The Kaira District Co-operative Milk Producers’ Union got here into being on December 14, 1946, nicely earlier than Verghese Kurien arrived in Anand. The credit score for creating the cooperative – which was already amassing some 7,250 litres of milk each day from nearly 2,000 farmers in 27 villages when the 28-year-old mechanical engineer joined as supervisor on January 1, 1950 – goes to Sardar Vallabhbhai Patel, Morarji Desai and, in fact, the redoubtable Tribhuvandas Patel.
But it was Kurien who remodeled what was nonetheless an early idealistic experiment – of banding collectively rural producers for promoting on to shoppers sans any middlemen – right into a full-fledged sensible imaginative and prescient that may very well be prolonged past a single district and even milk.
That imaginative and prescient wasn’t restricted to processing the produce of farmers: The Kaira Union had only a rundown authorities creamery taken on lease earlier than Kurien got here in. By 1950, it had a correct plate pasteuriser that might deal with as much as 57,000 litres of milk per day, adopted by a spanking new dairy in 1955. This one had twice the capability, whereas additionally able to changing extra milk procured throughout the “flush” winter season into powder and butter for recombining within the “lean” summer season months. The powder plant – outfitted with a Niro Atomiser, the world’s first ever designed for spray drying of buffalo milk – enabled Kaira’s farmers to seize the financial worth of solids-not-fat (SNF). Previously, solely the 7-8% fats of their surplus milk may very well be conserved and made into ghee; the remaining SNF portion (containing protein, sugar and minerals) needed to be thrown away.
Nor was that imaginative and prescient confined to working with farmers: Payment for milk based mostly on fats and SNF content material, and measuring these for each litre poured on the village society assortment centres, is amongst Kurien’s many lasting legacies. It was a system – farmers being paid each for amount and high quality of milk equipped – even organised personal dairies have been pressured to undertake. The Kaira cooperative was, from the early fifties, additionally offering synthetic insemination and veterinary assist for its farmers. By end-1964, the Union had its personal breeding centre for manufacturing of semen from bulls whose mom have been confirmed excessive milk yielders, apart from India’s largest compound cattle feed plant. In addition, it was distributing inexperienced fodder seeds to its 85,000 farmers, who have been now supplying over 1.6 lakh litres per day (LLPD) of milk on a median.
Kurian’s Farmer-to-Consumer Model
For Kurien, a rural cooperative’s position wasn’t merely to course of its members’ produce and making accessible yielding-enhancing inputs/companies, but additionally hyperlink them to the ultimate shopper. That required making a model distinguishing their product from others’.A Nestle’s, Hindustan Lever’s or GlaxoSmithKline’s most treasured belongings lay not of their factories and actual property, however within the shopper manufacturers they owned. An organization’s model portfolio transformed mere undifferentiated commodities into shopper merchandise. Kurien was clear that the Kaira Union wouldn’t be a contract provider to different corporations – B2B (Business-to-Business) in as we speak’s parlance. His mannequin was F2C (Farmer-to-Consumer). The true worth of a farmer’s produce was realised solely when offered to the end-consumer, who needed to be “milked”, albeit gently. Kurien wasn’t going to permit any person else to skim the cream off the farmer’s milk that rightfully was hers.
The model that the Kaira Union unveiled in October 1955 was not for nothing known as ‘Amul’ – actually, invaluable. Amul and the little moppet lady endorsing the cooperative’s “utterly butterly delicious” merchandise linked immediately with shoppers. The model, as Kurien put it, was a “contract with consumers”. Amul merchandise needed to meet or surpass their expectations, style good and “always represent the highest hygienic, bacteriological and organoleptic standards”.
The above built-in philosophy recognised a fundamental actuality of rural India, the place most individuals possessed little land, cash and even productive animals. What they primarily had was labour energy – the capability to place of their household assets for rising crops and rearing livestock. For them, return on “labour”, not “capital”, mattered. The one establishment that might assist – by procuring, processing and advertising and marketing their produce in essentially the most environment friendly method – was the cooperative. Through this organisation, it was doable to have their very own processing amenities, interact skilled managers, and entry inputs and companies to make them additional productive. They might, thus, collectively personal and overcome what they couldn’t individually.
The Kaira Union that Kurien nurtured totally confirmed to this idea. Its milk producers have been members of village-level cooperative societies whose managing committees they elected. Those representatives, in flip, elected the chairman and administrators of the Union’s board that ran the Amul dairy by way of a chief government and different professionals that included undertaking engineers, veterinary medical doctors, agronomists and nutritionists. This cooperative was as enterprise oriented as any firm, besides that it sought to maximise returns to producer-members. And that was when it comes to milk worth – as towards share worth appreciation or dividends – and offering high quality cattle feed, synthetic insemination and animal healthcare companies.
