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Home » A SECOND WHITE REVOLUTION AMIDST COVID-19?

A SECOND WHITE REVOLUTION AMIDST COVID-19?

GS 2: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

 

Context

Covid-19 pandemic has thrown up the real possibility for our dairy industry to benefit as large sections of consumers may shift from meat-based to dairy-based protein. Covid-19 has made people more aware of the need to adopt a healthy diet.

In contrast to sectors like construction, manufacturing, hotel, travel & tourism, etc, which were severely hit by the lockdown restrictions, dairy industry seems to have done remarkably well. Globally, Covid-19 impact has pushed many large commercial dairy farms even in the most dairy developed nations to the brink of closure, prompting governments to announce bailouts. Recently, Trump administration announced a bailout package of $15.5 billion for the US dairy industry. The US is contemplating to purchase milk, convert it into commodities which could be used as international humanitarian aid.

White revolution or Operation Flood

Operation Flood, launched on 13 January 1970, was a landmark project of India's National Dairy Development Board (NDDB), the world's biggest dairy development program. It transformed India from a milk-deficient nation into the world's largest milk producer, surpassing the US in 1998, with about 17 percent of global output in 2010–11. In 30 years it doubled milk available per person and made dairy farming India's largest self-sustainable rural employment generator. It was launched to help farmers direct their own development, placing control of the resources they create in their own hands. All this was achieved not merely by mass production, but by production by the masses; the process has been called the white revolution.

The Anand pattern experiment at Amul, a dairy cooperative, was the engine behind the success of the program. Verghese Kurien, the chairman and founder of Amul, was named the chairman of NDDB by the then Prime Minister of India Lal Bahadur Shastri. Kurien gave the necessary thrust using his professional management skills to the program, and is recognized as its architect.

 

Covid-19 and initial distress in dairy sector

More than 70 per cent of milk is being produced by small farmers; milk provides immediate cash for their livelihood. These small farmers are worst hit due to lower demand and consequently no/partial procurement. The major share of milk is handled by the unorganised sector comprising milkmen, milk contractors, halwai shops/ creameries/city-based private dairy shops etc., while only 30 per cent is handled by the organised sector — dairy cooperatives and private milk plants. Milk is a perishable product and it can’t be stored without proper processing. That is why reports of dumping of fresh milk by farmers are coming in from different parts of the world. In the Indian dairy sector, milk is collected twice a day (morning and evening), unlike the developed countries where it is stored in silos at dairy farms and collected by dairy plants on a weekly or biweekly basis. With the drop in milk demand, the sale of dairy products, particularly value-added products, has also gone down. Private plants which are mainly involved in the production of value-added dairy products were witnessing a major liquidity crisis.

Globally, Covid-19 impact has pushed many large commercial dairy farms even in the most dairy developed nations to the brink of closure, prompting governments to announce bailouts. Recently, Trump administration announced a bailout package of $15.5 billion for the US dairy industry. The US is contemplating to purchase milk, convert it into commodities which could be used as international humanitarian aid.

The Covid Vs Dairy Sector scenario

As news started trickling about supply chain disruptions, governments, both central, and some states, swung into action to ameliorate the situation. These interventions included making available low-cost working capital to producer-owned institutions to convert milk into skimmed milk powder (SMP) and milk fat, direct procurement of surplus milk for conversion and direct distribution to needy people.

To enhance the marketing of milk and milk products, many dairy organisations, initiated home delivery of milk and milk products through mobile carts, vans, e-commerce, etc. All these measures helped stabilise milk sales, opening up opportunities to use e-commerce. Many smart and progressive dairy farmers converted their surplus milk into khoa, paneer, ghee, etc, and sold it to the neighbourhood markets through informal channels. All these measures helped sustain dairy industry.

Covid-19 pandemic has thrown up the real possibility for our dairy industry to benefit as large sections of consumers may shift from meat-based to dairy-based protein. Covid-19 has made people more aware of the need to adopt a healthy diet. In contrast to sectors like construction, manufacturing, hotel, travel & tourism, etc, which were severely hit by the lockdown restrictions, dairy industry seems to have done remarkably well.

Way forward

India may consider reducing GST on ghee and milk fat, from 12% to 5% to bring it at par with the GST rate for SMP. This has been a long-standing demand of the dairy industry and will ultimately benefit milk producers, increase rural incomes, spur demand and hasten economic recovery.

During these difficult times of the dairy farmers, cows and buffaloes must be taken care of, as any compromise on their feeding and health care would impact reproductive efficiency and productivity. Both governments and dairy cooperatives should provide these inputs and services to the farmers on subsidised rates or deferred payments basis. The country cannot afford to go through another phase of supply disruption resulting in pressures on availability and prices of milk. Covid-19 crisis has witnessed reverse migration of labour force from urban to rural areas leading to social disruptions. On the positive side, we can look at this as an opportunity; these workers can be encouraged and incentivised to join their family agriculture/dairy farms.

 

Previous Year Questions

  1. The basis of providing urban amenities in rural areas (PURA) is rooted in establishing connectivity Comment. (2013)
  2. Two parallel run schemes of the Government, viz the Adhaar Card and NPR, one as voluntary and the other as compulsory, have led to debates at national levels and also litigations. On merits, discuss whether or not both schemes need run concurrently. Analyse the potential of the schemes to achieve developmental benefits and equitable growth. (2014)
  3. Hunger and poverty are the biggest challenges for good governance in India still today. Evaluate how far successive governments have progressed in dealing with these humongous problems. Suggest measure for improvement. (2017)
  4. The emergence of the self-help groups (SHGs) in contemporary times points to the slow but steady withdrawal of the state from development activities.” Examine the role of the SHGs in developmental activities and the measures taken by the Government of India to promote the SHGs. (2017)
  5. There is a growing divergence in the relationship between poverty and hunger in India. The shrinking of social expenditure by the government is forcing the poor to spend more on non-food essential items squeezing their food-budget. Elucidate. (2019)
  6. Performance of welfare schemes that are implemented for vulnerable sections is not so effective due to absence of their awareness and active involvement at all stages of policy process. Discuss. (2019)