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CHAPTER 3

PROFILE OF THE DAIRY COOPERATIVES IN INDIA

3.1 GLOBAL DAIRY SCENARIO

Cooperatives dominate dairy industry not only in India but also around the

World. In the United Kingdom, all the milk produced by farmers is procured by

cooperatives. There are no private sector dairy plants in New Zealand. A total of

90 per cent of the dairies in former West Germany are cooperative, and in

Denmark, Netherlands and Sweden the entire dairy industry is organized on

cooperative lines. In the USA, 70 per cent of the dairy industry is in cooperative

sector. Dairy programmes are subject to significant government participation and

regulation than most other domestic agricultural industries in the USA.

Annexure 1 represents the comparison of the milk production in India with

other countries of the world for 8 five year periods, from1970 to 2010. It is

important to note that India's percentage share in total world milk production has

kept upward trend, competing with USA for top position. In the beginning of year

1997 India's milk production was on par with USA, which was ranked second by

producing 70.80 million tons of milk in that year. India held the First rank in the

production of milk to the tune of 70.88 million tons in the same year 1997 itself by

over taking the United States and thereafter it become the world largest milk

producer. (See the Annexure 1 Milk production across countries)

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3.2 GROWTH OF DAIRY IN INDIA

The green revolution in India has now reached stagnation. In such a case,

there is a need for diversification of crop production system by greater integration

of livestock and inland fisheries. Fortunately, various government initiatives

through the promotion of dairy cooperative movement under Operation Flood

Programme and several other dairy production schemes have resulted in

augmenting milk production at an average annual growth of 4.5 per cent. The

implementation of Operation Flood brought a "White Revolution" in India with milk

production increased from 21.2 million tonnes per annum in 1968-69 to 66

million tonnes by 95-96, at the end of project period.

Indian dairy sector mainly depends on the small producers who have one or

two milch animals yielding 3-4 litres of milk per day. Dairy sector in India is part of the

farming system, so the Indian dairy is managed with lower capital investment. The

milch animals are generally fed with crop residues, agricultural wastes, compound

cattle feed and oil seed cakes which makes dairy farming profitable. The Royal

Commission on Agriculture observed that the cow and the working bullock carry

on their pertinent back the whole structure of the Indian agriculture. The growth

pattern of the livestock production vis-a-vis GDP during 2004-05 to 2010-11 is

furnished in Annexure: 2. It can be observed livestock production was Rs.119333

Crores in the initial year 2004-05 which increased to Rs.260300 Crores in the

terminal year 2010-11, recording 118 per cent increase over 7 years period. Live

stock production as percentage GDP has been fluctuated between the lowest of

3.6 per cent in 2006-07 and the highest of 4.0 per cent in 2004-05.

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Annexure 3 presents annual average growth rates of cattle, buffalo,

bovine and livestock population for five year periods stating from 1951-56 and

ending with 2003-2007. It can be observed that adult female buffaloes have

witnessed a growth rate more than female cows till 1997-2003. During 2003-2007

the adult female cow annual growth rate was more than the adult female buffalo.

Bovine population has grown at lower rates than other livestock population.

The Milk Animal Population by States is presented in Annexure 4 during

the year 2007. The total Cows and Buffaloes during the period between 2006-

2007 are 127390 thousands, out of which female buffaloes as over 3 years were

54474 thousands, crossbred cows 16156 thousands and Indigenous over 3 year

were 72916 thousands. The crossbred population is nearly 13% to the total

population.

Annexure 5 shows the milk production India and per capita availability of

milk during 1991-2012. It can be observed that there is a steady growth of milk

production and per capita availability over the years. Despite its being the

largest milk producer in the world, its per capita milk availability is one of the

least in the world. In the year 2010, the per capita availability of milk was 273 gms

per day.

3.3 ORIGIN AND GROWTH OF COOPERATIVE DAIRYING IN

INDIA

From the early days milk production was entirely on a decentralized basis

and collection of milk was attempted by a few private marketing organizations

like Keventers and Paulsons whose setup plants for producing table butter in

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some areas and also started selling liquid milk to some institutions and military

establishments. Due to the absence of a system of dairying based on commercial

line to meet the demand of the growing urban population, the gap between

demand and supply in cities continued to grow and acute shortage was felt in

many areas. Private vendors took full advantage of such shortages by large

scale adulteration of milk and also charged high prices for poor quality milk. On

account of the general exploitation by the private vendors and as a measure for

counter-acting these acute shortages, a few cooperative milk supply societies

were started during the second and third decades of this century but these

societies were invariably consumer oriented and they did not try to organize the

producers or to provide facilities and inputs for increasing milk production.

The first dairy cooperative society was registered in 1913 at Allahabad in

UP and was called “KATRA Cooperative Dairy Society”. Soon, there after seven

Dairy Cooperative societies were registered at Baroda, Belgaum, Dhulia,

Bhagalpur, Hubli, Bagalkot, Calcutta. Between 1914 and 1919 seven more

societies were formed. In the year 1919, Calcutta Co- operative Society (CCS)

was started in Nagpur. In 1927 Madras Milk Supply Union came into being with

first processing facilities. In 1932, the Lucknow Milk Producers Co-operative Union

Limited was established. In 1945, Aarey Milk Colony was established by the

Bombay government under the Greater Bombay Milk Scheme. During the

Second World War, the increased demand for milk and milk products from the

army and acute shortage of milk in various urban areas gave a new push to the

organization of milk cooperatives and a number milk supply societies were

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registered in different parts of the country, particularly in the then Bombay and

Madras States which included parts of the present States of Gujarat and Andhra

Pradesh. Most of the societies however continued to be consumer oriented.

Thereafter, till Independence there was no significant progress in the

development of diary co-operatives. However, after Independence, the first large

scale and systematic break-through in dairy co- operatives in India was made in

1948 by the Kaira District Co- operative Milk Producers Union at (KDCMPU)

Anand, ultimately, the union came to be known as the Anand Milk Union Limited,

abbreviated to "Amul" which in vernacular means 'highly valuable' or 'beyond all prices'.

Around this time, the Government of India also decided to make arrangements

for the supply of hygienic milk to Bombay city and this resulted in organized

collection of rural milk produced in Kaira District and its bulk transport by rail to

Bombay for distribution. This was the first organized link-up of rural milk shed

with major urban market. However, only the collection and transport of milk was

controlled by the cooperatives and they had no say in its sale in the urban areas

which was controlled by Government agencies. The dairy co-operatives in Kaira

district under the able guidance of Shri Thribhuvandas Patel and Dr. Varghese

Kurien, its chairman and general manager respectively, followed an integrated

approach to dairy development linking all the major elements of dairying viz.,

production, procurement, processing and marketing and achieved remarkable

progress.

3.3.1 Recommendations of working group, committees and conferences

The need for developing Dairy Cooperatives and the strategies to be

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adopted, have received attention from time to time of various Working Groups,

Committees, Conferences, etc., Some of the recommendations and suggestions

made are indicated below.

Conference of the Registrars of Cooperative Societies suggested that

special attention should be paid by the cooperatives to proper maintenance,

feeding and treatment of livestock, to the production of requisite green fodder

and concentrates their supply at favourable rates.

The Working Group (1962) recommended that where there was a

concentration of rural milk producers, separate milk producers cooperative

societies should be organized and to coordinate and provide technical guidance,

State Federations of Dairy Cooperatives should be organized at the State level.

The Working Group also endorsed the proposal made in the Third Plan that dairy

development should be attempted mainly through cooperatives and

recommended active steps for implementing this policy.

The Fourth Five Year Plan stated the pattern of organization of primary

milk producers’ cooperatives would need modification and it will be necessary to

work towards a progressive cooperativization of Government milk plants so that

the entire chain of operation from milk collection, transport, pasteurization and

distribution gets integrated.

3.3.2 Formation of the National Diary Development Board and IDC

Inspired by the success achieved by the Kaira District Cooperative Milk

Producers Union, Anand (Amul), the Government of India, Ministry of Agriculture

constituted on 26th September 1965 a National Dairy Development Board

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(NDDB) to organize and oversee the planning and execution of dairy

development programmes on national scale and to provide technical guidance to

various States in setting up projects for overall development of milk production,

processing and marketing in the country by making available on request,

technical and consultancy services on all relevant aspects. The Indian Dairy

Corporation (IDC) was set up in 1970 to handle the donated commodities, the

generation of funds and their disbursement for the generation of funds for the

dairy development programme.

