Business Today

No water, so they make milk

Print Edition: Jan 6, 2013

Kolar -Chikkaballapur is a parched region in eastern Karnataka. It has 2,919 villages, none of which has anything in the name of irrigation. Except rains, which are erratic. The region was declared drought-hit in each of the last five years. If only the fields could be irrigated with milk without anyone being called crazy for the suggestion. For, the 1,674 milk cooperatives in the area pick up no less than 925,000 litres every day. Organised under the Kolar District Cooperative Milk Union, they pay Rs 18 for each litre.

About 24,000 litres of this is consumed locally, and the rest sent to Bangalore, and places in Andhra Pradesh and Kerala, which pay between Rs 22 and Rs 23 for each litre. Bangalore region's three districts have a dairy network of their own, which squirts 1.1 million litres a day.

All told, the dairies of Karnataka - there are 12,000 of them - defy the hardships to keep the wheels of the state's rural economy turning and have made Karnataka the second-largest milk producer among states after Gujarat.

Gujarat's dairies make the state No.1 by a fair distance, with procurement at more than twice that in Karnataka. Amul, the brand owned by Gujarat Cooperative Milk Marketing Federation, is Asia's largest dairy brand.

In many ways, Karnataka follows in the footsteps of Gujarat, which, under Verghese Kurien, put the country on course for the White Revolution. But Karnataka' story stands out because the state is less fortunate than Gujarat in industrial development and economic growth. Just 100 km from Bangalore, Kolar-Chikkaballapur remains untouched by the big city's industrial and corporate glitz. Karnataka's per capita income - in 2009/10 prices - was Rs 52,097, compared to Rs 63,961 for Gujarat.

It has been a decade and a half since India overtook the US to become the world's largest milk producer. At the time, India's production was 70 billion litres a day. Today, India accounts for 17 per cent of the global milk output. And there is more to come. India's 70 million dairy farmers have a lot to look forward to, with the demand in the country projected to touch 203 billion litres a day in 10 years, a 64 per cent rise over the current 124.16 billion litres.

K.R. Balasubramanyam

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