States extend farm equipment subsidy on labour scarcity, rising wages

First, it was sugarcane harvesters and now it is milking machines on which State Governments are offering subsidy to enable farmers to cope with labour shortages in the countryside.

The Gujarat Government has recently announced a subsidy of 50 per cent or Rs 20,000 (whichever is lower) on milking machine purchases by dairy farmers.

“It is a good scheme because some of our member unions are already giving a subsidy of Rs 10,000-13,000. If you add the Government's Rs 20,000, the farmer has to foot only a quarter of the Rs 40,000 cost for a machine that can milk 10 or more animals at a time,” said Mr R.S. Sodhi, Managing Director, Gujarat Cooperative Milk Marketing Federation (GCMMF).

Demonstration effect

The Gujarat Government is offering the subsidy on 2,500 machines initially, and plans to extend it to more units as the demand from farmers increases. “It makes sense to go by stages. We will first target one or two farmers from each village society and their experience could rub off on others,” Mr Sodhi added.

The Rs 9,774-crore GCMMF's 13 district unions procure about 95 lakh litres of milk daily from 30 lakh-odd farmers, who are part of over 15,000 village societies.

Dairying in India is largely a family-based enterprise. Much of the labour, whether for milking or for grazing, feeding and cleaning the animals, is contributed by family members, especially the womenfolk. But with family size getting smaller and increasing emphasis on education, the opportunity cost of having children tend to buffaloes (rather than sending them to school) has gone up.

“If milk has to be delivered to the society at six in the morning, it means getting up and start milking from four o'clock. It is unrealistic to sustain this in today's world, where even those who rise early would prefer investing that time in other activities, including readying their children for school,” noted Mr Sodhi.

Reducing drudgery

GCMMF claims to have partially solved this problem by installing bulk milk coolers (BMC) in many of its primary societies. Without BMCs, the milk collected from farmers has to be transported quickly to avoid spoilage at ambient temperatures.

The BMCs chill the milk ‘at source' and maintain it at 4-6 degrees Celsius to arrest any bacterial growth. That gives flexibility to farmers, as they do not have to rush to pour by 6 am, while the milk remains fresh for the tankers to take delivery later in the day. Moreover, there are savings on fuel costs. The tankers, instead of collecting milk once in the morning and again at 6:00 in the evening, have to only make a single trip to take care of the morning's as well as previous evening's procurement.

“Roughly 65 per cent of our total milk procurement is now through BMCs, which have individual capacities from 1,000 to 10,000 litres. In some unions such as Kaira and Banaskantha, the proportion is 80 per cent,” informed Mr Sodhi.

After BMCs, GCMMF's next major focus is on milking machines. “Today, even you get up at 4 am, you will be able to only milk 3-4 cows. With milking machines, you can do 10 and still have time for other things. This would, over a period, also lead to bigger herd sizes going up to 20 or so. Beyond that, you require hired hands as well more capital, which makes dairying unviable in our conditions,” he pointed out.

Subvention schemes

The Gujarat Government had, earlier, announced a Rs 50 lakh subsidy on sugarcane harvesters acquired by cooperative sugar mills. There were 18 such machines (each costing around Rs 1.1 crore) deployed during the 2010-11 crushing season.

The Maharashtra Government has come out with a similar scheme of providing a 50 per cent subsidy for harvesters bought by self-help groups of cane growers. The subsidy is 25 per cent for mills, as they can also avail concessional loans from the Centre's Sugar Development Fund for the same purpose. The Agriculture Ministry's Rashtriya Krishi Vikas Yojana also has a farm mechanisation assistance component.

All these interventions come at a time when farm labour costs have shot up, soaring by 40 per cent-plus in some States in the last one year alone.

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