MODEL BANKEBLE PROJECT ON

INDIGINIOUS POULTRY FARMING

NATIONAL BANK FOR AGRICULTURE

AND RURAL DEVELOPMENT
 Model of improved Indigenous Poultry (Broiler) birds farming – 100
birds

1. Introduction

Poultry development is one of the fastest growing subsectors of Animal Husbandry.

From being a household activity, Poultry farming in India has transformed into a very
scientific and commercial operation. The interventions of the corporate sector along
with policy environment provided by the Government of India / State Governments
from time to time has led to this transformation.
The scale, technology, management and capital requirement for commercial poultry is
beyond the reach of small and marginal/ BPL farmers. At the same time there is a
niche market for Desi or indigenous birds reared in natural environment. Desi or
indigenous birds reared in the backyard are generally poor performers in egg and meat
production. With improved strain, these poultry birds, can give excellent result when
raised in backyard. The activity can be taken up by beneficiaries from BPL families,
SHGs, landless, small and marginal farmers for supplementary income and nutritional
support. To obtain maximum profit from indigenous poultry birds, these strains have
been improved and are giving excellent result when raised with low inputs. Some of
the improved varieties developed are Vanaraja, Giriraja, Girirani, Krishna - J etc.

2. Scope for Improved Indigenous poultry broiler farming

The activity provides supplementary employment opportunities and nutritional

security for the rural poor under Backyard poultry production system. In India,
backyard poultry, produces 30 to 35% of the eggs and is important for livelihood and
nutritional securities of the rural poor. There is a scope to promote clusters or small
holder’s poultry estates by backyard poultry farmers in rural areas. The lower costs of
input and the higher market prices offered for local poultry, backyard systems provides
better returns. Improvements in management practices by rural poor will reduce
disease and mortality incidences in rearing indigenous birds and would increase their
profitability and offer good scope for further development in the years to come.
 3. Government initiatives

Government of India is encouraging conservation of indigenous poultry breeds for

producing poultry birds suitable for backyard poultry. More focus is being given to
provide appropriate support to indigenous poultry farming in the form of financial
assistance, genetic stocks and improved technologies, scientific advice,
extension/awareness. Central Poultry Development Organisations (CPDOs) located at
four regions viz. Chandigarh, Bhubaneswar, Mumbai and Bengaluru are working on
improved breeds of birds for backyard poultry which can survive at the farmer’s
doorstep, provide training to backyard poultry farmers and conduct feed analysis.
Kalinga Brown, Kaveri, Chhabro and Chann are the varieties / strain of Low Input
Technology birds (Chicken) developed by these CPDOs. Based on demand they supply
hatching eggs, Day old chick of parent / commercials of these varieties to the States /
UT’s and individual farmers. Some state governments have also come forword to
promote improved desi poultry through backyard poultry low input technology birds.
Under National Livestock Mission (NLM), the chicks/ birds suitable for rearing in the
backyard are reared in the mother units upto 4 weeks and are further distributed to
the BPL beneficiaries in atleast two batches under, Rural Backyard Poultry
Development (RBPD).

4. Advantage of backyard poultry farming

i. A unit can be started with very small size with low initial capital investment
ii. Low feed cost due to use of Agricultural by-products, farm and kitchen waste
etc.
iii. Quality of chicken and egg is better as the birds are raised in stress less
environment with natural input.
iv. Egg and birds can be sold in local market with high price, because there is a
growing demand for local chicken.
v. Resistance to diseases, better adaptability to extreme climatic conditions, can
thrive on poor management and housing arrangements
vi. Source of supplementary income and better utilization of family laboures who
are not able to perform other agricultural works
vii. Due to low maintenance, acceptability among the landless labourers or
marginal farmers and women members of Self Help Groups is higher

5. Project formulation for bank loan

I. Technical
i. Housing management for backyard poultry farming

A small unit for rearing of improved indigenous birds for meat purpose can be
established as backyard unit by landless families, SHG members. Since
indigenous birds are more resistant to diseases and adverse climatic condition
as compared to hybrid birds, they can be reared in the shed made from low cost
housing material like wood, bamboo, grass, thatch etc. Area of 1sqft per bird is
sufficient. Overcrowding of birds should be avoided. The sheds should be
constructed on well raised land and non-water logging areas. The shed should
be well ventilated ands Floor should be in elevated land or above ground level
(minimum 2ft) and free from water crack, easily cleaned, rat proof.

ii. Management of birds

 Birds are generally reared on free

range system. The birds are let loose in
day time for foraging and sheltered in
shed at night.
 After purchase, brooding
arrangements are required to be provided to the day old chicks in first week.
Brooding can be done by using any heating source – electric bubs, bukhari. The
floor should be covered with 1-2 inches of paddy/ wheat straw to avoid injuries
to birds.
 Similarly, birds are to be protected from attack of predators.
  The shed should be cleaned regularly to prevent dampening and thereby fungal
and microbial infections.
 For better health care in backyard poultry farming the birds should be
vaccinated against diseases at proper time. Deworming for internal and
external parasites also should be done to maintain a healthy flock.

iii. Feeding management

The birds are to be fed with good quality concentrate feed to attain the desired
marketable weight. The feed can be prepared by the farmers by mixing the
available feed ingredients. The feed should be stored in clean, dry, well
ventilated room and care should be taken that fungal infection is not occurred.
The birds are to be fed a per schedule avoiding over and under feeding.
Generally these birds are having habits of scavenging for feeding. However, to
avoid feed losses it is desirable to provide feed in locally available feeder. Birds
are to be always provided with fresh and clean drinking water. Water should be
always available at birds and it should be ensure that birds do not enter the
waterers.

