Agro-industry sees threat passing

Farmers had lost of over Rs 1,100 crore due to unfounded fear of bird flu in Jan-Feb 2004

The emergence of the dreaded avian influenza (bird flu) among poultry birds in the Nandurbar district of Maharashtra may cause a major set-back to this fastest growing agro-industry but the threat may be only temporary, the industry feels.

In the shorter run, the production and consumption of poultry products are projected to drop and the prospects of capturing more export markets jeopardised. But nobody is yet willing to hazard a precise estimate of a possible loss to the poultry sector which last year churned out products worth Rs 30,000 crore.

In January-February 2004, poultry farmers had suffered a loss of over Rs 1,100 crore due to unfounded fear of bird flu. The loss to the entire poultry sector, including supportive services, was estimated at over Rs 3,000 crore.

"This time, since the bird flu has actually come, the damage may be more, if the menace is not nipped in the bud," feels Amit Sachdev, a leading poultry industry expert associated with Bluecross Consultants.

The reports of bird flu may also endanger poultry exports which had begun looking up of late as the country had till now remained free of this disease.

Exporters were expecting good business from Japan as deals were in advance stages of firming up. Japanese companies had already inspected and approved the products of several Indian poultry business houses.

But the fate of these deals could not be predicted now though many of these companies were situated in disease-free areas and were integrated units having full control over the entire production line, from grand parent breeding stock to contract broiler producers, Sachdev said.

Poultry Federation of India President Shashi Kapur is not too pessimistic about the impact of bird flu on poultry business as he expects the disease to be controlled and contained in its present habitat itself.

"The government is well prepared with a sound action plan for this purpose. Moreover, it has acted swiftly to check the spread of the infection," he told Business Standard.

But he regretted that a section of the poultry industry itself was trying to suppress information about it. "If the industry does not cooperate in containing the menace, we are in for big trouble," Kapur said.

He cited the example of Thailand, where the industry tried to suppress it but only to witness a full blown epidemic subsequently.

India's poultry industry has been growing at annual rates varying from eight to 15 per cent in the past few decades, making the country the world's fourth largest producer of eggs and fifth that of chicken broilers. With a turnover of nearly Rs 30,000 crore, this sector provides employment to over 5 million people.

Though the poultry sector accounts only for about one per cent of the country's total gross domestic product (GDP), its share in the livestock sector GDP is reckoned at over 10 per cent and is growing fast.

In fact, there are good prospects of this sector to grow even faster as the per capita consumption is still only 44 eggs about 1.76 kg poultry meat per year. This is far lower than the desirable level of 180 eggs and 11 kg poultry meat as recommended by the Nutritional Advisory Committee to the government.

However, both Kapur and Sachdev feel that the impact of bird flu on the poultry business, especially exports, can be minimised if certain suitable preventive measures are taken.

These include identifying zones that are totally free of the H5N1 avian flu infection and officially declaring them as disease-free. Of course, importers have to take a final decision on this issue.

Kapur wants the government to undertake selective vaccination of all backyard and village population of chickens around areas frequented by migratory birds.

"In fact, this should have been done earlier," he asserted. He also suggested that the government should give emergency licences to vaccine manufacturers to make enough vaccine available for this purpose.

For the present vaccination drive in a10-km radius around the focus of the bird flu attack in Maharashtra, Kapur felt the government had already imported adequate vaccine stocks from Intervet of Holland for this purpose.

However, the poultry industry is still unclear about the way the government would compensate poultry farmers for their losses due to mass slaughtering of chickens at risk in a three-km radius belt in the Nandurbar area.

They are also expecting government help through concessions on repayment of their loans and interest and raising of fresh finance to re-stock their poultry farms.

The overall cost the country may have to bear to control the bird flu is yet to be estimated. At a global level, bird flu containment measures are projected by the World Bank to cost between $1.2 billion and $ 1.5 billion.