16.07 crores in treasury wasted by Kerala Chicken; loss mentioned in CAG report

THIRUVANANTHAPURAM: The Kerala Chicken project, which was launched to provide good quality broiler chicken to consumers at a low price and ensure self-entrepreneurship to unemployed women, caused a loss of 16.07 crores to the government treasury. The failure of the Kudumbashree community project was pointed out in the preliminary report submitted by the Comptroller and Auditor General to the state government. The Kudumbashree Broiler Farmers Producer Company Limited (KBFPCL) formed for this purpose is also sinking into losses since the objectives set by the project could not be achieved.

The project was implemented in Thiruvananthapuram, Palakkad, and Kozhikode districts. 6 crores in 2019 and 10.07 crore in 2020 were allotted for setting up breeder farms and meat processing plants in all three districts. However, neither Kudumbashree nor KBFPCL has found land suitable for construction work anywhere so far. KEPCO reported that the land found for the breeder farm in Thiruvananthapuram was not suitable. The second-year allotment of 10.07 crores should have been avoided by the government when no land was available in the first year itself. This amount has been allocated from the Rebuild Kerala Initiative, a World Bank aid for New Kerala construction.

It was planned to set up a meat processing plant on 4.5 acres at Kadinamkulam in Thiruvananthapuram, but the construction was stalled due to the outbreak of the Covid pandemic.

KBFPCL is a purely private enterprise formed by a consortium of Kudumbashree Community Development Societies. The CAG pointed out that the appointment of the Kudumbashree Executive Director as its Chairman and Project Officer of the Animal Welfare Department as its Chief Executive Officer was illegal. The company started operations on May 17, 2019.

KBFPC?

It is a company formed under section 2(68) of the Companies Act by a consortium of 10 CDS members each in three districts from whom shares were raised. The total share capital was 10 lakhs. The objective is commercial broiler production, meat processing, and marketing.

6 crores as initial finance

2 crores each for 3 districts

Out of this 1.50 crore for breeder farm and 50 lacks for meat processing uni

(The second sanctioned transaction of 10.07 crores is not specified in the CAG report).

Flaws

• The company was formed without carrying out a feasibility study.
• Started operations without a market entry strategy.
• Dependence on the external market to meet basic needs.
• Breeder farms, hatcheries, feed distribution units, etc. have not started yet.

Loss of ₹28.88 per chicken

Poultry units increased from 36 in 2019 to 260 in 2021, but the loss of the company increased from Rs 2.24 crore in 2019 to Rs 9.24 crore in 2021. When the Department of Animal Husbandry commissioned KEPCO and KSIDC for a technical feasibility study, it was found that the company was losing ₹28.88 per chicken due to high production costs.