Dairy farmers will suffer if FDI is allowed in retail: GCMMF

According to GCMMF,dairy cooperatives generate employment for 15 million households in rural India across 1.4 lakh villages.

Asia’s largest milk producer Gujarat Cooperative Milk Marketing Federation (GCMMF),which markets its dairy products under the brand Amul,today opposed FDI in multi-brand retail saying that Indian dairy farmers would suffer if such a move is allowed.

“If FDI in multi-brand retail is introduced in India,then Indian dairy farmers may end up suffering the same fate as their western counterparts,” GCMMF Managing Director R S Sodhi said at an international conference here.

In USA,dairy farmers share in consumer’s dollar has declined from 52 per cent in 1996 to 38 per cent in 2009. Similarly,in UK,the share of dairy farmers declined from 56 per cent in 1996 to 38 per cent in 2009,he said,referring to the impact of growth of organised retail on farmers.

“Organised retail tends to be monopolistic and access to market often comes at a heavy price to both farmers as well as processors.

“Our cooperatives ensure that Indian farmers get the maximum share-almost 70 to 80 per cent of consumer’s rupee,unlike in the western world. More so because in Indian cooperatives farmers control cent percent of production,processing and most importantly marketing,” he said.

In western country farmers may participate in production and procurement,but for marketing they have to hand it over to MNC’s,Sodhi said.

“Integration with global retail chains which operate across the world,will directly expose Indian consumers as well as Indian farmers to any future global turbulence,” he said.

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According to GCMMF,dairy cooperatives generate employment for 15 million households in rural India across 1.4 lakh villages. By effectively linking rural producers to large urban markets,the cooperatives have ensured a safe future for the dairy farmers of India,Sodhi said.

“Dairy sector can play a pivotal role in our national strategy to combat global economic turmoil and accelerate growth of Indian economy,” he said.

According to Sodhi,Amul has been clocking a year-on-year growth of around 20-25 per cent annually.

“This year we expect to close with a turnover of over Rs 12,000 crore as against Rs 9,700 crore done last year. In last six months,we had some short supply of milk,but now the all India milk production has gone up by 10-12 per cent because of good prices being paid to the farmers,” he said.

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“In the last two years,farmers have effectively got a price hike of over 30 per cent. Last year,we had increased the procurement price by 15 per cent and this year it was hiked by 19 per cent,” he said.

“We are getting 14 million litres of milk per day in Gujarat now,which is 19 per cent more as compared to last year,” he added.

GCMMF has created a supply chain linking 3.1 million farmers in 15,700 villages across 15 districts of Gujarat to its 40 dairy plants and 47 stock points,5,000 distributors and seven million retail stores spread across India and other

parts of the world.