II. Financial

i. Financial assistance available from Banks for Indigenous Poultry

broiler farming

As indicated earlier, improved indigenous poultry farming activity is accepted by small

and marginal farmers, landless poor and women members of Self Help Groups as their
livelihood activity.It is being financed by banks under various schemes/ programmes.
Since the activity is generally taken up on small scale, investment/ capital cost
required is very less. A model economics for improved indigenous broiler farming with
a unit size of 100 birds in ‘All In All Out’ batches is given below. This is indicative and
the applicable input and output costs along with other parameters observed at the field
level may be incorporated.

ii. Lending terms - General

a. Outlay:
Outlay of the project depends on the local conditions, unit size and the investment
components included in the project. Prevailing market prices / cost may be considered
to arrive at the outlay.

b. Margin Money:
Margin depends on the category of the borrowers and may range from 10% to 25%.

c. Interest Rate:
Banks are free to decide the interest rates within overall RBI guidelines. However, for
working out financial viability and bankability of model project, the rate of interest is
assumed at 12.00% p.a.

d. Security:
Security will be as per RBI / NABARD guidelines issued from time to time.

e. Repayment of loan:
The loan repayment is determined, on the basis of gross surplus generated in the
project. Usually the repayment period of loan for broiler farming is 5 years without
moratorium.

f. Insurance:
The birds and other assets (poultry shed, equipment etc) may be insured. Wherever
necessary Risk/Mortality fund may be considered in lieu of poultry insurance.

A model project of 100 Improved Indigenous broiler birds on ‘All in All

Out’ batches is given in Annexure I. This is indicative and the applicable
input and output costs as also the parameters observed at the field level
may be incorporated.
 Annexure I

Economics of Improved Indigenous Poultry Broiler Farming

Model of improved Indigenous Poultry (Broiler) birds farming – 100

birds

A. Project Cost
Amt Rs
Construction of shed - 100 sqft 5000
Mud wall, Bamboo & Thatched roof
Cost of Equipments 1500

Capital Cost 6500

Cost of 1st batch of 100 Day Old Chicks 2500

Cost of feed 5000

Recurring cost 7500

Total Cost 14000

Margin (10%) 1400
Bank loan 12600

B. Techno economic parameters

Type of Birds - Improved Indigenous

No of birds per batch 100
The birds will be maintained on All in All Out batches under deep litter
system.
Mud House with tatched roof will be constructed using locally available
material to provide shed for the birds
Day old chicks will be reared for 55-60 days under deep litter system.

The birds will attain body weight of 1 kg on 60 days of their age. The
birds will then be marketed.
Mortality in birds (%) 8-10
Feed consumption (Kg per bird) 2.50
Cost of Day Old Chick (Rs.) 25
Cost of feed (Rs. per kg.) 25
Expenditure on Vaccine/ Medicine (Rs per bird) 15
Average live weight of birds (kg. per bird) 1
Sale price of birds ( Rs. per kg.) 150
Rate of interest on bank loan (%) 12

Years 1 2 3 4 5
No of batches purchased- 100 6 6 6 6 5
each
No of batches sold – 90 each 5 6 6 6 6
Economics
Amt
Rs
Particulars 1 2 3 4 5
Sale of Broilers 67500 81000 81000 81000 81000
Total Income 67500 81000 81000 81000 81000
Cost of chicks 15000 15000 15000 15000 12500
Cost of feeding 37500 37500 37500 37500 37500
Expenses on
med./vaccine 9000 9000 9000 9000 7500
Total Expenses 61500 61500 61500 61500 57500
Gross Surplus 6000 19500 19500 19500 23500

D. Calculation of BCR and IRR

1 2 3 4 5
Capital Costs 6500 0 0 0 0
Recurring Cost 61500 61500 61500 61500 57500
Total Costs 68000 61500 61500 61500 57500
Benefit 67500 81000 81000 81000 81000
Net Benefit -500 19500 19500 19500 23500
PW Costs @ 15% DF 209821
PW Benefits @ 15% DF 259785
NPW @15%DF 49964
B.C. Ratio 1.24:1
I.R.R. (%) >50%

C. Repayment Schedule

Yea Loan Gross Interes Principa Total Surplu

r Outstandin Surplu t l Repaymen s
g s t
1 12600 6000 1512 2000 3512 2488
2 10600 19500 1272 3000 4272 15228
3 7600 19500 912 3000 3912 15588
4 4600 19500 552 3000 3552 15948
5 1600 23500 192 1600 1792 21708
 DISCLAIMER
The views expressed in this model project are advisory in
nature.
NABARD assume no financial liability for anyone using this
project report for any purpose. The actual costs and returns
will have to be taken on a case by case basis considering the
specific requirements of projects.

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