December 16, 1972

Rajmitra A. D. Amin Memorial Lecture Series

Rajmitra A. D. Amin Memorial Lecture Series
Indian Chemical Manufacturers’ Association
December 16, 1972



National Dairy Development Board
Anand – 388001



I am deeply honoured that the Indian Chemical Manufacturers’ Association has nvited me to give the fourth lecture in the Rajmitra B. D. Amin Memorial Lecture Series. The topic which I shall try to cover today is; “Dairying as an instrument of change.” I note that in addressing you here today, follow three distinguished predecessors, each of whom covered aspects of industrial development which may appear at first sight to be, so to speak, “closer to home” for people in the chemical industries than in dairying. However, I hope that this brief address will serve to show that dairying is closer to all our homes than it may previously have been thought to be, because it is, I believe, an instrument of change with significance for all of us – and not only of technical change, but also (and perhaps especially) of economic and social change.

I feel that it is particularly fitting that this subject should be taken up at this time in his series of lectures, which commemorates the memory of Shri Bhailalbhai Amin. e did so much to demonstrate how our people can, with determination, adapt and build upon the common approaches to modernisation, in order to set up the dynamic and viable industries which our country needs, to serve the interests of all our people.

In order to explore fully the potentiality of dairying as an instrument of change, it is best to look first into the practicabilities of the national dairy development t programme, which is popularly known as “Operation Flood.” But, before speak about “Operation Flood,” I feel I should put our dairy industry, as we conduct it, in its proper perspective before you. And I would quote as an example the Kaira Cooperative, of which I even today have the honour of being the General Manager.

In the Kaira Cooperative today, we have a membership of 185,000 farmers who with their families total one million people. Each farmer of these 185,000 produces 1 litre, 2 Iitres may be 5 litres a day. He owns one buffalo, two buffaloes or three
buffaloes; so we collect milk every morning and every evening from 185,000 people situated in an area of 2,500 square miles, located in about 710 villages.

You might consider this an impossible task: to collect milk twice a day in this manner, but we happen to be doing it. It has its problem undoubtedly, but I hope to indicate some of the advantages it may have also.

The total collection at the Kaira Cooperative’s plant at this moment is approximately 500,000 Iitres of milk daily. The average fat content of this milk is eight per cent because it is all buffalo milk. Now, before collecting the milk from these farmers, we had of course to form the organization that would achieve this
and our system is a cooperative one. We have in this area of 2,500 square miles, approximately 710 villages, as I mentioned, and in each village we have established a village milk producer cooperative. It is run by an elected managing committee of the farming members of that village. These 710 village cooperative
societies are federated in the Kaira district cooperative union, which owns the plant. The farmers in each village bring their milk to the village milk collecting centre where it is received, measured and tested for fat, and cash payment is made for the previous evening’s milk.

What this implies is that we do 185,000 fat tests every morning and every evening. We make 185,000 payments every morning and every evening. Some 85 trucks move the milk, according to a carefully made out schedule, from the villages to the plant and when it comes to the plant, it totals today approximately 500,000 litres. When we started in 1947-48 it was 500 litres. The rather large rural organisation that has .been inevitably built up, in the process of setting up the collecting arrangement, is also used to feed, back to the farmer the inputs he requires to increase his production. The first input is the cattlefeed. We have India’s largest cattlefeed plant in our system. We distribute approximately 250 tonnes of balanced
cattlefeed a day.

We then have a veterinary service; we guarantee our farmers that within four hours of being asked we will send a veterinarian to any farmer in this whole area, day or night. We maintain 39 graduate veterinarians, a larger number of stockmen
and veterinary dispensaries for this purpose. We treat approximately 200,000 cases every year.

The next input we provide is semen from selected bulls from our own artificial insemination centre. We have 70 bulls, who are the progeny of the best milk-producing buffaloes in the district, and their mothers have given as much as 20 litres of milk containing eight per cent fat. We do approximately 200,000 inseminations each year and this, too, is the largest number of inseminations done by any organisation in India. We also have extension schemes for increasing fodder production. We have our own agricultural department for this purpose and we also
have other technical inputs like newsletters, circulated to the farmers and dealing with better methods of animal husbandry. So altogether, the Kaira Cooperative Union has become a very large organization and the total value of milk and milk products sold per annum exceeds Rs. 30 crores. I have explained this only to set the stage for you to better appreciate what we mean by “Operation Flood.” Now I will speak about “Operation Flood” itself.