3.3.3 Recommendations of the National Commission on Agriculture

The National Commission on Agriculture recommended that steps should

be taken to establish strong cooperative organization of primary milk producers

all over the country. It also recommended that Government should adopt a

rational pricing policy for milk, which will take care of the interests of both the

producers and the consumers. These recommendations were accepted by

Government in 1976.

3.3.4 OPERATION FLOOD I (1970-81)

In 1969-70 NDDB developed an ambitious integrated scheme for

development of the dairy industry and marketing of milk, which is commonly

known as “Operation Flood”. The first stage of the scheme-Operation Flood I was

approved on 17th October 1969. The Project envisaged the use of dried Skim

Milk Powder (SMP) and Butter Oil (BO) donated by the World Food Programme

for recombination into milk by modern dairies in the four metropolitan cities of

Bombay, Calcutta, Madras and Delhi and crediting the value of these donated

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commodities on an agreed basis to a fund for financing dairy development

programmes. The plan of operation for the project was signed by the

Government of India and the WFP on 4th March 1970 and the first utilization of

the commodities was recorded as 1st July 1970. The project which was initially

scheduled for a period of 5 years, was subsequently extended thrice to 11 years

and finally terminated on 30thJune 1981. WFP supplied 1,23,973 tonnes of SMP

and 41,510 tonnes of Butter Oil. Rs 116.6 crores generated by the transfer of

these commodities to the dairies, was credited to the Indian Diary Corporation, a

public sector undertaking and utilized by the IDC for financing the approved dairy

development programmes in the four metropolitan cities and related rural milk-

sheds which were being developed for supplying milk to the four cities.

The IDC had stipulated that programmes under Operation Flood should be

implemented through a three-tier cooperative structure comprising of primary

milk producers cooperative society at the village level, a District cooperative milk

producers’ union at the district level to which the village level primary societies

will be affiliated, and an apex milk producers’ Cooperative Federation at the State

level formed by Federating the milk unions. This was based on significant

success achieved by ‘Amul’ and the policy profile laid down by the National

Commission on Agriculture and the Planning Commission. This was

supplemented in some States like Tamil Nadu and Maharashtra with dairies and

milk cooperatives set up with financial and other assistance from the NCDC and

the state Government.

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3.3.5 OPERATION FLOOD II (1981-1985)

Operation Flood II was in effect a continuation of the development

programmes initiated in Operation Flood I. It was designed to cover 155 districts

in 25 milk sheds for organizing milk production and milk collection and to link 148

(including the four metropolitan cities) cities with a population of over 1 lakh in the

1971 census, to these rural milk sheds via a National Milk Grid. The financial

investment proposed was roughly four times that of Operation Flood I. The

programme was approved by the Government of India, for implementation during

the Sixth-Plan period, with an outlay of Rs. 273 Crores. About US$ 150 millions

were provided by the World Bank and the balance in the form of commodity

assistance from the European Economic Community (EEC). The project was

extended to 34500 village co-operative societies, covering 36 lakh farmer

members. The peak milk procurement increased to a level of 79 llpd and milk

marketing to 50 llpd. It also aimed at building up a rural cooperative infrastructure

for achieving the above objectives and also for modernizing the dairy industry.

Most of the development was to centre around the milk sheds already selected

and developed during Operation Flood-I. The cooperative structure proposed to

be built up was to consist of approximately 25 “cluster federations” of milk

producers, unions which were expected to carry out milk production, processing

and marketing activities on a viable basis and obtain a commanding share of

liquid milk markets in all the cities with population of one lakh or more by 1984-

85.

3.3.6 OPERATION FLOOD III (1985-2002)

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The third phase aimed at consolidation of the gains of earlier two phases. The

main focus of the programme was on achieving financial viability of the milk

unions state federations and adopting the salient institutional characteristics of

the "Anand Pattern" co-operatives. In 1987, NDDB was declared an institution of

national importance and a statutory body by an Act of Parliament. The Operation

Flood-III programme was funded by World Bank with a loan of US $ 365

millions, Rs.222.6 crores of Food-Aid (75,000 tonnes of milk powder and 75,000

tonnes of butter/butter oil) by the EEC and Rs. 207.7crores by NDDB from its

own resources. The programme covered some 170 milk sheds of two countries

by organizing 70,000 primary dairy cooperative societies. The World Bank

granted provisional extension of Operation Flood-III credit up to April 30, 1996. Its

major emphasis was to consolidate the achievements gained during the earlier

phases by improving the productivity and efficiency of the co-operative dairy

sector and its institutional base for its long-term sustainability. Investments in

Operation Flood-III were focused on strengthening the institutional management

aspect of dairy co-operatives at various levels to establish financially strong,

farmer owned and managed organization.

The Operation Flood III also had provision for productivity enhancement

inputs and institutional strengthening in the form of training, research, market

promotion, monitoring and evaluation. Particular emphasis was placed on

institutional and policy reforms. Efforts were made to expand infrastructural

facilities in all major markets, linking them to milk sheds through the National Milk

Grid (NMG) to ensure year-round stable milk supply. Annexure 6 displays

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progress of dairy development during three phases Operation Flood under four

broad parameters namely procurement, processing capacity, market and

technical inputs. Between 1971 and 2000 all the indicators of milk procurement

witnessed 4-digit increase in percentage terms. With regard processing capacity,

the percentage growth in processing capacity was more in metro dairies (4-digit

increased) than in rural dairies (3-digit increase). In milk marketing dairies in and

around towns either than those in metros had a cites better record (4-digit

increased) and the same can be in the case of milk marketing powder. In

permission of technical inputs there was a 3- digit increase in all the parameters.

3.3.7 Technology mission on dairy development

The Operation Flood programme prepared the ground for launching

another massive Programme at the national level called 'Technology Mission on

Dairy Development' (TMDD). The mission formally launched on June, 1988

started functioning from June, 1989 with the main objective of accelerating the

pace of growth of rural incomes and employment through dairy development. To

achieve this end, the Operation Flood programmes are being dovetailed into

other development programs such as the state programmes of animal

husbandry and dairying, poverty alleviation programmes such as Integrated

Rural Development Programme (IRDP), dairy research programmes, processing

technology and product manufacturing programmes of the central research

institutions, Agricultural Universities and National Dairy Development Board. The

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technology mission covered all the districts under Operation Flood programme in

1996-97. An additional 13,000 village level primary dairy co-operatives were

organized by the State Governments in the Operation Flood districts. The

mission’s achievements during the period 1988-89 to 2001-02 are shown in the

Annexure 7.

The TMDD covered 242 districts in 1988 which steadily increased to 270

in 1996 and decreased to 265 in 2001. Correspondingly the number of milk sheds

rose from 168 to 190 and decreased to 185 in the same periods. Another

important achievement of technology mission was in the co-operative societies

formed about 49,077 to 70,000 and decreased to 65,000 in the same period. The

average milk procurement was nearly doubled from 78 lakh liters per day (llpd) to

150 llpd with the corresponding increase in the milk marketing from 67 llpd to120

llpd during 1988 to 2001. The processing capacity of rural and urban dairies was

enlarged from 122 llpd and 37 llpd to 220 llpd and 48 llpd, and decreased 180 llpd

and 40 llpd respectively. Thus when compared to metro dairies, the capacity of

rural dairies increased at a faster rate. The average milk yield of both cows and

buffaloes was doubled during the 10-years period.

3.4 THE PRESENT SCENARIO

The efforts of the Department in the dairy sector are concentrated on

promotion of dairy activities mainly in non-operation flood areas with emphasis

on building up cooperative infrastructure, revitalization of sick dairy cooperative

federations and creation of infrastructure in the States for production of quality

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milk and milk products. The Department is implementing four schemes in the

dairy sector during 11th Plan. The National Dairy Development Board (NDDB)

continues its activities for the overall development of Dairy Sector in Operation

Flood areas.

