The political row over Gujarat Cooperative Milk Marketing Federation (GCMMF) entering the Bengaluru market, and supposedly threatening the local Karnataka Cooperative Milk Producers’ Federation (KMF), is both unfortunate and unwarranted. Unfortunate, because what should be a matter of economic competition in the marketplace has been turned into an emotive issue and misplaced subnationalism, amplified by the ongoing Karnataka state elections. Unwarranted, because, as this newspaper has reported, GCMMF’s Amul brand milk and curd are priced 20-40 per cent higher than KMF’s Nandini. Even if GCMMF comes to Bengaluru, it is unlikely to really eat into Nandini’s market share. But Amul or any other player shouldn’t be prevented from trying, just as the Bengaluru consumer must not be deprived of competition that could take the form of better quality or product differentiation. Incidentally, Amul has been selling in northern Karnataka markets since around 2015 – without inviting any provincial ire.
The current brouhaha is probably also a reflection of rivalry between India’s two largest dairy cooperatives. Amul is, of course, the original big brother. Its unions, in 2021-22, procured an average 264 lakh kg per day (LKPD) of milk, including around 43 LKPD from outside Gujarat. Nandini’s was only about 82 LKPD, much of it from the southern old Mysuru region districts. But the procurement increase, from a mere 30 LKPD in 2007-08, has been impressive and largely courtesy of a Rs 6-per-litre incentive given to farmers supplying to the KMF unions. The incentive, over and above their procurement price, has given a huge stimulus to dairying in Karnataka. Successive governments, whether of the BJP under B S Yediyurappa or the Siddaramaiah-led Congress, can take credit for Nandini’s growth, which has also been enabled by captive markets (Bengaluru, Mysuru and Mangaluru) not far from its main milk-shed areas.
