Rural empowerment lessons that India can learn from Amul founder Verghese Kurien

Updated: Sep 27, 2019 5:12 PM

The Billion Litre Idea which led to the White Revolution and the establishment of Amul was instrumental in putting India’s dairy industry on the world map and ensuring livelihoods for over 100 million dairy farmers.

Milk supply, maharashtra Milk supply, flood situation, Maharashtra floods, Cooperative Milk Producers UnionIndia is now the world’s largest producer of milk having overtaken the US two decades ago.
  • By- Professor Hitesh Bhatt

Once a net importer of milk, India is now the world’s largest producer of milk having overtaken the US two decades ago. The Billion Litre Idea which led to the White Revolution and the establishment of Amul was instrumental in putting India’s dairy industry on the world map and ensuring livelihoods for over 100 million dairy farmers. Of these millions, 70% are women and 69% belong to socio-economically deprived sections of the communities. For Dr Verghese Kurien, as the architect of this idea, certain factors were instrumental in creating such a significant impact for the underserved in the economy.

Harness the power of people

Of India’s 100-million-plus dairy farmers, more than 70 million hold 2-3 milch animals per head. The cooperative movement brought the farmers together and allowed them to organize themselves at scale. The Anand pattern of cooperatives strongly emphasizes on creating people-owned institutions at the grassroots level as a means to generate employment with an enterprise approach.

Empower rural India with business acumen

Dr Kurien believed the underserved communities can reach their potential much more easily if provided with professional management to run their enterprises. The milk cooperatives benefitted immensely from the management expertise initially provided by Dr Kurien. Subsequent investments in technology, marketing and production were made possible because professional managers were brought in to lead these areas. Whether it
was the latest milk cooling and storage machinery, creating the Amul girl as an iconic marketing tool or starting a helpline for taking care of dairy animals, professional managers across domains have been the game-changers. They have provided much-needed business skills to successfully manage the unorganized sector.

Create viable rural institutions and brands

Dr Kurien’s philosophy was that a business enterprise must be run as a business enterprise, aimed at staying profitable. Even for Amul, the goal was to maximize the return to the farmer. Amul’s shareholders are 3.6 million dairy farmers and hence the benefits directly accrue to them. In addition, creating rural institutions and connecting them directly to viable consumer markets, while eliminating intermediaries has benefitted both consumers
and producers in equal measure. The inception of Amul has not only created an enduring national brand but it has also transformed the dairy industry of India and given back manifold to the underserved communities in terms of socio-economic impact.

Data indicates the underserved constitute 74% of India’s population. While 70% of India’s population resides in rural areas; defined by its inaccessibility, rampant poverty and predominantly agrarian livelihoods; another 4% constitutes that of urban poor. India is in serious need of professionally-skilled business managers to serve the underserved segments of its economy. Mainstream B-Schools cater primarily to the 26% of India’s population that live in urban areas but India needs business managers who are not only skilled in the business domain but also have a sound understanding of the rural and underserved sectors. Institute of Rural Management Anand (IRMA) was set up by Dr Kurien to cater to this specific requirement. In the 40 years since its inception, IRMA has created over 3000 change-makers and its alumni have helped create some of the most enduring brands, institutions and initiatives in the underserved sectors in India including Amul, ITC e-Chaupal, National Rural Livelihoods Mission (NRLM), State Rural Livelihood Missions (SRLM) and Kshetriya Gramin Financial Services (KGFS).

Creating professionally managed rural institutions, that are able to harness the power of people at the grassroots level and empower them with business acumen, can be instrumental in powering rural livelihoods and the economy.

  • Professor Hitesh Bhatt is Director, Institute of Rural Management Anand (IRMA).

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