3.4.1 Intensive Dairy Development Programme (IDDP)

The scheme ‘Integrated Dairy Development Programme (IDDP) in Non-

Operation Flood, Hilly and Backward Areas’ was launched in 1993-94 on 100%

grant-in aid basis. The scheme was modified in March, 2005 and was named as

‘Intensive Dairy Development Programme (IDDP)’. The scheme is presently

being implemented in hilly and backward areas and also in districts, which

received less than Rs. 50 lakh for dairy development activities under Operation

Flood programme.

Since the inception of the scheme, 99 projects have been approved. Out

of these, 55 projects are under implementation and 44 projects have been

completed. 229 districts were covered in 27 States and a UT with a total outlay of

Rs. 588.26 crores till 31st December 2011.

3.4.2 Strengthening Infrastructure for Quality and Clean Milk Production

The scheme aims at (i) creation of infrastructure for production, testing

and marketing of quality milk & milk products at the farmers level up to the points

of consumption, (ii) training and strengthening of infrastructure to create mass

awareness about clean milk production (iii) to improve the quality of raw milk

produced by providing training and creating mass awareness among milk

producers and also by installation of Bulk Milk Cooling facilities at milk collection

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centers for immediate chilling of raw milk.

The pattern of funding is 75% Grant in-aid for all components by GOI to

profit making Milk Unions and 100% Grant-in-aid for all other Milk Unions. The

scheme is implemented through the State Government by the District Level Coop

Milk Unions/State Level Coop Milk Federation. Since inception, the Department

has approved 158 projects spread over 23 States and one UT at a total cost of

277.83 crore with a Central share of 226.70 crore till 31.12.2011. About 6.22 lakh

farmer members have been trained and 1,974 Bulk Milk Coolers (BMCs) with a

total chilling capacity of 39.45 lakh litres have been installed and 1,323 existing

laboratories have been strengthened.

3.4.3 Assistance to Cooperatives

This scheme started during 1999-2000, aims at revitalizing the sick dairy

cooperative unions at the district level and cooperative federations at the State

level. The rehabilitation plan is prepared by National Dairy Development Board

(NDDB) in consultation with the concerned State Dairy Federation/District Milk

Union. Each rehabilitation plan is to be implemented within a period of 7 years

from the date of its approval. Since inception, the Department has approved 39

rehabilitation proposals of Milk Unions at a total outlay of Rs. 296.83 crore and

with a central share of Rs. 148.69 crore till 31st December, 2011. The scheme is

being implemented on 50:50 sharing basis between Govt. of India and the

concerned State Governments.

3.4.4 Dairy entrepreneurship development scheme

A new scheme in place of the earlier Dairy Venture Capital Fund (DVCF)

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has been launched by this department with effect from 1.9.2010 for promoting

investment in the dairy sector called “Dairy Entrepreneurship Development

Scheme (DEDS)”. This scheme is being implemented through NABARD and

provides for financial assistance to commercially bankable projects with loans

from commercial cooperative and rural banks along with a capital subsidy of 25%

(33.33% for SC & ST beneficiaries) as Central assistance. The scheme aims at

increasing investment in dairy sector for increasing milk production in the country

while helping in poverty reduction through self-employment opportunities. All the

components under the scheme can be availed throughout the country. States

need to actively promote and popularize this scheme. The major changes made

in the new scheme (DEDS) are: Back-ended capital subsidy of 25% (33.33% for

SC/ST) has been provided instead of Interest Free Loan (IFL). The scheme Dairy

Entrepreneurship Development Scheme has been implemented from 1st

September, 2010.

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3.4.5 Strengthening the cooperatives

During 2010-11, NDDB continued to provide technical and financial

support to dairy cooperatives in the areas of strengthening cooperative business,

productivity enhancement, quality assurance, building dairy infrastructure and for

creation of a national information network. Up to 30th November 2011, plans of

about 100 dairy cooperatives, with a total outlay of Rs. 2,334 crore had been

approved by NDDB under the Perspective Plan. Of this, NDDB’s financial

assistance was to the tune of Rs. 1,898 crores.

3.4.6 Animal Breeding, Nutrition and Health

NDDB, in collaboration with various states continued its various Progeny

Testing Programmes to produce quality bulls of Holstein Friesian (HF), crossbred

HF and crossbred Jersey cattle as well as Mehsana and Murrah buffaloes for

production of quality semen needed for Artificial Insemination (AI)

programmes.NDDB-managed semen stations together produced about 135 lakh

doses of frozen semen during the year 2010-11. NDDB continued technical

support to Cooperative Cattle Feed Plants (CFPs). Some CFPs produced

feeds for high yielding animals and calf starter for young calves. The R& D

Laboratory of NDDB Hyderabad was setup to do research on animal diseases as

well as provided services to organized farms for animal diseases diagnosis and

for maintaining bio-security measures.

3.4.7 Quality Assurance

The Dairy Board, through suitable interventions, assisted dairy

cooperatives in improving conditions in dairy plants to ensure proper hygiene and

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food safety. Deployment of appropriate technology, which has an important role

in maintaining quality in the raw as well as market milk chain, was emphasised

upon. Cooperative dairy plants were also assisted in implementing food safety

and quality management systems, achieving energy efficient operation and

maintaining clean environment. The Dairy Board also coordinated efforts with

other stakeholders in the development process of appropriate food regulations

relevant to the dairy sector at national and international level.

3.5 NATIONAL DAIRY PLAN

To improve productivity of milch animals the Government and National

Dairy Development Board envisages implementation of the National Dairy Plan–I

(NDP-I) to meet the projected national demand of 150 million tonnes of milk by

2016-17 with assistance of the World Bank.

The objectives of the proposed scheme are: (a) To launch a focused

scientifically planned multi state initiative to lay the path for new processes,

supported by appropriate policy and regulatory measures leading to increasing

the productivity of milch animals and thereby increase milk production to meet

the rapidly growing demand for milk. (b) Provide rural milk producers with greater

access to the organised milk processing sector. The National Dairy Plan Phase-I

has been approved by the Cabinet Committee on Economic Affairs on 16-02-

2012. NDP-I is prepared to be implemented during the period 2011-12 to 2016-

17.

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Recently, the Government of India and World Bank sign US$352 Million

agreement for National Dairy Support Project. The project will cover some 40,000

villages across 14 major states and is expected to directly benefit around 1.7 million

rural milk producing households. The achievement of some of key Components of

Dairy Development in Different States under Cooperative Sector given in the

Annexure 8. The Annexure 9 shows the amount allotted and actual utilization of

allotted funds by Government of India during the various 5 year planning period.

It is evidence that the actual utilization of funds were under-utilized except during

1950-55 and 1985-90. The lowest utility was during the 9th plan period. It would

be properly utilized by the various State Governments, the dairy sector can

achieve spectacular growth even well before the target.

3.6 GROWTH OF DAIRY SECTOR IN TAMILNADU

The Dairy Development Department was established in 1958 in

Tamilnadu. The administrative and statutory control over all the milk cooperatives

in the State was transferred to the Dairy Development Department on 1.8.1965.

The Commissioner for Milk Production and Dairy Development was made as the

functional Registrar under the Tamilnadu Cooperative Societies Act. With the

adoption of 'Anand pattern' in the State of Tamilnadu, Tamilnadu Co-operative

Milk Producers' Federation Limited was registered in the State on 1st February

1981. The commercial activities of the Department such as Milk Procurement,

Processing, Chilling, Packing and sale of milk to the consumers etc., hitherto

dealt with by the Tamilnadu Dairy Development Corporation Ltd., were

transferred to the newly registered Tamilnadu Co-operative Milk Producers’

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Federation Limited, popularly known as “Aavin”.

In the wake of liberalization policy, private dairies have also entered into

the field of dairying. High priority has been given for improving the performance

of milk Co-operatives by adopting a systematic approach and proper strategy in

Milk Co-operatives. Significant achievement has been made by Milk Producers'

Cooperative Societies, Unions and Federation in the State of Tamil Nadu. The

cattle population in India is approximately 15% of total cattle population in the

world. India stood no. 1 position in milk production. Tamil Nadu is one of the

leading states in milk production. The milk production in Tamilnadu per day is

145.88 Lakh litres.

Tamil Nadu state has made a significant progress in the dairy sector and

occupies 8th position in milk production with 6.83 million tons during 20010-11

which is about 5.60% of the total milk production of the country. At present 17

district cooperative milk producers’ unions are functioning under TCMPF in the

Tamil Nadu State. With 9231 functional cooperatives societies and 22.26 lakh

primary members. However, only 4.19 lakh are pouring members. Currently

148.877 litres of milk is produced per day with a marketable surplus of 127.037

litres per day. Out of the total milk produced 8% of fluid milk is consumed in the

house-holds, 87% fluid milk is sold and 5% of milk is converted into products.

