U’khand’s Livestock Paradox:
By Purna Chandra Jena
Uttarakhand’s hills face a livestock issue confirmed by data, yet policy continues to under-prioritise it. The state’s livestock sector now contributes only 2.14% to the Gross State Domestic Product at current prices — a decrease from 2.62% in 2019-20 — even as milk production increased to 18.97 lakh tonnes and egg output reached 594 million in 2023-24. This contradiction should concern every planner in Dehradun: production rises, but its importance diminishes. Livestock still adds Rs 6,748 to the average Uttarakhandi’s annual income — 2.46% of the per-capita income — but its share in the state’s growth story is shrinking, not expanding, in a hill economy with few terrain-neutral livelihood options remaining.
The household arithmetic is sobering. The 20th Livestock Census counted 8.45 lakh households in Uttarakhand rearing cattle and buffalo, out of 44.27 lakh total livestock — a figure that had already fallen 7.67% since 2012, with indigenous cattle decreasing by 15.5% and sheep by 22.8%. In this context, the Chief Minister State Livestock Mission (CM-SLM) has, since 2023-24, established 4,510 bank-linked units with a 90% interest subvention. Although this is just about 0.5% of the state’s bovine-rearing households — a pilot scheme rather than a sector-wide programme — it has mobilised over Rs 100 crore of institutional credit for less than Rs 10 crore of fiscal expenditure, a leverage ratio that merits attention for its economic significance, apart from the benefits it has provided to the households it has reached.
And what it has achieved for those households is confirmed in greater detail by a survey of a 599-responder state-wide dataset examined. Marginal farmers with fewer than or equal to 2 milch animals make up 48.4% of respondents, and medium farmers (3 to 5 milch animals) make up a further 40.6%, meaning 89% of the scheme’s reach is precisely where a livelihood scheme should be. Awareness stands at 82.9%, and 93.8% say they would recommend the scheme to other farmers — a rare endorsement rate for a subsidised credit programme anywhere in India. The more telling figure is the income gradient: marginal beneficiaries report a mean monthly gain of Rs 6,750, medium farmers, Rs 10,257, and large farmers, Rs 21,326 — increasing almost proportionally with herd size rather than plateauing, which indicates who the scheme benefits most. Significantly, 77.6% still seek further improvements, and two in five desire larger unit sizes than the scheme currently allows — a beneficiary community satisfied enough to stay and ambitious enough to request more. Whatever else one might say about CM-SLM, it is not a scheme that beneficiaries regret joining.
It is, however, a scheme whose delivery system functions at two distinctly different speeds. Uttarakhand Gramin Bank and the district cooperative banks process CM-SLM applications within 3 to 15 days — a truly commendable turnaround for agricultural credit anywhere in India. Nationalised banks — SBI, PNB, Union Bank — take one to three months or more, and beneficiaries report being asked for land-pledge collateral and pre-purchase private animal insurance that scheme guidelines do not explicitly require. This is not a hill-versus-plains issue or a flaw in the subvention rate; it is a branch supervision problem, and it is the single most solvable obstacle in the entire scheme, because the benchmark for how quickly this can be achieved already exists within the state’s own banking network.
The second common complaint concerns the rigidity of the structure in meeting various needs. Farmers across geographically separate districts — from the Haridwar plains to the Uttarkashi hills — are independently requesting the same three things: flexibility to set up a one- or two-animal high-yield unit instead of a fixed minimum of five or ten animals; a repayment period of five years instead of three, to lessen the monthly EMI burden on limited dairy cash flows; and a move from a back-ended, hard-to-trace interest subvention to a transparent, front-loaded capital subsidy credited directly to the borrower’s account. The fact that these three requests keep recurring from beneficiaries with entirely different market access and terrain suggests to the Department that this is a design flaw, not a problem of local implementation. It should be addressed centrally once, rather than negotiated district by district.
Five reforms directly stem from this evidence, and the Department does not need a new study to justify any of them. First, shift from back-ended interest subvention to a front-ended capital subsidy — several central and state schemes already use this approach, and beneficiaries explicitly ask for it. Second, replace the detailed Khata-Khatauni land-title requirement with a simplified livestock-ownership verification system, especially in nationalised bank branches, where documentation is the most common obstacle across all surveyed districts. Third, launch an integrated digital tracker portal linking veterinary officers and bank branches, allowing beneficiaries to see their file status in real time—the most affordable solution and one that most beneficiaries request by name. Fourth, replace the mandatory private pre-purchase animal insurance with a state-subsidised, block-level insurance product, removing an upfront cost that scheme rules were never meant to impose. Fifth, allow more flexible, smaller unit sizes — one or two high-yield animals — alongside a five-year repayment period for marginal and hill beneficiaries, ensuring the scheme’s design aligns with the household’s financial realities.
None of this needs to be invented from scratch. Himachal Pradesh has become the first state in India to establish a minimum support price for cow and buffalo milk, procuring over two lakh litres daily from more than 38,400 farmers, alongside subsidised feed and mobile veterinary units — a model that Uttarakhand’s hill-dairy landscape could easily adopt. Kenya’s mobile-linked dairy cooperatives and Rwanda’s Girinka livestock-transfer programme provide further evidence that credit paired with market access, not credit alone, is what turns a subsidy into a lasting livelihood.
Uttarakhand does not need to reinvent CM-SLM. It should build upon what its beneficiaries have already shown works, fix what they have identified as broken, and do both before the scheme’s next budget cycle locks in this year’s design, preventing a further year of hill households on the margins.
(The author is Economic Advisor, Advisory Support Group, Chief Minister’s Office, Government of Uttarakhand. He also works as Consultant for CHIEF — Policy and Strategy Advisors, New Delhi; Views are personal. The author acknowledges the Uttarakhand Animal Husbandry Department for data support.)
