Can Privatization Improve Animal Healthcare Delivery System? An Ex-ante Analysis of Dairy Farmers in Tarai Region of Uttarakhand§

Animal healthcare services (AHS) are crucial for the profitability and sustainability of smallholder dairy production systems. The deteriorating AHS under the control of public sector has oriented towards privatization of these services. Therefore, any study analyzing the potential impact of privatization in terms of willingness to pay for such services by the rural households and access to privatized services would constitute an important area of research inquiry. The present study has been carried out on 80 dairy farmers in five randomly selected villages of Udham Singh Nagar district of Uttarakhand. The study has revealed that in regard to quality attribute, there is not much difference between a government and a private veterinarian. Also, not much difference has been observed among farmers belonging to different wealth categories when it comes to their perception towards different attributes of AHS providers, viz. quality, affordability and proximity. Thus, the real issue regarding uptake of AHS, irrespective of the economic status of farmers, is the delivery of quality AHS, rather than the prices charged. Willingness to pay analysis has revealed that there is a significant scope for raising revenues from AHS delivered by the government by cost recovery approach or encouraging setting-up of private veterinary centres. However, the amount charged should be reasonable and not beyond the reach of poor. The characteristics like education, occupation and herd size have been found to significantly influence the willingness to pay. The study has concluded that privatization will certainly improve the animal health delivery system in the region and farmers are even willing to pay for these AHS, provided quality and efficiency of these services are maintained. Some policy suggestions have also been given in favour of privatization of AHS.