The percentage of share for cooperative sector was 19.86%, private organized

sector 14.64%, and for unorganized sector 65.50%. The average annual price

paid per litre to Dairy Cooperative Societies for cow milk (4% fat and 8.5% SNF)

was Rs.13.54 and Buffalo (6% fat and 9% SNF) was Rs.18.00 during 2007- 08.

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This price has been revised recently to Rs.15.54 for cow milk and Rs.23.00 for

Buffalo milk for all unions.

In Tamil Nadu number of functioning Dairy plants are 20 under

cooperative sector (16 union dairies and 4 federation dairies) and 33 private dairy

plants (See Table 3.1). The installed capacity is 29.42 LLD for cooperative dairy

plants and 34.79 LLD for private dairy plants. The current operating capacity of

cooperative plants are 25.30 LLD with average capacity utilization of 75%. The

number of operating milk chilling plants are 36 in cooperative sector with capacity

of chilling of 14.75 LLD. The cooperative milk union provides logistic support to

its members such as artificial insemination, health cover, cattle feed, fodder

seeds/slips and livestock insurance coverage, mineral mixture, emergency

veterinary service, milk testing, farmers training on animal management, clean

milk production, etc., Various schemes are being implemented such as crossbred

cattle and buffalo calves development programmes, establishment of bypass

protein supplement MSG units, PC based Automatic Milk Testing Laboratory,

providing milking machines, supply of mineral mixture supplement, supply of

chaff cutter, animal health cover – mobile unit, etc., to increase the milk

production and productivity of animals in Tamil Nadu.

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TABLE 3.1 IMPORTANT INFORMATION OF AAVIN DAIRY COOPERATIVES

S. No

Description Particulars

1. Total number of functional Milk Producers’ Coop. Societies.

9,231

2. New Milk Producers’ Co-operative Societies formed (2011-12)

1,460

3. Total No.of members in Milk Producers’ Cooperative Societies (In Lakh)

22.26

4. Total No. of pouring members (In lakh) 4.19

5. Milk Production by societies (In llpd) 24 to 29

6. No. of District Unions 17

7. State Level Federation 1

8. No. of Registered private Dairies in the State 42

9. Milk Procurement by Unions on an seasonal average (In llpd)

21 to 25

10. Milk marketing in Chennai City (In llpd) 10.57

11. Milk marketing in District Unions (In llpd) 9.78

12. Number of Union Dairies 16

13. No. of Federation Dairies 4

14. Handling Capacity of Union Dairies (In llpd) 20.72

15. Handling Capacity of Federation Dairies (In llpd) 10.00

16. Handling Capacity of Registered Private Dairies (In llpd ) 30.50

17. Number of Chilling Centres 36

18. Handling Capacity of Chilling Centres(In llpd) 14.75

19. Number of Bulk Milk Cooler Units 184

20. Handling Capacity of Bulk Milk Cooler units (In llpd) 7.33

21. Number of rural milk collection routes 528

22. Number of milk distribution routes at District level 230

23. Number of milk distribution routes Chennai Metro 107

24. Number of Powder plants (Erode, Salem, Madurai and Dharmapuri)

4

25. Capacity of powder plants for drying Milk 70MT/day

24 Number of Automatic Vending Machine Units in Chennai 189

Source: http//www/tn.gov.in and Dairy Development Department

3.6.1 Institutional Arrangements in Tamil Nadu for the Development of Dairy Cooperatives:

Institutional arrangements In Tamil Nadu, the activities of animal

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husbandry and dairy sectors are being looked after by mainly: 1. Department of

Animal Husbandry (DAH) 2. Tamil Nadu Livestock Development Agency

(TNLDA) 3. Tamil Nadu Cooperative Milk Producers Federation (TCMPF) 4.

Dairy Development Department (DDD) 5. Tamil Nadu Veterinary and Animal

Sciences University (TANUVAS) 6. Private Dairy and Poultry Integrators 7. Non

Governmental Organizations The DAH, TNLDA, DDD, TANUVAS are under the

control of Tamilnadu State Government and TCMPF is a cooperative setup.

Apart from these organizations, private Dairy integrators and Poultry (broiler and

layers) integrators and NGO and private organizations are involved in promoting

Livestock including poultry and dairy activities in the State. For overall

development of animal husbandry and dairy sectors in the State of Tamilnadu

there has to be a convergent, synergetic coordinated linkages between different

organizations for harmonious development.

The following observations have been made with regard to various

agencies involved in animal husbandry and dairy activities in Tamil Nadu: a)

Disjointed activities of similar nature noticed between various agencies. b) The

TNLDA, DAH, TCMPF, TANUVAS and private dairy are engaged in artificial

insemination workers, no uniform standard protocol is being followed with regard

to quality of semen, sire / damn capacity, etc. c) No uniform standards / duration

are followed for AI training of private workers d) Lack of synergy and coordination

leads to under utilization of infrastructure and repetition of same work / over

lapping of the similar work undertaken by different agency. e). Performance of

Central Sector Schemes NPCBD and Livestock insurance schemes are under

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implementation in the State.

More number of Bulk Milk Coolers (BMC) are to be installed. At present

184 BMC are available, another 300 BMC are required to maintain quality

standard of milk collected at production center at a cost of Rs.30 lakhs per BMC,

for 300 BMC the total requirement is Rs.90 crores. For milk pouring members of

TCMPF incentive mechanism could be worked out like insurance of cattle, supply

of feed, fodder, fodder seeds and mineral mixture at subsidized rate, individual

insurance and incentive per litre of milk produced to augment the supply to DCS,

so that the capacity of existing dairy plants could be utilized fully and increased

further in future. Buffalo calf rearing scheme can be extended to areas where

water facility or community ponds are available (Thanjavur, Trichy,

Nagapattinam, Thiruvarur, etc.,). Community ponds could be created utilizing

NREGA for wallowing of buffaloes. Value addition and improving shelf life of milk

(low cholesterol ghee, herbal ghee, Mango lassi, mozzarella cheese, milk based

sports beverage and flavored milk)

Out of total milk produced in the State 12% of milk is consumed at village

level by the Milk Producers. 49% of milk is handled by unorganized sector such

as local vending. The remaining 39% of milk is handled in the organized sector.

The share of the Cooperatives in the organized sector is 24 lakh litres to 29 lakh

litres per day. Measures are being taken to augment milk production and focus is

being given on improvement in productivity at grass root level.

The Milk Producers form the backbone for Dairy Industry. The extension

of inputs activities, supply of cattle feed and payment of remunerative price for

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milk are being provided to help the Milk Producers to enhance Milk Production.

The Government has given much importance for timely payment of milk cost to

the Producers. The Chief Minister of Tamil Nadu had given Rs. 115.85 Crore to

the Milk Producers, when the District Unions could not make payment to the

Producers in time. The District Unions are motivated to supply the required

quantity of cattle feed to the farmers, issue of loans to loyal members for

purchase of milch animals to increase milch animal strength and to form dairy

units. To accomplish these tasks and to serve the farmers community, the Dairy

Development Department is taking earnest efforts which now bring the desired

results.

3.6.2 Objectives of the Dairy Cooperative Department

The objectives of the department are:

1. To work towards remunerative price to the milk producers.

2. To improve input activities and animal health care for increasing milk

production.

3. To bring the un-organized dairy sector into organized sector in a phased

manner.

4. To monitor, supervise and regulate dairy activities.

5. To encourage liquid milk availability and supply of clean processed milk

following hygienic and food safety measures to the consumers at reasonable

price.

6. To ensure quality of milk and milk products as per the statutory specifications.

7. To ensure consistent growth of dairy sector in consonance with other industrial

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sectors.

8. To take ample efforts to ensure availability of feed and fodder to the dairy

animals.

