Economics of Animal Rearing

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Context: With the recent vaccination drive of livestock for prevention of Foot and Mouth disease in Assam and the constitution of the 'gau cabinet' and introducing 'gaurakshak cess' shows the importance governments are placing on livestock due to its various benefits on Indians and on its economy. 

Relevance: GS III, Economics of animal-rearing.

What is Animal Rearing

As per the Ministry of Fisheries and Animal husbandry animal rearing is considered as an associate business within agricultural activities that are concerned with animals that are raised for meat, fiber, milk, eggs, or other products. Animal rearing is an integral component of Indian agriculture, supporting the livelihood of >55% of the rural population.

The objective of animal rearing is to make livestock, fisheries useful for human beings for a variety of purposes many of which have economic value. Hence economies of animal rearing have a vast potential for providing non-farm employment and income to rural areas.

Potential of animal rearing economy in India
  • India is the 2nd largest producer of fish and also the 2nd largest aquaculture nation and contributes around 1% of GDP in 2017-18.
  • India is the highest livestock owner with a population of 535.78 million as per the 20th livestock census,2019.
  • The second-largest poultry market in the world, the sector is valued at INR 1 lakh crore.
  • Second in the population of goats with a population of 148.8 million goats(20th livestock census,2019).
  • Third highest in the population of sheep and the fifth in the chicken and duck population(20th livestock census,2019).

Contribution of animal rearing to the Indian economy
  • Employment generation– It provides employment to around 8.8% of the Indian population.
  • Food security and diversification of food sources such as milk, eggs, meat, etc. Ex: Operation Flood has made India self-sufficient in the milk sector
  • Contribution to GDP – The livestock sector contributes 4.11% to Indian GDP and also 25.6% to agricultural GDP.
  • Towards Sustainable agricultural development – In Mixed farming systems by integrating animal rearing with traditional farming helps to increase productivity in a more sustainable and profitable way.
  • Biogas production – Dung and animal waste is an excellent substitute for fossil fuels or fuelwood which helps to reduce dependence on crude oil and reduce the fiscal deficit of India. Ex: In India alone, 300million tons of dung are used for fuel every year.
  • An important source of foreign earnings
    • In 2018 India stands 2nd in beef exports.
    • Production of wool, leather, etc which have high export potential.

Benefits of animal rearing to Farmers:

  • Alternative Income to farmers: Animals serve as moving bank and assets which provide economic security to farmers and helps them to earn quick money during emergencies. Livestock live cow, sheep helps farmers to get subsidiary income by selling milk and other animal products.
  • Food and Nutrition: Bovine animals and poultry ensure a constant supply of milk and eggs which helps to get the required nutrition to farmers and their families.
  • Social Security: Animals offers a sense of social security in rural areas, especially landless farmers who own more livestock are better placed than others.
  • Draft power of animals: Bullocks are the backbone of Indian agriculture. Despite a lot of technological advancements, Indian farmers are still dependent on bullocks for various agricultural operations.
  • Animal waste such as dung can be used as a fertilizer and reducing the dependence on market-based fertilizers. It also helps farmers to move towards Zero Budget Natural Farming.
  • Resilience to climate change: As livestock is less prone to global warming and climate change, it can be considered more reliable than rain-fed agriculture.

Animal Rearing and Inclusive Growth:

  • Provides Self-employment to millions of people especially in rural areas and can also contain forced migration.
  • Risk mitigation by providing a sense of security and confidence to landless, small, and marginal farmers.
  • The distribution of livestock is more equitable than that of land. Ex: Government of India providing cows to Rwanda part of Girnika program.
  • Animal husbandry promotes gender equality by empowering women economically and socially.
  • It is observed that the incidence of rural poverty is less in states like Punjab and Haryana where livestock accounts for a sizeable share of agri-income.
  • Combats Malnutrition and hidden hunger in the children, providing opportunities for all in economic development.
Challenges/Issues involved
  • Outbreak of Diseases: Frequent outbreaks of Foot and Mouth disease, Black Quarter infection, Brucellosis, etc, which affect livestock and productivity.
  • Yield and productivity issues: Although India is the largest producer of milk, the yield of Indian cattle is only about 50% of the global average.
  • Contributor to Greenhouse gases: Across the world, the livestock sector contributes to 14.5% of human-induced greenhouse gas emissions, whereas in India livestock sector contributes to 58% of agricultural emissions(as per 2012 estimates).
  • Lack of technology advancements: Limited artificial inseminations, deficiency in quality germplasm, lack of technical manpower.
  • Funding issues: The livestock sector received only 12% of total expenditure on agriculture and allied sector. Which is very less as per its size and contribution to GDP.
  • Poor insurance coverage: Only 6% of animal heads are provided with insurance coverage.
  • Market access: markets for livestock and its products are underdeveloped and are not formalized acting as a disincentive to farmers to adopt livestock.
  • Presence of informal sector: About half of the meat production comes from the unregistered slaughterhouses which are leading to poor price realization to farmers.
  • Lack of quality checking and standardization of animal products leading to poor quality exports and returning of exports by other countries under sanitary and phytosanitary.
Measures and Suggestions
  • Ensuring feed and fodder security by enhanced fodder seed production; using high yield fodder varieties; development of fodder banks; and improvement of wastelands, other community lands for fodder.
  • Niti Aayog @75 recommendations:
    • Breeding indigenous cattle with exotic breeds to enhance productivity.
    • Promoting and developing Bull mother farms with an objective to produce good quality genetically superior bulls and also to promote cross-breeding.
    • Establishing village-level procurement systems for better supply chain management.
    • Capacity building for farmers and fish breeders with new technology penetration.
  • Institutional strengthening to provide better credit and insurance coverage to the livestock farmers.
  • Boosting infrastructure by establishing cold chains and storage facilities as livestock products are perishable in nature.
  • Public spending needs to be increased to re-energize the livestock sector.
  • Veterinary services should be strengthened and ensure vaccination of animals to prevent the occurrence of diseases in livestock.
  • Promoting research and development to enhance the productivity of animals.
  • India should strictly follow the sanitary and phytosanitary standards as laid down by Codex Alimentarius Commission which is formed by FAO and WHO.
Steps Taken by Government:

  • Establishment of Dairy Processing and Infrastructural Development Fund to enable the milk processing capacity in the country.
  • Animal Husbandry Infrastructure Development Fund (AHIDF) is proposed with 15,000crores to leverage private investment and ensure availability of capital to the farmers and also to provide direct or indirect livelihood creation. 
  • National Animal Disease Control Programme (NADCP): The program aims to control the livestock diseases the foot and mouth disease and brucellosis in livestock by 2025 and eradicate these by 2030.
  • Budget 2020-21 proposed to establish
    • KISAN RAIL and KISAN UDAN to provide connectivity 
    • Artificial insemination to be increased to 70% from the current 30%.
    • MGNREGA to include the development of fodder farms.
  • Schemes like Rashtriya Gokul's mission for the improvement of indigenous breeds and to sustain the extreme climatic conditions.
  • E Pashu Haat Portal to connect the breeders and farmers regarding the quality bovine germplasm.

 

Important revolutions related to agriculture and allied sector
Revolution Related to
White Revolution Milk and Dairy Sector
Green Revolution Agriculture and to ensure food security
Yellow Revolution Oil Seed production
Blue Revolution Fisheries development
Brown Revolution Leather/Cocoa production
Grey Revolution Fertilizer development
Golden Revolution Horticulture and Honey production
Golden Fibre Revolution Jute production
Pink Revolution Onion/Prawns/Pharmaceutical
Red Revolution Meat and Tomato
Silver Revolution Egg/Poultry/Cotton

 

Components of Animal Rearing 

Fisheries- Blue Revolution:

