Thai food conglomerate CP Group to invest in Uttar Pradesh agribusiness

UP eyeing Rs 50 billion investment in dairy, agro sectors

Thai agribusiness and food conglomerate CP Group is looking to invest in the poultry and cattle/animal feed segments in Uttar Pradesh.

Another leading agro company Fresco has evinced interest in the state dairy processing sector, UP principal secretary dairy and animal husbandry Sudhir M Bobde told Business Standard here.

“The agro-business companies including Cargill and CP Group are bullish on the North Indian states, including Uttar Pradesh, Rajasthan, Haryana and Punjab, especially in the feed business for cattle, fish and poultry,” he said.

“Based on the talks with companies and their proposals, we have projected total investment of almost Rs 50 billion in the dairy and feed segment by CP Foods, Fresco and others,” Bobde claimed.

Last year, Thailand Ambassador Chutintorn Gongsakdi had met UP chief minister Yogi Adityanath along with a Thai business delegation, including representatives of CP Group, to discuss investment opportunities, especially agro and food processing sectors.

Recently, another Thai business delegation had met UP industries minister Satish Mahana, who invited them to invest in other sectors as well including Buddhist tourism circuit.

CP Food is the subsidiary of CP Group, which is Thailand's largest multinational corporation with interests in agribusiness, food, retail and distribution. CP Food is the world's biggest producer of feed, shrimp and among global top poultry producers.

Meanwhile, the Adityanath government is also targetting to increase state dairy processing capacity in UP from the present 12% to 30% against the current national average of 17% and highest in Gujarat at 49%.

“Even if we are able to increase dairy processing capacity to 20%, it would mean fresh investment to the tune of Rs 60 billion. If we can achieve our target of 30%, it would bring an investment of Rs 150 billion in the UP dairy sector,” Bobde underlined.

Although UP has the country’s largest livestock population and is top dairy producer, it suffers from low yield. UP contributes 20 percent to the national milk production.

Over the years, Gujarat-based Amul has been expanding its retail and processing network in UP even as UP’s captive dairy brand Parag has lost market share and brand equity. Parag is the brand of UP Pradeshik Cooperative Dairy Federation, which was set up in 1962 to develop organised dairying on cooperative lines and protect farmers from milkmen.

Over the years, the UP dairy cooperative movement failed to provide remunerative prices to farmers due to inefficiency, corruption and politicisation.

Now, the Federation is planning to lease out its plants to other dairy majors including Amul and Mother Dairy on the condition that they source milk from the state cooperatives.

Meanwhile, the Federation also plans to establish 10 new milk processing plants and upgrade 4 obsolete units to quadruple milk processing capacity from 0.60 million litres to 2.5 million litres.