‘Process
or perish’
India
is the largest producer of milk in the world, thanks mostly to the White
Revolution. But low consumption and mediocre processing capabilities
hobble the Indian industry’s march towards global leadership, finds
Amitava Sanyal
More
than half a century ago, Jawaharlal Nehru inspired millions of Indians
to build their agricultural economy with the war cry: “Produce or perish.”
It seemed apt that in a new millennium, his vision would be rephrased
as “Process or Perish.”
These
were the words with which Union Minister for Food Processing Industries
NT Shanmugam opened the 4th National Milk Seminar, held in Goa over
January 17 and 18.
Mr
Shanmugam delineated three barriers that besiege India’s milk industry
– high excise duty, high customs duty on processing machinery, and food
loss worth a whopping Rs 50,000 crore. The first two points were driven
up the priority ladder at the inaugural session even by Tetra Pak India
MD Henrik Hauggaard, who pleaded for lower fiscal barriers. (See interview
on pg 26)
 |
No
1 UHT milk player in India: Gujarat
Cooperative Milk Marketing Federation |
 |
Portfolio
registering highest sales growth: Nestle
India |
 |
Brand
registering highest sales growth: Rajasthan
Cooperative Development Federation (Saras) |
 |
Highest
retail availability: Gujarat
Cooperative Milk Marketing Federation (Guwahati) |
 |
Best
package design: Nestle
India |
 |
Highest
machine utilisation: Andhra
Pradesh Dairy Development Cooperative Federation (Hyderabad) |
Apart
from a promise of pressing the case for lower fiscal barriers at the
Central and State levels, Mr Shanmugam didn’t offer much by way of solutions
for managing the 880 lakh tonnes of milk that he expected India to produce
during this financial year. However, he cued in a subject that held
the promise of revolutionising the Indian milk industry: School Milk.
One
of the principal drivers of growth in milk consumption around the world
has been the School Milk Programme, an initiative taken to different
corners of the world by the Food and Agriculture Organisation (FAO).
The seriousness that the Indian Government invested in this programme
was also apparent when, in his message, Union Agriculture Minister Ajit
Singh underlined the need to learn from Thailand and China in taking
forward the programme.
And
thankfully enough, that’s the direction in which the event unfolded.
While Manh Hung Pham, Business Development Director of Tetra Pak China,
set the field by outlining the structural, geographical and demographic
challenges that a market as vast as China posed, Ding Li, Deputy Director
General of the State Farm Bureau in China, illustrated how political
will could push forward such a mammoth project. Launched in the year
2000 with the participation of seven ministries, the School Milk Programme
in China is now dreaming of accounting for half of the country’s consumption
in about 10 years.
Vichien
Polvatanasug, MD of Nong Pho Dairy Cooperative, Thailand, pointed out
how constancy in policies and the crucial decision of passing on stakeholding
in the School Milk Programme to the end user helped increase per capita
milk consumption in that country from 2 litres to 18 litres.
Dr
Augustine Pinto of Ryan Schools, India’s sole flag-bearer in this leg
of the proceedings, shared with the gathering that his Mimo School Milk
Programme, launched in June 2002, encountered hurdles at odd corners
– from a set of irate parents and the fourth estate for letting brands
“take over” his schools. Thankfully, he persisted. And if Dr Pinto’s
ambitious vision of building 1,000 schools in two decades comes even
close to fruition, School Milk in India would have a formidable champion
indeed.
But
the most passionate cry came from Claes Nermark, the former MD of Tetra
Pak Marketing Services and now a full-time evangelist for School Milk.
He goaded the 100-strong gathering into action by pledging organisational
support from FAO on this programme. Among his nuggets was a gem: Use
toons for school milk packaging with discretion; it may work the other
way too.
Mark
Wynne, MD of New Zealand Milk Asia, laid out the global milk map in
a masterly projection. In his presentation ‘Milk trade: The changing
equation’, Mr Wynne showed how the odds are stacked against the between-the-Tropics
milk-deficient region. He cautioned wannabe exporters to chalk out a
clear roadmap before going all out. Should you export? If you really
do, which markets do you want to enter and with which products? While
CIS countries, China, Southeast Asia, Oceania and Latin America allow
comparatively easier access to their markets with low tariffs, the OECD
(Organisation for Economic Cooperation and Development) countries provide
formidable support to the milk and milk products industry. So where
should one head?
Mr
Wynne carried this soul-searching exercise on to the panel on what it
would take India to become an exporter of milk. He probed whether India’s
enthusiasm to export had more to do with ego than commercial prudence.
Given a domestic population upwards of a billion, possibly we needed
to look at exports as another state of the domestic market. He underlined
the need for focus on quality, value, consistency and a deep, localised
understanding of the export markets.
Anil
Swarup, Chairman of Apeda (Agricultural and Processed Food Export Development
Authority), set the proverbial cat among the milkmen by asking whether
India had it in her to sustain brands. He put packaging, positioning
and quality assurance on a pedestal and illustrated his case by saying
that a single mango has managed to fetch even Rs 100 at Selfridges,
the British superstore. As a man who parleys with organisations around
the world, Mr Swarup predicted that non-tariff barriers like subsidies
would come down around the world. The European Union had already climbed
down from its high perch by agreeing to cut its farm subsidies substantially.
DP
Tripathi, who retired as Secretary at the Ministry for Food Processing
Industries in 2002, pointed out the systemic problems that a nation
like India posed. It takes about 2 years to run a product through the
Central Food Standard Authority – can any market wait? And the decision
of the authority is deemed final, as there are no appellate authorities.
Mr
Hauggaard of Tetra Pak India wrapped
up the proceedings with the welcome
announcement of the launch of a nationwide campaign promoting UHT (ultra
high temperature) milk in April 2003. The two long days of brainstorming
came to
an end as the UHT Milk Marketing 2002 awards (see box on page 24) were
given out
to the deserving bunch on a balmy beach
in Goa. As the gathering unwound, milk
receded to the back of everyone’s mind
for the first time in two days, and feni
took precedence.