  1. Potential:
    • India is the 2nd largest producer of fish.
    • Employs around 16 million fish farmers and even more at a higher value chain.
    • Contribution to GDP around 1% of GDP in 2017-18.
  2. In order to realize the full potential government has launched the Blue revolution with a clear-cut objective:
    • Modernize the fisheries sector with new technologies.
    • Generate employment and promotion of exports.
    • Promotion of Inclusive growth by empowering farmers.
    • Increasing food production in a sustainable manner.
  3. Challenges faced by the fisheries sector:
    • Shortage of quality and healthy fish seeds.
    • Lack of mapping of zones of fishes and poor fishing vehicles.
    • Absence of standardization and branding of fishes.
    • Inadequate extension staff and lack of training to fishers and nonavailability of skilled man force.
    • Usage of obsolete technology, depletion of inland natural waters are challenges in inland fisheries cultivation.
    • Usage of unsustainable practices like blast fishing.
    • Lack of strong value chain which makes India poor performing state in exports even though we are 2nd largest producer.
  4. Measures to boost the Blue revolution:
    • Promoting community participation in fishermen by establishing FPO's in the fisheries sector.
    • Development of post-harvest infrastructure by developing cold storage infrastructure, processing plants, etc.
    • Restoration of natural productivity and conservation of indigenous fishery resources.
    • Promotion of integrated farming system- rice cum fish agriculture on the lines of Kuttunad below sea level farming.
    • Upgradation of fishing vessels and using satellite technology of Gagan and Gemini to map fishes rich zones.
  5. Government Schemes:
    • Integrated development and management of the fisheries sector for focussed development and management of the fisheries sector.
    • Pradhan Mantri Matsya Sampada Yojana adopts a cluster-based to strengthen backward and forward linkages.

Dairy Sector- White Revolution:

  1. Potential & Advantages:
    • India also has the largest bovine population in the world.
    • In India, milk production is growing by 6.4% during the last 5 years and has increased from 146.3 million tonnes(mt) in 2014-15 to 187.7 mt in 2018-19.
    • As per the National Sample Survey Office’s (NSSO) 70th round survey, 23% of agricultural households with very small parcels of land (less than 0.01 hectare) reported livestock as their principal source of income.
    • Egalitarian and inclusive, as most of the livestock is concentrated in dryland areas and with small and marginal farmers, the development of animal husbandry is considered to be more.
  2. Understanding the potential of the dairy sector government has launched Operation Flood with the following objectives:
    • To promote cooperative societies to enhance procurement, storage, transportation of milk.
    • Production of a wide variety of milk products and their marketing management.
    • Provide superior breeds of cattle, health services, veterinary treatment, and artificial insemination facilities.
    • The achievements of operation flood/white revolution.
      • Alternative occupation to rural masses.
      • Became leading producer in milk
      • Quality of livestock and promotion of indigenous livestock.
      • Small and Marginal farmers along with landless laborers are benefitted.
  3. Challenges in the Dairy Sector:
    • Inadequate market facilities and informal sector, as per economic survey 2018-19 about 36% of the milk sold is handled by the organized sector and the rest by the unorganized sector.
    • In most places, cattle are kept under unhygienic conditions.
    • Incidence of diseases such as Foot and Mouth diseases.
    • Climate change led to an increase in temperature affecting productivity.
    • Poor coverage of livestock insurance.
    • Infrastructural deficiencies such as cold chain facilities leading to milk losses.
  4. Measures towards New white revolution/Operation Flood 2.0:
    • Geotagging of animals helps us to keep track of health-related issues of a particular animal.
    • Strengthening the Dairy Development Extension Program and creating a network of strong value chains.
    • Using technology like Artificial Intelligence and Machine learning to run simulations on how to increase the productivity of the animals.
    • Following the Niti Aayog's recommendations as cited above.
  5. Government Initiatives:
    • National Livestock Mission focuses on the development of livestock and adequate availability of quality feed and fodder.
    • Gobar-Dhan(Galvanizing Organic Bio-Agro Resource Dhan) will manage and convert cattle dung and solid waste in farms to compost, biogas, and bio-CNG.
    • Rashtriya Gokul Mission to develop indigenous breeds in a scientific manner.
    • Dairy Entrepreneurship Development Scheme under NABARD for generating self-employment opportunities in the dairy sector, covering activities such as enhancement of milk production.
    • Doubling of milk processing capacity to 108 million MT from the present 53.5 million MT by 2025(budget 2020-21). 
Conclusion

In a country like India where greater than 50% of the population is involved with agriculture and agri-based activities, it is the need that the farmers diversify their risks by managing parallelly the livestock which helps not only in generating extra money but also to ensure nutritional security in the families of farmers. Hence government investing in the livestock sector will ensure to bring inclusive development and also enhances the export potential and ultimately fulfilling the dream of doubling the farmer's income by 2022.



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