Banks yesterday launched low-cost loans for dairy farmers, aiming to boost local dairy production and help cut the country's dependence on imported milk. Dairy farm loan Bangladesh #DairyFarmLoan


Prime Minister Sheikh Hasina inaugurated the initiative by handing over cheques from 13 banks and financial institutions to 13 farmers during an event at the Krishibid Institution in Dhaka. Dairy farm loan system

Banks will lend to dairy farmers at an interest rate of 5 percent by borrowing from Bangladesh Bank's Tk 200 crore refinancing fund. The central bank formed the fund in June last year, to encourage dairy farming and cut malnutrition and milk powder import bills.

“The government has already ensured food security for all by boosting food production, and the aim now is to ensure proper nutrition by eliminating malnutrition and we have been working on that,” said Hasina, as quoted by BSS, at the event organised by the fisheries and livestock ministry.

Hasina underscored the need for processing and preserving milk to boost the milk-processing industry and help diversify into milk products like butter, ghee and cheese.

“These items have a huge local market and we can also export those abroad,” the UNB quoted Hasina as saying.

Bangladesh produced 696.85 crore litres of milk in fiscal 2014-15, up 14.3 percent year on year, according to the livestock services department.

The production was almost half the country's annual milk requirement.

"We spend nearly Tk 4,000 crore a year to import powder milk to meet the deficit," said BB Governor Atiur Rahman.

The refinance facility will allow at least 10,000 farmers to get cheap loans, he added.

Under the scheme, farmers will get loans between Tk 50,000 and Tk 2 lakh from banks, which they will have to repay within four and half years. Bank Loan calculator

Farmers can borrow Tk 50,000 for one heifer capable of reproducing within a maximum of three months, and take a maximum of Tk 2 lakh for four heifers for milk production. Applications for buying the indigenous species will get priority.

The BB says women and marginal farmers will be prioritised in extending loans, and the upazila office of the livestock services department will oversee the process to ensure proper use of the money on the borrowers' part.

"Production of milk and beef will rise with a proper use of the loan. The privilege will create self employment and encourage establishment of a modern dairy industry," said Rahman.

The low cost loan scheme for dairy farming will also have a positive impact on the rural economy, he said.