NDDB slams GCMMF, calls for more transparency in co-ops

GCMMF refutes charge, questions changes in NDDB group

Certain notes in the annual report of National Dairy Development Board (NDDB) for the financial year 2003-04 have put the Gujarat Co-operative Milk Marketing Federation (GCMMF) in a quandary.

NDDB, which provides technical and financial support to promote the co-operative business model, has accused GCMMF of not maintaining transparency in its governance and management.

"Today, even after 30 years, India's largest dairy co-operative in Gujarat, with turnover of Rs 25,000 million, circulates neither the board agenda notes nor the minutes of meetings to its co-operative director members. Even by a liberal definition, many of today's dairy co-operatives in the country do fall well short of the definition, values and principles of co-operation," reads the NDDB annual report.

GCMMF is the apex marketing body of all milk co-operatives of Gujarat and its affiliated bodies in other states.

During the last financial year, NDDB amalgamated Bharat Aseptic Packaging Industry (BAPI) with another group company Indian Dairy Machinery Company (IDMC). Similarly, it merged Mother Dairy Delhi (MDDL) and Mother Dairy Foods (MDFL) with Mother Dairy India (MDIL) and Mother Dairy Foods and Vegetables (MDFVL), respectively.

"To successfully meet the challenges of a liberalised economy and attract professionals, dairy co-operatives which are emerging as big businesses need to evolve into new generation co-operatives by registering as 'Producer Companies" under the Companies Act," said Amrita Patel, chairperson of NDDB.

"The companies that were in operational in the similar areas have been merged to rationalise operations. This has been done by fulfilling mandatory procedures. As of today, the board has never acted beyond the NDDB Act, 1987. BAPI, that was taken over by NDDB for its printing infrastructure, has been merged with IDMC that is also into dairy processing and packaging. BAPI was defunct for last several years," an NDDB official said.

However, GCMMF is not happy with the changes made in the group companies.

"NDDB is a developmental funding agency. It is not their business to own and run companies. NDDB is using its granddaughter companies to promote joint ventures where state co-operatives have a minority stake resulting in no decision making power for the co-operatives," said a senior official at GCMMF. The chairman of GCMMF, Verghese Kurien was not reachable for comment.

The major group companies of NDDB, Dhara Vegetable Oil and Foods Company (DOFCO) closed year 2003-04 with turnover of Rs 283 crore. The turnover of IDMC during the year was Rs 46.50 crore.

At present, NDDB has investments of Rs 2,534 crore in form of loans and grants in dairy co-operatives. NDDB reported a surplus of Rs 101 crore during the last fiscal.