ECONOMIC ANALYSIS

Module 7. Outlook of dairy industry

Lesson 32
DAIRY DEVELOPMENT AND OPERATION FLOOD PROGRAMME

32.1 Introduction

The purpose of operation flood (OF) programme is to replicate Anand pattern co-operatives throughout India. It was proposed that the state governments could use their own funds in their own way to develop dairying activities in their own way, but the additional funds available under operation flood was to be used for replacing Anand Pattern Co-operatives.

32.2 Formulation of Operation Flood Programme

By 1968, National Dairy Development Board (NDDB) had formulated first phase OF. This was aimed to capture commanding share of the milk market for public dairies in the four metropolitan cities of Bombay, Madras, Calcutta and Delhi. Modern processing dairies were to be established in rural areas with high milk fat for recombination. These modern processing dairies of rural areas (milk shed) were required to supply liquid milk to metro cities. The rural dairies also helped balance seasonal fluctuations in milk production through the separation of milk fat and other solids in the surplus seasons and their storage to be used in lean season.

NDDB was successful in obtaining Indian Government approval to accept the project and FAO-WFP (Food and Agricultural Organizations – World Food Programme) to fund it through a special mode wherein the WFP was to donate 42,000 tons of butter oil and 1.26 lakh tons of skimmed milk powder over a period of five years. These donated items were to be recombined and sold through the existing dairy system at current prices. It was envisaged that it will generate 954 million over the life of the project. The funds obtained through sale of commodities during the project was to be utilized for pursuing various of activities. Indian Dairy Corporative (IDC) was created in 1970 to handle the gifted commodities which was later on merged with NDDB.

Table 32.1 Operation flood at a glance

Table 32.2 Operation flood III : Physical targets and achievements

32.3 Impact of Operation Flood (OF)

1. Wide Coverage: After its inception in 1970, the OF programme was extended to 170 milk sheds, covering around 65, 469 dairy co-operatives with 8.4 million milk producers.

2. Production Capacity: The total handling capacity of all the rural dairy factories established under OF was 16.0 million liters of milk for day, milk powder manufacturing facility of nearly 786 tons per day.

3. Participation of Small Farmers:

The focus of Programme was on small farmers. From all the farm families covered under OF, 21 percent had no land, 66 percent were small and marginal farmers owing less than four hectares of land over 70 percent of families had only two milch animals or less, while only 10 percent of families owned more than two milch animals. Thus, looking to the coverage pattern of families which clearly indicate dominance of small milk producers, it can be said that of has been a development programme aimed at less privileged rural class for improving their socio economic status.

32.4 Objectives of OF

1. Managing milk procurement through economically viable village dairy co-operatives in the milk sheds at remunerative prices.

2. Providing good marketing of rurally produced milk and dairy products by

(a) Establishing rural dairy plants to process all the milk supplied by milk producers and ensure adequate supply of milk to consumers throughout the year.

(b) Facilitate regional and seasonal balance of milk supply and demand by developing a basic transportation and storage network.

(c) Increasing the capacities of city milk plants and establishing new plants.

3. Increasing the share of modern of dairies in the main urban milk markets.

In conclusion it would be best to characterize of as a targeted, focused, development programme. The target is to link milk production to its marketing through modern processing. The focus is on good potential milk sheds and farmers with relatively small production based.

References : From a Drop to a flood : An NDDB publication