9. To update and infuse technology in various dairy activities.

3.6.3 Strategies of Dairy Cooperative Department

1. Strengthening clean milk production activities at village level.

2. Strengthening and capacity expansion of Dairy Plants functioning under

Cooperative sector.

3. Enabling supply of clean and hygienic milk and milk products to consumers

and ensuring of food safety norms in Dairy Sector.

4. Providing free veterinary health cover, implementation of artificial insemination

programme, supply of balanced cattle feed, fodder cultivation and insurance

cover to animals owned by the milk producers in Cooperative sector.

5. Implementation of State Schemes, Central Government Schemes, Centre-

State shared Schemes and all sponsored Schemes for the growth of Dairy

Sector.

6. Computerization of dairy activities at various levels to ensure transparency.

3.6.4 Dairy Development Department - Department structure

The Dairy Development Department was established in the year 1958.

The Administrative and statutory control of all the Dairy Cooperatives in the State

was transferred to this Department on 01.08.1965. The Commissioner for Milk

Production and Dairy Development is the Head of the Department and officiates

as the Functional Registrar of Dairy Co-operatives and also functions as the

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Managing Director of the Tamil Nadu Co-operative Milk Producers’ Federation

Limited. Statutory functions such as Registration of new Societies, revival of

dormant Societies, inspection of societies, settlement of disputes, conduct of

election to the Boards of management, constitution of Boards, issue of direction

to Societies in the interest of public etc. are exercised by the Commissioner for

Milk Production and Dairy Development Department under the relevant

provisions of the Tamil Nadu Co-operative Societies Act, 1983 and Tamil Nadu

Co-operative Societies Rules, 1988. The Commissioner for Milk Production and

Dairy Development is assisted by Deputy Milk Commissioner (Co-operation) and

24 Deputy Registrars (Dairying) at the regional level for discharging the statutory

and Administrative functions.

3.6.5 Departmental Setup of Dairy Cooperative

The Commissioner for Milk Production and Dairy Development is the

Head of the Dairy Development Department. He is the functional registrar in

respect of Dairy Co-operatives in the State. He is also the Ex-officio Managing

Director of the Tamilnadu Cooperative Milk Producers' Federation Limited. i.e.

Aavin. The Commissioner for Milk Production and Dairy Development exercises

all the statutory powers with regard to the registration of societies, supervision,

inspection, inquiry, disputes, liquidation of milk cooperatives including the District

Cooperative Milk Producers' Unions and Federation under the relevant provisions

of the Tamilnadu Cooperative Societies Act, 1983 and Tamilnadu Cooperative

Societies Rules, 1988. While discharging the statutory functions, the

Commissioner for Milk Production and Dairy Development is assisted by the

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Deputy Milk Commissioner (Co-operation) in the rank of Joint Registrar of

Cooperative Societies and a Deputy Registrar at the Headquarters besides 23

Deputy Registrars (Dairying) at the District level by way of conferring the powers

of the functional Registrar. (See the Organization Exhibit I in Annexure 10)

3.6.6 Function of the Dairy Development Department

The main functions of the Dairy Development Department include

Organisation of societies, registration of societies, supervision and control of

primary milk cooperatives, District Cooperative Milk Producers Unions and

Tamilnadu Cooperative Milk Producers Federation. The Dairy Development

Department exercises statutory function - like Inquiry, Inspection, Surcharge and

Super session, appointment of special officers, liquidation and winding up of

dormant Societies etc. The Commissioner for Milk Production and Dairy

Development, Deputy Milk Commissioner (Co-operation), and Circle Deputy

Registrars (Dairying) are vested with quasi-Judicial powers in respect of

settlement of disputes, appeal, revision and review under various provisions of

Tamilnadu Cooperative Societies Act, 1983 & the Tamilnadu Cooperative

societies Rules, 1988 made there under.

The Commissioner for Milk Production and Dairy Development has been

designated as the State Registering Authority for the state of Tamilnadu, under

the provisions of Milk and Milk Products Order'92. All the Dairy units including

private Dairies handling more than 10,000 lpd of milk or Milk Products containing

milk solids in excess of 500 Metric tons per annum have to obtain registration

certificate under the provision of Milk and Milk Products Order'92. The

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Commissioner for Milk Production and Dairy Development / State Registering

Authority has been conferred with powers to register the dairy units having

handling capacity from 10,000 lpd to 2,00,000 lpd. The Commissioner / State

Registering Authority, Deputy Milk Commissioner (Co-operation) / District

collectors and Deputy Registrars (Dairying) have been authorized to carry out

supervision and periodic inspection of the dairies.

3.6.7 Tamil Nadu Cooperative Milk Producers’ Federation Limited

The Dairy Development Department was established in Tamil Nadu during

1958. The commercial activities of the Dairy Development Department were

handed over to the Tamil Nadu Dairy Development Corporation in July 1972,

which came under the control of Tamil Nadu Co-operative Milk Producers’

Federation in February, 1981. The Dairy Development Programmes are being

implemented through a network of co-operatives designed on the ‘Anand model'

of Gujarat State.

The institutional frame has a three-tier structure with the Primary Milk

Producers’ Cooperative Societies at the grass root (Village) level, Milk Producers’

Co-operative Union at the middle (District) level and Federation of District Co-

operative Milk Producers’ Union at the apex (State) level. The Organisation

Structure of Federation is given in the Exhibit 2 in Annexure 11.

3.6.7.1 Functions of Milk Federation (TCMPF)

The Tamilnadu Co-operative Milk Producers' Federation Limited is an

apex body of 17 District Cooperative Milk Producers' Unions. The Federation has

four dairy plants in Chennai, one at Ambattur with a capacity of 4.00 lakh litres

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per day, another at Madhavaram with a capacity of 2.00 lakh litres per day and

the third dairy at Sholinganallur with a capacity of 4.00 lakh litres per day. These

dairies collect milk from District Unions process and pack in sachets and send for

sale to the consumers in and around Chennai City. The fourth product dairy at

Ambattur is engaged in the manufacture of milk products such as Yogurt, ice

cream, Khova, Kulab jamoon, Buttermilk, Curd and Mysore pa.

The brand name of Dairy Cooperative is ‘aavin’. The Federation has 4

Dairy Units in Chennai which collect milk from District Unions, process and pack

in sachets and send for sale to consumers in and around Chennai City. Sale of

liquid milk in Chennai and Districts has increased steadily. Milk products of

'aavin' and Dairy Cooperatives are popular among the consumers in Tamil Nadu.

Ambattur Product Dairy is manufacturing milk products. (See Table 3. 2)

TABLE 3.2 FUNCTION OF METRO DAIRIES

Name of the Dairy Function Activity Capacity (In Litres Per Day)

Madhavaram Milk Processing 2,00,000

Ambattur Milk Processing 4,00,000

Sholinganallur Milk processing 4,00,000

Product Dairy, Ambattur

Milk Products 10,000

3.6.8 District Co-operative Milk Producers’ Unions

17 District Co-operative Milk Producers’ Unions are functioning in Tamil

Nadu. Primary Milk Co-operatives functioning in the area of operation are

affiliated to the concerned District Unions. The District Collectors of the Districts

where the Union is located are the Special Officers of the Unions in the place of

elected Boards. The Organisation Exhibit 3 of the District Cooperative Milk

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Producers Union Ltd is shown in Annexure 12.

The main activities of the unions are to procure milk from Primary

Societies, promote clean milk production, quality based milk cost payment,

supply of input services, animal health coverage, supply of feed and fodder,

implementation of State and Central Government schemes at District level,

conversion of surplus milk into skim milk powder and milk products, marketing of

liquid milk and milk products locally and through Metro Dairies.

3.6.8.1 Functions of District Cooperative Milk Producers Unions

Establishment of chilling centers.

Formation of new milk routes to collect milk produced by the

members of the societies.

Collection of milk from societies, process and pack in modern

dairy plants by maintaining quality standards.

Supply of quality milk to Chennai Metro under hygienic

conditions.

Fixation of procurement and selling price of milk.

Increase of liquid milk sales by introducing innovative sales

promotional activities.

Supply of inputs to the members of the societies.

Render Veterinary Health Service and emergency service to the

cattle of members of primaries, to impart training on First aid and

Artificial insemination to the staff of member societies.

