The Milk Crises 2015 – Fracturing the backbone of the Indian Dairy Sector

Expand, grow, consolidate and let’s join the Big Boys! This is the mantra that Indian policy makers (politicians and their advisors) have been chanting. For over 20 years now they have been telling us that unbridled growth, urbanisation and deserting rural landscapes are the only way out of poverty. Reality on the ground: more malnutrition, unemployment, greater deprivation, violence, debt-ridden rural families, fractured education system, regressive governance. The latest casualty of this environment is the Indian Dairy Sector – a sector that was touted as the sunshine sector of the liberalised India.

While our mainstream news reporters and political spokespersons are distracting us with their ludicrous shenanigans there is a massive milk crises unfolding in the country. A crisis that is threatening to destroy (for the first time) the “resilient” people’s milk market. Today India is the world’s largest producer and consumer of milk and its backbone are the millions of small dairy farmers across the country. The domestic dairy sector even today is dominated by what is termed the “informal market” which is really the people’s market built by small farmers, milk vendors, cooperatives. A vibrant market built on experiential knowledge and resilient local cycles of production and consumption.

However as the Government’s chant of Bigger is Better grows more and more strident this resilient sector is facing a grave crisis. In May 2015, we at the Food Sovereignty Alliance were alerted to the crises by our member farmer sanghas from Chittoor in Andhra Pradesh and Medak in Telangana. As we tried to understand the depths of the crises it rapidly emerged that this is not just a crisis for small dairy farmers in A.P and Telangana but one that is engulfing farmers across the country.

Further research showed us that the crises was global! Small farmers in the EU, UK, US were suffering the same fate. The crux of the crises in India and globally is – the price at which milk is being procured by dairy processors from small farmers is much lower than the cost of production of one litre of milk. This is driving farmers deeper and deeper into debt.  This is in spite of the fact that farmers in the EU, UK and US have tremendous Government support. In India there is no safety net for these small farmers. Neither State nor the Central Government have taken any serious action to protect small farmer livelihoods since the onset of the crises.

In the UK and Europe mainstream media is highlighting this as a global dairy crises and some are even saying that “the crisis is too important to be left to the market.” To quote a recent piece from the Guardian “Being at the whim of the world’s commodity markets means a farmer in Cheshire is vulnerable to a fall in demand from China, and Russia’s ban on EU food imports in retaliation for Brussels-imposed sanctions”. This is going to be India’s reality very soon – a farmer in Chittoor is vulnerable to a fall in global skimmed milk prices triggered by China and Russia’s import bans or by Europe’s dumping of excess dairy products.

India’s dairy sector unlike that in the EU, UK and US was and is dominated by the “people’s market”. This made it resilient providing an assured source of livelihood for the small dairy farmers. As the Government aggressively tries to integrate the sector into the global market, lives and livelihoods of these small farmers are becoming increasingly vulnerable. If India continues on this course, small farmers will be destroyed. This is extremely serious given the agrarian distress that the country is facing. In a situation when livelihoods based on agriculture are becoming unpredictable, due to erratic weather patterns, dairying is the one hope for these small farmers.

In an effort to bring attention to this crisis and chalk out a strategy for a way forward, the Food Sovereignty Alliance convened a dialogue of farmers’ groups on October 21, 2015 at Chennai. Farmers’  Groups from Tamil Nadu, Karnataka, Andhra Pradesh, Telangana, representatives of the South Indian Coordination Committee of Farmers’ Movements and the Bharatiya Kisan Union participated in the dialogue. Details of the dialogue and proposed next actions are available at the Food Sovereignty Alliance’s blog.

This crisis is not one for the farmers alone. It is our crisis. All of us as global citizens must begin to ask ourselves at least a few questions – Where does our food come from? Are we drinking real milk? What goes into producing our food – vegetables, fruit, milk, meat, eggs, fish? Who makes it possible for us to eat? If we don’t then we will be party to the destruction of the lives and livelihoods of these small farmers and then where will our food come from?


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