India has multiple government-backed dairy loan schemes — pick the right one for your unit size.
These items form the project cost statement in your bank project report.
| Item | Typical Cost |
|---|---|
| Purchase of Milch Animals (5 nos) | ₹3,00,000–₹6,00,000 |
| Shed Construction / Renovation | ₹50,000–₹1,50,000 |
| Milking Machine | ₹20,000–₹60,000 |
| Chaff Cutter (fodder cutter) | ₹15,000–₹30,000 |
| Milk Cans & Storage Equipment | ₹10,000–₹25,000 |
| Water Supply / Bore Well | ₹20,000–₹50,000 |
| Initial Feed & Fodder Stock | ₹30,000–₹60,000 |
| Veterinary & Insurance (first year) | ₹10,000–₹20,000 |
| Total (5-animal unit) | ₹4.5L – ₹10L |
Yes. Dairy farming is one of the most supported agricultural businesses in India. Key loan options: (1) NABARD-linked Dairy Entrepreneurship Development Scheme (DEDS) — 25% subsidy (SC/ST 33%) for up to ₹7 lakh for 10-animal unit, (2) MUDRA Kishor/Tarun — ₹50,000 to ₹10 lakh for buying milch animals, (3) KCC (Kisan Credit Card) — for ongoing feed and veterinary expenses, (4) PMEGP — for dairy processing units up to ₹25 lakh.
NABARD's Dairy Entrepreneurship Development Scheme (DEDS) provides: 25% capital subsidy for general category (33% for SC/ST/women) for small dairy units of 2 to 10 animals. The maximum subsidy is ₹1.25 lakh for a 2-animal unit up to ₹7 lakh for a 10-animal unit. The loan is routed through NABARD-affiliated banks and NBFCs. A detailed project report covering animal cost, shed construction, feeding, and milk collection is required.
A small dairy unit of 5 cows/buffaloes typically costs: High-yield HF/Jersey cows ₹50,000–₹80,000 each (total ₹2.5–₹4 lakh), Murrah buffaloes ₹80,000–₹1.2 lakh each (total ₹4–₹6 lakh), Shed construction ₹50,000–₹1.5 lakh, Milking equipment ₹20,000–₹50,000, Feed/fodder for 3 months ₹30,000–₹50,000. Total for a 5-animal unit: ₹4–₹9 lakh depending on animal breed.
Required documents: Aadhaar card, PAN card, land documents or lease agreement for shed, quotations for animals from government-registered farms (for NABARD subsidy), bank account statement (6 months), project report with financial projections, Udyam registration (for PMEGP), and photographs of the proposed site. Some banks also ask for a veterinary certificate for the animals being purchased.
For project report purposes: HF (Holstein Friesian) cows: 15–25 litres/day, Jersey cows: 10–20 litres/day, Sahiwal/Gir (desi): 8–15 litres/day, Murrah buffaloes: 10–18 litres/day. Milk selling price: ₹35–₹55/litre depending on your state and buyer (dairy co-operative, private dairy, or direct sale). Your revenue projection should be based on conservative figures — typically 70% of peak production to account for dry periods.
Both are eligible for the same schemes. Cow dairy (HF/Jersey) has higher milk volume but lower fat content (3.5%). Buffalo dairy (Murrah) has lower volume but higher fat (7–8%) and higher price per litre. For bank loan purposes, buffalo dairy often shows better per-litre revenue. However, buffalo cost more to purchase. Many project reports show a mixed herd of 3 buffaloes + 2 cows for balanced projections.