Vol. 12, Special Issue 8 (2023)

Author(s):
Revappa M Rebasiddanavar, SS Guledagudda, GN Kulkarni, AS Patil and BG Shivakumar

Abstract:
The present study attempts to analyze financial feasibility of investment in large scale dairy enterprises in Karnataka. The Indian economy is an agrarian-economy. Agriculture is considered as an important pillar of the Indian economy which support livelihood to large proportion of rural population in the country. The total share of agriculture to the economy is 18.8 percent in 2022-23. The livestock industry is playing an essential role in the socio-economic development of millions of rural households. Livestock keeping an integral component of agriculture in India and make multifaceted contributions to the growth and development of the agricultural sector. The results reveals that overall total cost per dairy unit was ₹ 7,95,620 and ₹ 8,35,410 per year in Belagavi and Bellary districts in North Karnataka respectively while ₹ 8,63,080 and ₹ 8,64,274 for Mysore and Tumkur in South Karnataka respectively. The gross returns from large scale dairy enterprises per year analyzed for Belagavi and Bellary districts of North Karnataka are ₹ 10,49,300 and ₹ 10,30,500 for respectively. While, gross returns realized from large scale dairy enterprise from milk per year analyzed for Mysuru and Tumkur districts of South Karnataka are ₹ 10,28,315 and ₹ 10,35,900 respectively. The overall results revealed that the returns from milk constitutes a major share of gross returns per dairy unit in both North (72.91% and 71.32%, respectively) and South (72.15% and 70.91%, respectively) Karnataka. Returns realized from manure and the sale of animals constituted a considerable share of gross returns per dairy unit in both North (23.28% and 24.84%, respectively) and South (23.48% and 24.43%, respectively) Karnataka. The results of financial feasibility analysis could be observed that Net Present Worth (Rs. 63,237.75), Benefit Cost Ratio (1.23), Internal Rate of Return (42.75%) and Payback Period (4.34years). It can be concluded that an investment in large scale dairy enterprise is a financially feasible and economically viable in both North and South Karnataka.