MUMBAI:
It's one industry where India lags far behind Pakistan. More importantly, the way our not-so-friendly neighbour has been growing, industry experts warn that India may have to import aseptic paper-based packaged milk from Pakistan in the near future.

Consider this: India and China were in the same league in aseptic packaged milk items 10 years back. Today, China is more than 10 times bigger in size. Even Pakistan's output of aseptic paper-based packaged milk is almost three times that of India. Interestingly, this is despite the fact that India is the largest milk producer with an annual output of 81 billion litres.

During 2001, India's output of aseptic packaged milk stood at 56 million litres, as against Pakistan's production of 162 million litres. China on the contrary produced 590 million litres of aseptically packaged milk last year.

In case of fruit-based beverages, however, India and Pakistan are at par, as far as aseptic packaging is concerned, with an output of 77 million litres each. China is way ahead at 785 million litres.

Aseptic packaging, considered the most effective form of storing milk and beverages worldwide due to its long unrefrigerated shelf life, involves transferring UHT (ultra high temperature) treated milk or fruit based beverages into pre-sterilised packages in a sterile environment. For UHT treatment, milk is heated to a high temperature (135-150 degrees centigrade) in a closed system which is then force-cooled to room temperature.

Says Tetra Pak India managing director Igor Akimov : "The Pakistan government recognises the importance of aseptic technology for milk preservation. The kind of growth that Pakistan has witnessed has not happened in India primarily because of the steep import duties on critical items like filling machine and processing equipments.

"Mr Akimov, was till recently, heading Tetra Pak's operations in Pakistan before taking over as the managing director of Tetra Pak India.

Import duty on packaging equipments in India aggregate to 50.8 per cent, as against 15 per cent in China and 10 per cent in Pakistan. "While 120 aseptic machines were delivered to China and 6 machines were sold to Pakistan last year, Indian companies and cooperatives could not import any due to the high prevailing duty structure. This unfortunately deters upgradation and development of the local dairy industry," says Mr Akimov.

"India is the largest producer of milk and there is no reason why it should import international milk brands. Unfortunately, only a small fraction of the milk produced here is processed and packaged to fully preserve its attributes. We have been telling the authorities in India that packaged milk is not a luxury and the duty structure should enable milk and beverage companies and cooperatives to upgrade so that they can compete effectively both in India and abroad," Akimov added.

As against 84 aseptic filling machines installed in India, China has 644 such equipments while Pakistan instalation base is 105 units.

As a result, while 4.3 billion aseptic packaged milk was sold in China last year, only around 100 million aseptic packages of milk was sold in India last year. Plastic packaged milk accounted for another 9.5 billion units.