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Extending Artificial insemination services to the cattle owned by

the members Milk Cooperative Societies.

Providing milk cans, Milk ‘O’ testers and LN2 containers.

Salem, Erode, Madurai and Dharmapuri Unions are the Feeder

Balancing Dairies. Surplus milk in the District Unions, after

meeting their local sales is diverted to the nearest Feeder

Balancing Dairies for conversion into milk products, such as

Skim Milk Powder, Butter and Ghee.

The three Cattle Feed Plants at Madhavaram, Erode and Kappalur are run by the

Kancheepuram - Tiruvallur Union, Erode Union, Madurai Union respectively. The

production capacity of these cattle feed plants is 100 MT per day each. The

balanced cattle feed produced in the form of pellets and mash are supplied to the

members of the Milk Co-operatives, livestock farms manned by the Animal

Husbandry Department and to various local bodies including the Corporation of

Chennai.

3.6.8.2 Milk Procurement by District Cooperative Milk Producers Union

Most of the rural people especially women make their livelihood by rearing

milch animals and by supplying milk to the Co-operatives. In the year 2004-05

the average milk procurement in District Cooperative Milk Producers Union was

20.56 Lakh litre per day and it was raised to 23.40 Lakh per day. The following

Table 3.3 briefs the average milk procurement in DCMPU.

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TABLE 3.3 AVERAGE MILK PROCUREMENT OF DCMPUs ( in LLD)

Year Lakh Liter per day

2004-2005 20.56

2005-2006 21.59

2006-2007 22.10

2007-2008 21.64

2008-2009 22.00

2009-2010 22.30

2010-2011 23.40

Source: Aavin Records

The union wise handling capacity is important in the management of dairy

cooperatives, the following table 3.4 gives the overall handling capacity of the

union.

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TABLE 3.4 UNION WISE HANDLING CAPACITY

S. No

Name of the Union Year of Commencement

Licensed Capacity (in LPD)

No. of Chilling Centres

1. Kancheepuram-Tiruvallur

1979 1, 10,000 2

2. Villupuram 1982 3,00,000 2

3. Vellore 1982 3,80,000 4

4. Dharmapuri 1982 2,50,000 2

5. Salem 1978 5,00,000 3

6. Erode 1975 4,50,000 3

7. Coimbatore 1979 2,50,000 4

8. The Niligiris 1978 50,000 1

9. Madurai 1982 2,00,000 1

10. Dindigul 1987 1,50,000 2

11. Tiruchirapalli 1980 3,30.000 3

12. Pudukkottai 1985 ------ -

13. Thanjavur 1982 50,000 1

14. Sivagangai 1982 74,000 2

15. Virudhunagar 1985 60,000 1

16. Tirunelveli 1982 1,00,000 4

17. Kanniyakumari 1982 20,000 0

Total 32,74,000 35

Source: Aavin Records

The chilling centre at Pudukkottai was closed as it could not be operated

with full capacity. The Pudukkottai Chilling Centre is being converted into a Dairy

with the financial assistance of Rs.2.99 crore from Intensive Dairy Development

Programme. On completion of the work the Dairy will start functioning.

3.6.9 Primary Dairy Cooperative Milk Societies

A minimum of 25 or more individuals competent to contract under section

11 of the Indian Contract Act of 1872, owning milch animals, can form a Primary

Dairy Cooperative Society, with one or more villages as its area of operation.

Such persons have to approach the Circle Deputy Registrar's (Dairying) office

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functioning at the District for further guidance. The members of Primary

Cooperative milk society have to supply milk to the Society which will procure

milk on quality basis and they will receive milk cost once in 10 days / 15 days

from the Society. Milch animals are provided with free veterinary health cover,

artificial insemination and the supply of balanced cattle feed. Inductions of

farmers on modern animal husbandry practices are aimed at by upgrading the

milch animals and thereby improving their productivity in the long run for the

benefit of the members.

At village level, a total number of 9,231 Milk Producers’ Co-operative

Societies are functioning in our State, which includes 1,491 Milk Producers’

Women Co-operative Societies. Apart from the above, 62 Milk Consumer Co-

operative Societies are also functioning in the State to cater to the need of the

milk consumers. There are 4.19 lakh milk producers now pouring milk to the

societies (See Table 3.5).

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TABLE 3.5 UNION WISE NUMBER OF SOCIETIES

AND POURING MEMBERS

S. No Name of the Union No. of Societies

No. of pouring

members

1. Kancheepuram-Tiruvallur 410 12,110

2. Villupuram 817 34,726

3. Vellore 1,130 91,341

4. Dharmapuri 611 25,779

5. Salem 1,262 48,695

6. Erode 738 38,470

7. Coimbatore 679 21,647

8. The Niligiris 95 4,609

9. Madurai 972 22,854

10. Dindigul 293 7,401

11. Tiruchirapalli 732 52,832

12. Pudukkottai 73 4,240

13. Thanjavur 253 20,513

14. Sivagangai 437 8,520

15. Virudhunagar 132 4,361

16. Tirunelveli 495 15,469

17. Kanniyakumari 102 5,480

9,231 4,19,047

Source: Aavin Records

The Producer Members of Dairy Co-operative Societies are paid dividend

for their share capital, bonus and patronage rebate when the society earns profit

and additional price for the quantity of milk poured. The Union wise Milk

Procurement (average per day) is given in the table 3.6.

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TABLE 3.6 UNION WISE MILK PROCUREMENT

(Average per day) S. No Name of the Union 2011-2012

(In litres)

1. Kancheepuram-Tiruvallur 56,000

2. Villupuram 1,52,000

3. Vellore 2,52,000

4. Dharmapuri 1,09,000

5. Salem 4,23,000

6. Erode 2,31,000

7. Coimbatore 2,30,000

8. The Niligiris 17,000

9. Madurai 1,68,000

10. Dindigul 40,000

11. Tiruchirapalli 2,94,000

12. Pudukkottai 14,000

13. Thanjavur 42,000

14. Sivagangai 33,000

15. Virudhunagar 12,000

16. Tirunelveli 58,000

17. Kanniyakumari 9,000

Total 21,40,000

Source: Aavin Records

3.7 ADMINISTRATION OF COOPERATIVE DAIRY IN TAMILNADU

Primary Milk Cooperative Societies and District cooperative Milk

Producers Unions and Federation were previously administered by elected

Boards. As the terms of office of the members of elected Board already expired

and as they were continuing only on extended term of office as per section

33(10)(aa) of Tamilnadu Cooperative Societies Act, 1983, the Government

issued orders terminating the extended term of office of members of Boards of

these societies and the Special Officers have been appointed under section

89(1) of Tamilnadu Cooperative Societies Act, 1983. All the primary Milk

Cooperative Societies are now functioning under the Control of Special Officers

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since 26.5.2001. In respect of District Cooperative Milk Producers Unions, the

Collectors of respective Districts have been appointed as Special Officers and for

Tamilnadu Cooperative Milk Producers Federation Ltd., the Managing Director of

the Federation has been appointed as Special Officer.

3.7.1 Quality Control Laboratory

Quality control laboratory is functioning under the control of the

Commissioner for Milk Production and Dairy Development (CMPDD) at

Madhavaram,Chennai. Samples of Milk and Milk Products are tested in the

laboratory to ensure supply of quality milk and milk products to consumers.Apart

from this, each Dairy is having internal quality control laboratory manned by

qualified personnel. These laboratories ensure quality of milk and milk products

at receipt and despatch points. A mobile quality control laboratory is also

functioning at Chennai. The quality control laboratory at Madhavaram is testing

milk products and acting as Research & Development Laboratory for introduction

of new milk products in the State.

3.7.2 Food Safety and Standards Act 2006 (FSA 2006)

Under Milk and Milk Products Regulation 1992, Commissioner for Milk

Production and Dairy Development was the State Registering Authority for Dairy

Sector, and had enforced the order and regulated the entire dairying activities in

the State. But with effect from 5.8.2011, FSA 2006 of Government of India has

come into force and Milk and Milk Products Regulation 1992 had been placed

under FSA and the Food Safety Commissioner is enforcing the Act regarding all

food items including milk and milk products. The Central and State Registering

authorities have registered diary plants under MMPR Act at 1992 are shown in

Annexure 13. In Tamil Nadu 21 private dairy sector are registered plants, there is

no cooperative sector registration.

