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Harish Damodaran

New Delhi , June 14

ONE may call it Round Two of the spat between the Gujarat Cooperative Milk Marketing Federation (GCMMF) and the National Dairy Development Board (NDDB) over the latter's policy to forge joint venture marketing companies with various State cooperative federations.

Round One had a clear winner: Dr Amrita Patel. The NDDB Chairman was not only able to convince the previous NDA Government the desirability of the joint venture experiment, but also win for herself a fresh five-year tenure. In the process, her erstwhile mentor and GCMMF Chairman, Dr Verghese Kurien, found himself totally isolated — a far cry from the time when his views carried decisive weight with the establishment.

But with a change of guard at the Centre, it seems that the dairyman from Anand is making a renewed attempt to argue his case. Late last week, the 82-year-old Dr Kurien was here, where he met the Prime Minister, Dr Manmohan Singh, the Food and Agriculture Minister, Mr Sharad Pawar, the Delhi Chief Minister, Ms Sheela Dikshit and also the Communist Party of India (Marxist) Politbureau member, Mr Prakash Karat.

"I got very positive signals from all of them. The Prime Minister said that he would support me fully and he made particular mention of the Operation Flood programmes that resulted in India becoming the world's leading milk producer by the mid-1990s", Dr Kurien told Business Line.

Significantly, Dr Patel was also present last week in Delhi, where she had meetings with Mr Pawar, Mr Karat and the former Deputy Prime Minister and current Leader of the Opposition, Mr L.K. Advani.

In his presentations, Dr Kurien re-iterated his familiar position with regard to NDDB setting up marketing joint ventures with individual dairy federations through a subsidiary, Mother Dairy Foods Ltd (MDFL). In the `Amul' model, the milk supplied by a farmer to a village cooperative society is processed by a district union dairy, which is then marketed by the federation.

In the new regime, the cooperatives will continue to be responsible for procurement and processing of milk. However, marketing would be handled by the concerned joint venture, in which MDFL will hold the majority 51 per cent stake. The federations would have to also transfer their brands to the joint venture.

According to Dr Kurien, the joint venture route reduces the farmer and his cooperatives to virtual contract suppliers. "Everybody knows that the cream lies in marketing and that is where the real money comes from. Here we have a situation where the cooperatives do all the hard work of collecting milk from lakhs of farmers and they are told to forego their rights over marketing and ownership of brands to a company, where they are a minority shareholder", he said.

Dr Kurien further alleged that the NDDB had very little marketing expertise to offer to the federations, considering that its `Dhara' edible oil brand had lost considerable market share in the last couple of years.

"The NDDB was created to finance and offer technical support to cooperatives and not to supplant them. I want a Joint Parliamentary Committee (JPC) to review its entire activities. Since NDDB was created by an Act of Parliament, let Parliament decide whether what it is doing is consistent with the objectives for which it was set up", he added.

Meanwhile, in what is seen as a victory of sorts for Dr Kurien, the Kerala Cooperative Milk Marketing Federation (Milma), on June 9, announced the termination of its joint venture with Mother Dairy on grounds that it had "not yielded desired results".

More Stories on : Dairy & Dairy Products | Trends | Alliances & Joint Ventures | Politics

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