Today, India is going through her agricultural revolution. Despite temporary set-backs, food production in India is reaching levels at which all imports of food grains will stop. No one would have believed this was possible, even as short a while as four or five years ago, because India was so heavily dependent on imports of food grains from abroad. This has become possible because of the evolution that is asking place in agriculture, because we have moved in tractors, we have moved in better working management, because we have built enormous fertilizer factories, because we have pesticides, insecticides and because of modernization of agriculture generally.

There was no point in talking about quality of nutrition until there ‘was some reasonable quantity of nutrition. There was no point in talking about protein until there was enough rice to eat. We are now reaching the stage when we have the grains. It will become possible to spare a portion of our land’s produce for cattle. This then is the time when animal husbandry and dairies in particular can make a big impact in India. This is the time when “Operation Flood” becomes possible.

The big success in agriculture has brought with it a very serious problem; there are many problems but the most serious is the fact that we no longer need 75 per cent of our population to be engaged in producing the food of the nation. In America
I am told it is hardly 5 per cent of the population that produces the food. But in India it was 75 per cent. Thanks to the revolution we no longer need 75 per cent to be producing the food of the nation. Let us assume that we need only 65 per cent what will the other 10 per cent do? 10 per cent means 55 million people; that is, 11 million adults who need jobs. Normally one would assume that as an agricultural revolution proceeds there is also an industrial revolution and men released from the land will be absorbed by industry. But what an investment is needed to create 11 million jobs in industry? – an investment clearly far beyond our immediate capabilities.

What then shall we do with the 11 million surplus people on the farms who will migrate to cities looking for jobs? The resources of our cities are already overstrained, there won’t be housing, there won’t be water. So today is not only the time when we can make massive investments in animal husbandry, today is the time when we must make massive investments in animal husbandry because dairying as we practise it is highly labour intensive. An economic survey in some of Kaira’s villages has shown that, of the total income of the village, 50 per cent
comes from milk. Dairying can double the income of our farmer, our small farmer – and all our farms, with few exceptions, are small.

So this is the time when investment in dairying would to some extent, hopefully, arrest the drift of population from the rural areas to the cities.

A farmer and his wife can take care of the farm. The farmer takes care of the fields, he has 3 acres of land (that is the average farmer of Kaira) and his wife takes care of 1 or 2 buffaloes. The farmer gets his return from his crops when they are marketed once or twice a year; with it he buys his clothes, repairs his hut and looks after his plough – the annual expenditures- and his wife sells the milk and gets 2; 3, 4 or 5 rupees a day with which she buys the daily necessities for her
family, whether they be salt, sugar or kerosene. Dairying, therefore, as we practise it, supplements agriculture. The buffalo is fed the low grade surplus, the by-products of the farm, and milk is produced as a by-product. But the point is that it is no longer a by-product because 50 per cent of the income of the village is from milk.

One other point to be made, before going on to “Operation Flood” itself is: the investment in our factory, the Kaira Coop., which amounts to some Rs. 3 crores. Sales total over Rs. 30 crores. Where else, except in animal husbandry, can you get
this capital output ratio of 1:10 ?

So now we come to what is “Operation Flood”? I will take the example of a city like Bombay to illustrate “Operation Flood”. Bombay City has a population of approximately million people. The total market for milk in Bombay is 1 million litres at the present time. Out of this 1 million litres, when “Operation Flood” was conceived, the Bombay Milk Scheme (run by the State Government of Maharashtra) was distributing 400,000 litres a day as pasteurised bottled milk. The other 600,000 litres were produced by 100,000 buffaloes kept within the city limits. The Bombay Milk Scheme’s price was 1.70 rupees per litre for a full bottle of milk with 7 per cent fat.
This is for pasteurised bottled milk. The other 600,000 litres unpasteurised, unbottled, and frequently adulterated milk, was sold at Rupees 2.20 per litre, going up to Rupees 3.50 a litre during festivals and the dry season. The price and quality of the organised sector, the Bombay MIlk Scheme, did not influence the price and the quality of the unorganised sector because the organised sector had a minority of the market.. The only thing that happened was that, because the price was low and the
quality was good, the Scheme was under demand from the entire city, a demand that the Bombay Milk Scheme was unable to satisfy, because it couldn’t get the milk.