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3.7.3 Efforts to Enhance Milk Production and Milk Producers’ Welfare

There are 4.19 lakh producers pouring milk to the Primary Milk Producers

Co-operative Societies. They are not only paid money for their milk poured but

also provided with services of animal health care, artificial insemination,

insurance, cattle feed and tie up arrangement for the purchase of milch animals

through various schemes.

During 2011-2012, the following producers' welfare measures were

provided. 1. 1,460 Primary Milk Cooperative Societies have been organized.

2. The Mineral Mixture production had been arranged from the plants located at

Erode, Tiruchirapalli, Villupuram and Tirunelveli District Cooperative Milk

producers’ Unions to feed the animals of milk producers.

3. 17.69 lakh frozen semen straws were produced at the ISO certified Nucleus

Jersey and Stud Farm at Udhagamandalam to provide quality Artificial

Insemination service.

4. In 2011-2012, a sum of Rs.10.21 crore has been paid to the members of

MPCS as patronage rebate, dividend and bonus.

5. Ensured maintenance of initial quality of milk by installing Bulk Milk Coolers.

6. Milk producers are being paid at the rate of Rs.20 per litre for cow milk and Rs.

28 per litre for buffalo milk.

3.7.4 Service to Milk Consumers

“AAVIN” is the most trusted brand in Tamil Nadu. Liquid milk and milk

products are sold under this brand.

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Three liquid milk dairies and one product dairy are functioning in Chennai

Metro. All these Metro Dairies are ISO (International Standards Organization)

and HACCP (Hazard Analysis and Critical Control Point) certified for ensuring

quality.

Metro Dairies have also obtained ISO 14001 certification for compliance of

environmental management system. In order to get feedback from consumers

and to redress their grievances a 24 hour ‘consumer care and support cell’ is

functioning at Nandanam, Corporate office. This cell is equipped with a Toll free

No. 18004253300 to contact round-the-clock. The milk requirement of the

customer is met through around 723 milk depots. 58 Milk Parlours are functioning

in the metro to cater the needs of the consumers.

3.7.5 Benefits to Milk Producers

In order to help 4.19 milk producers supplying milk to the societies, the

procurement price of cow milk was revised from Rs. 18.00 to Rs.20.00 per litre

and buffalo milk price was revised from Rs. 26.00 to Rs.28.00 per litre with effect

from 18.11.2011. Similarly, the selling price of toned milk was revised from Rs.

17.75 to Rs. 24.00 per litre for card holders. This price is still lower than

prevailing price in neighbouring States and Private brands.

3.7.6 Benefits Extended to Employees

There

are 1,979 employees working in Federation, 3,930 employees are working in 17

Unions and 19,823 employees are working in 9,231 Primary Dairy Cooperatives.

(See Exhibit 4 in Annexure 14) They are provided with the following benefits.

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1. Productivity Linked Incentives are being given to Federation and Union

employees.

2. The monthly pay of Primary Cooperative employees was enhanced by Rs. 200

per month with effect from 25.11.2011.

3. Bonus and ex-gratia are distributed to the employees of the Department,

Federation and Unions.

4. On the occasion of festivals, employees of the Dairy Co-operatives are

provided with gift packets containing milk products.

3.7.7 Door step Veterinary and emergency

Health Services

276 Mobile Veterinary Cluster Centres covering 9,231 Milk Producers’

Cooperative Societies functioning under District Milk Unions were identified. 121

cluster centres will be managed by the existing veterinarians and 155 cluster

centres will be managed by new veterinarians engaged under this Scheme.

3.7.8 Strengthening Infrastructure for Quality and Clean Milk Production

The objective of the scheme is to provide training to farmers on Clean Milk

Production activities, provision of chemicals and utensils, strengthening of

laboratories at District Union Dairies / Chilling Centres and installation of Bulk

Milk Coolers at societies to improve initial quality of milk at village level. The

components of farmers training, provision of antiseptic solutions and supply of

stainless steel utensils and modernization of quality control laboratories at

Dairies / Chilling Centres are sanctioned as 100% grant. 75% grant for

installation of Bulk Milk Coolers (BMC) and the remaining 25% is met by the

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concerned beneficiary District Unions.

The Scheme is implemented in Vellore, Villupuram, Tiruchirapalli,

Dharmapuri, Salem, Kancheepuram-Tiruvallur, Erode, The Nilgiris, Madurai,

Dindigul, Coimbatore, Tirunelveli and Sivagangai Milk Unions at the outlay of

Rs.23.42 Crores, of which the GOI grant is Rs.19.03 Crore and the beneficiary

Union share is Rs. 4.39 Crore.The GOI has so far released a sum of Rs.14.65

crore as grant.

3.7.9 Assistance to Co-operatives

The objective of the scheme is to wipe off cash loss in District Co-

operatives Milk Producers’ Unions and make them viable with suitable

Rehabilitation Plan. The Scheme is a shared scheme between State and GOI on

a 50: 50 sharing basis. In the year 2011-2012, GOI have sanctioned Rs.1.33

Crore to Dindigul Union, Rs. 7.60 Crore to Thanjavur Union and Rs.3.88 crore to

Kancheepuram Union.

3.7.10 Production, Sales and Marketing

The milk products of 'AAVIN' are popular among consumers. Products are

manufactured in Dairies of Federation and District Unions. The product range

includes Ghee, Butter, Skimmed Milk Powder, Badam Powder, Khova Tetra Pack

Milk , Dates khova , Paneer, Curd, Yoghurt, Butter Milk , Ice Cream, Gulab

Jamoon and Flavoured Milk etc., These products are being marketed through

Federation and Union parlours. The following table 3.7 and 3.8 gives the details

of the annual production and sales of milk and it dairy products.

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TABLE 3.7 ANNUAL PRODUCTION OF MILK PRODUCTS IN DCMPU

S. No

Name of the Union

SMP (In MTs)

Butter (In

MTs)

Ghee (In MTs)

Khova (In Kgs.)

Ice Cream

(In Ltrs.)

1 Villupuram - - 21 1,683 -

2 Vellore - - 155 11,600 5,764

3 Dharmapuri 451 546 327 12,299 -

4 Salem 1,505 1,955 159 24,200 -

5 Erode 3,215 1,966 468 72,000 -

6 Coimbatore - 7 114 22,397 -

7 The Nilgris - 23 23 5,120 3,970

8 Madurai 680 547 135 10,600 -

9 Dindigul - - 50 220 -

10 Tiruchy - - 180 7,000 -

11 Thanjavur - - 4 30,000 -

12 Pudukkottai - - - 300 -

13 Sivagangai - - 50 200 -

14 Virudhunagar - - 31 1,000 -

15 Tirunelvel - - 96 10,780 625

16 Kanniyakumari - - 3 60 -

17 Kancheepuram - - - 100 -

Total 5,851 5,074 1,816 2,09,559 10,359

Source: http//www.tn.gov.in

TABLE 3.8 MILK SALES IN CHENNAI AND DISTRICT UNIONS S. No Name of the Union 2011-2012 (In litres)

1. Kancheepuram-Tiruvallur 7,560

2. Villupuram 30,086

3. Vellore 87,847

4. Dharmapuri 21,690

5. Salem 1,76,854

6. Erode 79,371

7. Coimbatore 1,58,175

8. The Niligiris 16,543

9. Madurai 1,46,605

10. Dindigul 15,155

11. Tiruchirapalli 1,11,284

12. Pudukkottai 6,830

13. Thanjavur 19,529

14. Sivagangai 27,605

15. Virudhunagar 10,623

16. Tirunelveli 48,818

17. Kanniyakumari 13,825

Total 9,78,400

18. Chennai Metro Sales 10,57,000

Grand Total 20,35,400

Source: http//www.tn.gov.in

Page 95

3.8 Future Development of AAVIN

It is proposed to organise 1250 MPCS during XI plan period thereby

increasing the number of MPCS from 7800 to 9050 by covering untapped

revenue villages. It is estimated that 25 new private dairies may come up at the

end of the plan period. (See Table 3. 9)

