of ₹475.54 crore, and Participating Institutions' share of ₹168.18 crore (total outlay ₹1,568.28 crore). Priority states are Bihar and Uttar Pradesh, expandable up to five states per the loan agreement (Madhya Pradesh, West Bengal, Andhra Pradesh, Rajasthan, Telangana, Uttarakhand, Punjab). Component B covers:

• •Strengthening milk procurement infrastructure
• •Milk processing & manufacturing facilities (milk/milk products and cattle feed)
• •Marketing infrastructure support
• •ICT infrastructure support
• •Productivity enhancement (nutritional interventions, fodder development, crop residue management)
• •Project monitoring & studies, training and capacity development

Component A (New Proposals)

Component B (JICA) — Funding Split

GoI receives the ODA loan from JICA at ~0.85% p.a. and on-lends to NDDB at ~1.5% p.a. (NDDB retains a 0.5–0.65% margin). Producer-owned organisations repay NDDB over a maximum of 10 years, including up to 2 years' moratorium on principal.

1. 1Situation Analysis: A pre-project baseline survey (by an independent agency), review of prior funding, and assessment of player roles/capabilities is undertaken before proposal drafting.
2. 2DPR preparation: The State Implementing Agency (SIA)/End Implementing Agency (EIA) prepares a Detailed Project Report using the prescribed factsheet and Annexures I–VII, covering 2–3 adjoining districts for technical feasibility, with an undertaking of no duplication of funding/activities.
3. 3SLTMC screening: The State Level Technical Management Committee (SLTMC), chaired by the State's Additional Chief Secretary/Principal Secretary, screens and recommends proposals to avoid duplication of activities/project area. (DCS proposals under White Revolution 2.0, and NDDB-implemented projects, are exempted from this SLTMC recommendation requirement.)
4. 4Submission to DAHD: The recommended proposal, with soft copy of the DPR, is submitted to DAHD for appraisal.
5. 5PCMC scrutiny: The Programme Coordination Management Cell (PCMC) examines the proposal in consultation with NDDB, ICAR, Department of Rural Development and the Integrated Finance Division, finalising a recommendation.
6. 6PSC sanction: The Project Sanctioning Committee (PSC), chaired by Secretary (AHD), sanctions the project after PCMC appraisal, meeting quarterly (or more often) to avoid delay.
7. 7Fund release: Funds flow from DAHD to the SIA (State Federation/Milk Union, SRLM, or NDDB depending on PI category), then to the EIA, utilised and tracked via the PFMS portal.
8. 8Reporting & UC submission: SIAs submit quarterly progress reports, audited Utilisation Certificates (countersigned by the State's Administrative Secretary/SLTMC Chairman), and expenditure statements to DAHD.
9. 9Physical verification & completion: On project completion, the State Government reviews achievements against targets and submits a Project Completion Report with a consolidated audited UC and expenditure statement.