Milk marketing is not a challenge, processing is: T Nanda Kumar

Written by Sandip Das | New Delhi | Updated: Jul 28 2014, 07:23am hrs
T Nanda Kumar, former Union food and agriculture secretary, has taken over the chairmanship of National Dairy Development Board (NDDB) from Amrita Patel, who held the post for 15 years. NDDB was set up in 1965 through an Act of Parliament for replicating the success of Amul in other parts of the country. Kumar spoke to Sandip Das on the issues faced by the dairy sector and the cooperatives in sustaining the countrys milk production.

What are the challenges faced by the dairy sector at present What are the current trends and future prospects of the countrys milk production

In 2012-13, we produced about 132 million tonnes of milk. Last fiscal, we had an output of 138 million tonnes. The output is expected to grow at this rate, which implies adding 6 million tonnes of extra milk production annually. The reason is that the demand for dairy products would continue to increase in next 5-6 years. We need to continuously increase milk production and it has to be sustainable. Processed dairy products will have bigger growth than processed milk as a liquid after about 5-6 years. I do not see the possibility of import of milk in the near future.

Sustaining the milk production growth in the country is a must. How do you plan to meet this challenge

One of the key focus areas of our work is improvement in the genetic potential of animals. We intend to do it by a combination of factorsfocusing on high genetic merit indigenous cattle, production of high genetic merit bulls, improving artificial insemination, etc. The major portion of our intervention will be on good indigenous breeds; also the need to get exotic breeds from outside, from certain specific areas. We will import high genetic merit bulls to an extent and see that the breed improves. This will be done by a clearly defined breeding policy of state governments.

What about improving the feed quality of the animals for augmenting milk production

Traditionally, farmers feed animals agricultural waste and that is the way the sustainable economics work. We have found there are some ingredients that have to be supplemented in the cattle feed, which lead to increase in milk yield. We have initiated an IT-based Information Network for Animal Productivity and Health (INAPH), developed in collaboration with Infosys. It covers areas such as productivity enhancement including animal registration and identification, artificial insemination, milk yield recording and rational balancing of diet.

We have local resource persons and a chunk of them are women. They measure milk yield, capture breed characteristics and the feed that is being given. We have been able to achieve two objectives through INAPH. One is the reduction in the cost of feed. Farmers are feeding cows more essential elements than needed and what is a crucial feed ingredient is missing. Through balancing of feed, on one side we have reduced expenditure on the feed and on the other hand we have increased income for the farmers by increasing milk yield. The challenge is that each animal has to be tagged. We have already covered 2.7 million animals. We have given notebooks to local resource persons for capturing data. We will cover 40,000 villages through INAPH shortly. The programme is being implemented through cooperative milk federations and unions funded under the National Dairy Plan. We have covered 14 states and we have started with 200 villages in each milk union. We are considering involving state governments in expanding the programme.

Organised marketing is an important requirement. How do you plan to handle this aspect

We are promoting farmer producer organisations (FPOs), as cooperatives become a rigid structure. The key is to ascertain that at least 75% of the consumers rupee goes back to farmers. So far, good cooperatives have ensured that and some of the efficiently-run cooperatives have given even 80% of the consumers rupee to the farmers. This a critical point in milk management. The other issue is involving services into the fold of milk cooperatives such as animal health services and rational feed intakes. Some of these aspects have to be added to the role of cooperatives and FPOs, which is currently missing.

Animal health has emerged as a key area of concern

The overriding thrust is on animal health, which is with states governments, on which we are keeping a close watch. Outbreak of Foot and Mouth Disease, as happened last year in south India, can be a dampener. Delivery of vaccination has to take place on time and we need to educate farmers about lower milk yield during the vaccination period. Farmers have to understand these in the larger interest of the health of the animals.

How do you assess the performance of state cooperatives and milk unions in ensuring production and distribution of milk

Karnataka, Gujarat and Rajasthan have done well. Bihar and Kerala have shown improvement in recent years. Odisha is showing signs of recovery. We see a lot of potential as alignment with Eastern Indian Green Revolution initiatives would be imperative. Eastern regions have more water, thus more paddy cultivation. So, the logical thing in this region is animal husbandry. We see a lot of potential in Odisha, Bihar and West Bengal for the next big growth in dairy.

How to improve large cooperatives in bigger states such as UP

The UP cooperative movement has not done well. What we understand is that payments to farmers are not done on time. That can be biggest disadvantage for any cooperative. Ultimately, a cooperative would succeed if payments are transparent and on time. The moment we lose that connect, we are inviting trouble.

NDDB has been promoting farmer companies where dairy cooperative movement have been weak

We are promoting FPOs. Two of them are operational in Gujarat and Rajasthan. Three more companies in Punjab, MP and UP are in the various stages of formation. We are hoping to create such entities in other states also. The focus is to create such farmer companies where cooperatives have not taken off or are in a stage of decay. These entities would be covered under the Companies Law. They may not give brands like Amul much competition as they are not big enough. But, in their own areas of operation, if they are efficient in terms of processing and are transparent in financial management, they can deliver results to the farmers.

Cooperatives have to reorient themselves to modern day marketing of milk products. What is your view on this

Cooperative movements have to be more accountable to shareholders. They have to bring back the values of democracy. Inefficient management leads to decay. The bottom line is timely payment to farmers. Milk marketing is not a challenge, but processing is. Cooperatives or FPOs should ensure that enough liquid milk is sold to consumers. Farmer-centric organisations should be given a primary space in the market.

We had Operation Flood that led to India emerging as the worlds biggest milk producer, but this success could not be replicated in fruits and vegetables. What could be the reasons

We did not have a milk-like movement in fruits and vegetables. Besides, milk is more a homogeneous product to manage, as one can mix buffalo or cow or various types of milk. Vegetables are multiple products and processing is complex. It is a little more complicated but we should do it. We need a different structure as, unlike milk, a state cant produce all types of fruits and vegetables. We need to source and distribute correctly. Given the right structure, we can do it.