The Government has asked the Gujarat Cooperative Milk Marketing Federation (GCMMF), which owns the Amul brand, to submit a detailed proposal for taking over operations of loss-making Delhi Milk Scheme (DMS).

DMS, which comes under the Agriculture Ministry, has been running losses for the past several years. The Ministry had moved a Cabinet proposal for corporatisation of DMS.

“The Chairman of GCMMF has written to the Government proposing to take up the operation of DMS. However, GCMMF has been requested to submit a comprehensive and detailed proposal,” Agriculture Minister Sharad Pawar said in a written reply to the Lok Sabha.

The co-operative has to submit the proposal giving details of proposed valuation and monetisation of DMS, pending legal and liabilities, infusion of equity and terms of engagement of employees among others, he added.

Amul is keen on signing a long-term lease arrangement with DMS because it feels buying assets worth hundreds of crores of rupees would not be viable. It also thinks the issues related to employees need to be addressed, too.

Besides Amul, Bihar State Cooperative Milk Producers’ Federation (COMFED) that owns the Sudha brand had also showed interest in acquiring processing and distribution units of the DMS on rental basis.

The DMS has milk production and packaging capacity of five lakh litres a day, besides a network of 1,298 outlets in the NCR. The Government-owned dairy unit has 800 employees, but the milk production is only about 2.5 lakh litres a day.

(This article was published on November 27, 2012)
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