Business Times

Mega Rs 2.5 bln dairy project backed by “Tharunyata hetak”

By Bandula Sirimanna

An ambitious project to set up a chain of modern mini-dairy farms across 10 districts in Sri Lanka is to be launched by Lanka Fresh Milk (Pvt) Ltd with an initial capital of Rs.40 million, a Rs 2.5 billion loan facility and the backing of Namal Rajapaksa’s “Tharunyata Hetak” youth organisation.

Some 5,000 unemployed youth in these districts will be given self-employment opportunities under this project, and provided with necessary infrastructure facilities to run these farms which are aimed at increasing local liquid milk production, Chairman ad Managing Director of the Company Munnawar Ahamed told Business Times.

He is currently in the Juki Sewing machine business but said he wants to make use of 10 years of dairy farming experience while serving as a farm manager at Al-Safi Dairy Company in Saudi Arabia which has the largest single integrated dairy farm in the world covering 3500 hectares of land.
Mr Munnawar said his company will establish milk production centres at these farms run by young farmers at a total cost of Rs.40 million (Rs.4 million for each farm). The company will package the milk and sell it to the public in the same area.

Five hundred youths will be recruited in each district to work and manage the dairy farm in their respective area. Each youth will be provided a loan of Rs. 500,000 over five years, with the money coming from the government’s Rs.5 billion Agro Livestock Development loan scheme, he said. The company will act as guarantor for the loan and these youth will repay the loan from their earnings/profits.

***A senior official of the Central Bank said that the loans for dairy farming range from Rs.50,000 to Rs. 400,000 at an interest rate of 12 % per annum. The maximum repayment period is five years.
The plan by the company is to reduce Sri Lanka’s dependence on imported milk powder which costs Rs. 20 billion annually. At present only 6% of the country's milk needs is produced locally.

Mr Munnawar said the company wants to produce least 50 % of the country's dairy requirement locally within the next four years. He noted that the company will also establish a diary processing plant to process the milk into pasteurized and homogenized fresh milk and yoghurt.

Mr Munnawar said the firm through the establishment of these dairy farmer centres and with the help of animal husbandry experts will educate dairy farmers on ways and means of collection and sale of fresh milk in a systematic and hygienic manner.

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