The Kaira cooperative – its operations spanned the whole worth chain from manufacturing inputs and procurement to processing and advertising and marketing – grew to become the “live lab” for Kurien to copy the mannequin first throughout Gujarat. By 1974, there have been 5 different district unions – of Surat, Baroda, Mehsana, Banaskantha and Sabarkantha – that, together with Kaira, fashioned an apex Gujarat Co-operative Milk Marketing Federation (GCMMF). Kurien wouldn’t have minded that the final three grew to be greater than the unique Kaira Union. If something, it was testimony to the Amul mannequin’s success. When he demitted workplace as GCMMF chairman on March 20, 2006, its unions have been collectively procuring a median 62.5 LLPD of milk from 24.9 lakh producer-members. In 2020-21, these numbers had additional swelled to 239 LLPD and 36.four lakh, respectively. So too had GCMMF’s gross sales turnover, from Rs 3,773 crore in 2005-06 to Rs 39,248 crore in 2020-21.
The GCMMF unions have largely remained trustworthy to Kurien’s beliefs. Notwithstanding the intrusion of occasion politics, which neither Tribhuvandas Patel nor he permitted throughout their time, these haven’t affected the day-to-day operations of cooperatives or not less than the pursuits of their farmer-members. One indicator is the procurement worth paid by the Gujarat unions. At a median Rs 795 per kg of fats in 2019-20, it translated right into a worth of Rs 49.1 for a litre of full-cream milk retailing at Rs 58. In different phrases, an almost 85% share within the shopper rupee that Kurien would have been happy with.
But Kurien’s all-encompassing sensible idealism is one thing his successors – notably on the National Dairy Development Board (NDDB) – didn’t imbibe. This was one other establishment he had based in 1965 with the intention of taking the Amul mannequin nationally. While the push got here from Prime Minister Lal Bahadur Shastri, Kurien had proposed the institution of an ‘Indian Dairy Products Marketing Board’ as early as March 1957. The finest solution to increase milk manufacturing, he wrote, was “by arranging to market, in an organised manner, whatever milk is at present produced”. If the processing and advertising and marketing of milk was completed nicely, farmers may very well be paid larger costs, making them make investments extra in dairying: “Where he kept one milch animal, he will now keep two. He will become more receptive to modern ideas of better breeding, feeding and management of cattle. A revolution in the Indian dairy industry will then have begun”.
Building markets for farmers’ produce – Kaira wouldn’t have occurred with out Bombay – was a key aspect of the NDDB’s Operation Flood programme launched in 1970. The liquid milk markets in main city centres have been to be developed and the elevated demand from that met, initially, by way of the provision of recombined powder and butter oil donated by the European Economic Community. These gifted commodities have been to not be dumped, however offered at costs excessive sufficient to take care of incentives for home milk producers. Once an organised advertising and marketing system alongside enhanced processing capacities – financed from the proceeds of the free imports – have been in place, the cities may very well be “flooded” with milk from rural areas. No economist would have thought up such an modern “priming the pump” answer that resulted in India turning not simply self-reliant but additionally the world’s largest milk producer on the flip of the century.
Unfortunately, the NDDB management post-Kurien selected an alternate route completely undermining the imaginative and prescient of farmers proudly owning establishments that gave them management over the entire worth chain from the sector to retail retailer. The Mother Dairy in Delhi, a subsidiary unit of NDDB initially envisaged to be handed over to the state cooperative federations, was transformed into a company entity competing with their manufacturers. For Kurien, cooperatives have been an article of religion. It led him to additionally provoke an Oilseeds Growers’ Cooperative Project in 1979 that, inside a decade, had half-a-million-plus farmers underneath its fold. Operation Golden Flow was meant to do to vegetable oils what Operation Flood had achieved in milk. Instead, NDDB’s ‘Dhara’, India’s prime edible oil model until the nineties, quickly misplaced market share. This was equally the end result of the powers-that-be in New Delhi permitting unbridled edible oil imports, which as we speak account for two-thirds of the nation’s home consumption and an annual international change outgo of $11 billion.
The NDDB and Indian policymakers nonetheless sing paeans to cooperatives. But the so-called farmer producer organisations or corporations they speak about are, at finest, contract suppliers to massive corporates that take the cream and share the crumbs. That’s not what Kurien had in thoughts when he dreamed of the agricultural producer being empowered to take cost of her personal future. That dream shall reside endlessly. It might not be a coincidence that Kurien’s delivery centenary coincides with one 12 months of the farmers’ protests at Delhi’s borders. Fulfilling his dream could be an everlasting answer for his or her restiveness.
(The author is National Rural Affairs & Agriculture Editor of The Indian Express and presently on sabbatical with the Centre for Policy Research, New Delhi)