3.8.1 Society infrastructure

To facilitate hygienic milk procurement, it is proposed, to provide buildings

to 300 MPCS at an estimated cost of Rs.1200 Lakh. To provide SS milk cans,

stainless steel milk collection kit, milk testing equipments, milking machines,

water softening unit, feed mixing units, computers etc., to 250 MPCS procuring

milk more than 1000 litre at a cost of Rs. 1250 Lakh. To install 300 Bulk milk

coolers at a total cost of 5625.00 Lakh. (See table 3.10)

TABLE 3.9 ORGANIZATION OF MPCS - PHYSICAL

S.No Item 2007-08 2008-09 2009-10 2010-11 2011-12 Total

A MPCS (In nos.) 250 250 250 250 250 1250

B. Private dairies (In nos.)

5 5 5 5 5 25

C Procurement by new MPCS (In LLPD)

0.55 0.50 0.50 0.50 0.50 2.55

Existing MPCS – Increase in procurement (In LLPD)

3.10 2.50 2.50 2.50 2.50 13.10

SUB TOTAL 3.65 3.00 3.00 3.00 3.00 15.65

E. Procurement by private dairies (In LLPD)

0.50 0.50 0.50 0.50 0.50 2.50

Source: http//www.tn.gov.in

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TABLE 3.10 SOCIETY INFRASTRUCTURE - PHYSICAL

S.No Item 2007-

08 2008-

09 2009-

10 2010-

11 2011-

12 Total

1 Stainless Steel Cans 5000 5000 5000 5000 5000 25000

2 Bulk Milk Coolers 60 60 60 60 60 300

3 Stainless Steel Kit 200 200 200 200 200 1000

4 Stainless Steel pail 4000 4000 4000 4000 4000 20000

5 Hygiene Kit 4000 4000 4000 4000 4000 20000

6 Electronic Milko Tester for DCS

200 200 200 200 200 1000

7 Automatic Milking Machine

4 4 4 4 4 20

8 Small scale feed mixing unit

50 50 50 50 50 250

9 Auto. milk collection. Station

30 30 30 30 30 150

Building 60 60 60 60 60 300

Source: http//www.tn.gov.in

3.8.2 TAMIL NADU STATE SCHEME (PART II)

For the development of infrastructure at grass root level, a sum of Rs.

113.91 lakh will be sanctioned for the year 2012-13 under Part II Scheme. Out of

this, Rs.15 lakh will be the institution share and the balance Rs.98.91 lakh will be

the Government share.

a. To supply milk cans to 250 Milk producers’ Cooperative Societies @

Rs.3,000/-per can a sum of Rs.30 lakh have been sanctioned for 1,000

stainless steel milk cans. Rs.15 lakh will be Government share and the

remaining Rs.15 lakh will be the beneficiary share.

b. For the use in the Office of Commissioner for Milk Production and Dairy

Development, one copier machine and one Fax machine will be

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purchased at a total cost of Rs.0.83 lakh.

c. 600 metre length protection wall to the orchard at Madhavaram Milk

Colony will be Constructed at a financial outlay of Rs.19.27 lakh.

d. One motor with accessories to the sanitary well at Commissioner for

Milk Production and Dairy Development campus, Madhavaram Milk

Colony will be provided at a financial outlay of Rs.2.50 lakh.

e. Providing Light Vehicle to the Deputy Registrar (Dairying) of Thanjavur,

Thiruvarur, Thiruvannamalai and Nagercoil at a financial outlay of

Rs.24.80 lakh will be provided.

3.8.3 Perspective Plan 2011-2016

In order to usher into a Second White Revolution in the State, the

following strategies are envisioned by the Department. Strengthening grass root

level infrastructure by forming 6000 Dairy Units in phased manner of 4 years

from 2011-2012 to 2014-2015. Under this, each year 1,500 Dairy Units will be

formed by engaging NGOs. Reorganizing the existing 121 veterinary routes and

to establish 276 mobile veterinary centres to cover 9231 MPCS. The veterinary

service will be provided to all the animals of members round the clock. Animal

Insurance will be done with TNLDA assistance. Input support will be provided to

producers for supply of balanced feed to their cattle. Green fodder cultivation will

be encouraged among producers. The chilling facility at villages and Dairy

handling capacities will be expanded to handle more milk. New product

manufacturing facilities will be created to sell milk products.

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3.9 TRICHY DISTRICT COOPERATIVE MILK PRODUCERS’ UNION LIMITED.

Tiruchi Milk Producers Cooperative Union was registered on 26.09.1980.

AAVIN, Tiruchi started functioning in a new premise on 09.06.1995. The Capacity

of AAVIN, Trichy is 1.50 Lakh Litre per day. The jurisdictions of operation are

Trichy, Karur, Perambalur, Ariyalur Districts. Additionaly the Puddukkottai district

is also under the control of AAVIN, Trichy. At the present the registered societies

with Tiruchi, AAVIN is 700 Milk Producers Cooperative Societies. 97 Milk

Producers Cooperative Societies are owned by women. The total number of

registered member is 2,10,125 as on March 2012. The number of members who

are selling to the societies are 49,193. Tiruchy Aavin procure 3,50,000 liters milk

per day. Out of which 1,20,000 liters sold in local area, 1,70,000 liters milk sent to

Chennai dairy and 60,000 liters milk sent to Erode dairy for making the Ghee,

Cream and milk powder. (Daily Thanthi 25-7-2012 p20.) The routes managed by

AAVIN, Trichy is 57.

Milk Chilling units are installed in Permbalur, Karur and Manaparai with

the capacity of 1,00,000 Litre, 80,000 Litre and 50,000 Litre respectively. Bulk

Milk Coolers with the capacity of 3000 Litres are installed in 4 location, and with

the capacity of 5000 Litres are installed in 13 location. An average of 5293 cases

is handled by the vetnary Doctors of Tiruchi, AAVIN. Medical facilities are

provided to the milch animal of the producers societies with the help of 8 doctors.

Artificial Insemination training was provided to the Milk Producers

Cooperative Society and at present 235 societies are providing these service.

During the year 2011-12, 8975 cows were artificially insemination and 243

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buffaloes were artificially inseminated. Under the scheme of STEP (Support to

Training and Employment Programme for Women) 20 Milk Producers

Cooperative Society are functioning. Around 1400 women are getting benefits

because of this programme.

The AAVIN, Trichy is disbursing Rs. 5.85 crores once in 10 days. Per day

the local sales of AAVIN, Trichy is 1,12,901 Litres per day. The milk send to the

federation is 1,66,870 Litres. The amount of milk send to Pudukkottai union is

6,182 Litres per day. The amount of milk send to Thanjavur union is 8,953 Litre

per day. The amount of milk send for the production of by-products is 27,451

Litre.

AAVIN, Trichy is selling its products with the support of 357 milk vendors,

28 milk selling shops, 5 wholesalers, 32 milk selling routes. The average

production of Ghee is 24 metric tonnes and Kova is 1 metric tonnes.

For administrative expenses spent by the AAVIN, Trichy during 2007-

2011is given in the table 3.11

TABLE 3.11 ADMINISTRATIVE EXPENSES

Year Amount (in Crores)

2007-08 5.22

2008-09 5.08

2009-10 5.14

2010-11 5.00

Source: Aavin Union Records It is evident that the Aavin union has spent the same

level of amount over the years and it is assumed that Aavin has not spent any

amount for the development infrastructure on computer applications and not

appoint either any computer professional or create a separate department for the

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supervision of REIL Implementation.

Table 3.12 gives the details of the milk procurement and sales of the

AAVIN, Tiruchy during the periods between 2003-04 and 2010-2011.This table

narrates that there is continuous increase of the Procurement and Sale of milk

and there is a wide opportunity for the Aavin Union to increase the sales and

procurement of milk in the future.

TABLE 3.12 MILK PROCUREMENT AND SALES (Litres)

Year Procurement Sales

2003-04 26,77,841 8,83,869

2004-05 32,60,537 9,37,261

2005-06 35,02,705 10,12,815

2006-07 35,74,653 11,38,738

2007-08 34,28,517 12,08,468

2008-09 33,49,272 12,61,984

2009-10 33,86,815 12,89,343

2010-11 33,01,560 13,30,565

Source: Aavin Union Records