To meet India’s emerging demand for milk, production needs to increase at a rate of 6 million tonnes per year, which is double the earlier estimate of 3 million tonnes per year, according to N V Belavadi, executive director, National Dairy Development Board.
“If domestic supply does not cope with that rate of demand growth, we may need to depend on commercial imports as we did till the 1980s, and it may trigger a spurt in international prices,” he said.
Speaking at a workshop on dairy development in Andhra Pradesh, organised by the Federation of AP Chambers of Commerce and Industry (Fapcci) here on Friday, he warned, “New Zealand is lobbying for liberalising trade in milk products as part of a free trade agreement being negotiated with India. New Zealand is the only country that can compete with India in dairy.”
India’s milk production is 112 million tonnes per year, and has been growing around 3.7 percent in the last decade, according to Belavadi. With the rising rural incomes, urbanisation and limited export opportunities, domestic demand for milk has been growing much fas-ter than production, and is expected to exceed the Planning Commission’s estimate of 180 million tonnes a year by 2021-22.
“India has been the largest milk producer in the world since 1998. Milk production has improved because of the market impetus, but productivity per animal is still low,” Belavadi told the farmers and dairy sector entrepreneurs, calling for similar impetus for collection infrastructure.
He said the Rs 17,300-crore National Dairy Plan has been vetted by the Planning Commission, department of economic affairs and other government wings, and is aimed at enhancing milk production to 180 million tonnes per year by 2021-22.
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The first phase of the Plan will in all likelihood be implemented from October 1, he said.
The plan had been under negotiation for two years at various government depa-rtments as well as the World Bank. The latter has now approved funding for the first phase of the plan, which involves enhancing productivity in terms of milk per animal and strengthening village-level milk collection infrastructure.
The second phase of the plan is aimed at improving milk processing and marketing infrastructure and would need more funds. For this part of the plan, NDDB is in talks with the International Finance Corporation, private-sector funding arm of the World Bank.