Faced with this situation, we looked at the 100,000 buffaloes kept in the city – they were kept in the most awful conditions, they were cesspools of dirt and filth and squalor in the city, all the cow dung was washed into the city drains, choking them,
the cow urine was washed into the ocean. There is not enough room for people to live, but there are 100,000 buffaloes living there. There were a lot of problems connected with keeping these city cattle, but let us look at points which are even more relevant to us. Each year, 100,000 buffaloes were brought into the city of Bombay as soon as they have calved in the rural hinterland and the distance over which they were brought may be as far away as the Punjab.

So cattle, as soon as they calve, are taken to the city along with their calves. Then the first thing they do to the buffalo which it reaches the city is to teach it to let down milk without the calf. This takes 15 days. No sooner has this been done than
the calf is allowed to die. Sometimes they help it to die. The calf mortality is 100 percent in 15-20 days from arrival in the city of Bombay. No cattle keeper in the city brings anything but the finest buffaloes from the rural areas, because under the adverse economic conditions of that city, the fodder and feeds also have
to be brought from the rural areas. Nothing but the most economic animal will produce enough money for the owner. So he goes to the rural areas and buys the finest buffalo and brings it along with its calf-and kills 100,000 calves (the
progeny of the finest buffaloes of India) in Bombay city alone each year. Then the buffalo becomes dry after 7-8 months. But she has not met a bull in Bombay. This is also intentional because, in the process of conceiving; I am informed that milk
production will fall slightly and therefore the cattle owners are not interested in letting these animals conceive. So at the end of the 8 or 9 months they become dry and they are not pregnant. What to do with such an animal in the city of Bombay? If it should meet a bull, you will have to wait 10 months before it will come into milk again and who is going to feed it for 10 months when it is producing no milk? So 50 per cent of the time they are sent to the slaughter house. There are enough people in our cities who eat meat. So 50 per cent, or 50,000 buffaloes, are killed at the slaughter houses in Bombay. The other 50 per cent who may be younger, are sent back to the rural area, 300-400 miles away, so they can be salvaged and produce milk
after having calved again. So Bombay City alone destroys 50,000 of the finest buffaloes of India each year.

Calcutta is no better. The people of Calcutta prefer cows’ milk : they have a liking for certain sweets which can best be made from cow’s milk. They have decimated the finest of the cow population in Punjab, by taking the cows from there along with the calf, killing the calf and ultimately making the cows dry; And these cows cannot he then killed-because under the laws of the land you cannot kill a useful cow; therefore they break its leg – now it is a useless cow – then they kill it.

What is the solution to this problem? This type of decimation of the finest of our cattle is what has brought Indian milk production and Indian animal husbandry to its present level, particularly when we have done nothing to remove the useless.
We seem to specialise in killing the best.

The National Dairy Development Board took stock of this situation and tried to find a solution. Two or three solutions have already been tried out but they have failed. The first solution was the famous Aarey Milk Colony. This is a milk colony which houses 15,000 animals and when it was built in 1950 there were 45,000 buffaloes in the city of Bombay. A milk colony, at the cost of Rs. 4.5 -crores, was built to house 15,000 animals in the most exquisite conditions. Having moved 15,000 buffaloes from the town, there should have been 30,000 left, but the mathematics went wrong-there are 100,000 left instead. More quickly than we could move the cattle, additional cattle came in. The cost of production in the milk colony was high, as one might expect. Therefore, under the protective umbrella of high price that the Aarey Colony type of production meant, the cattle owners could operate with the cattle coming in, being milked dry and, then killed, and so on.

The second solution was attempted by the Government of Gujarat, which watched with horror the decimation of its finest cattle-and so, not more than 17,500 cattle from the Kaira District are allowed to be exported each year by law. Not more than 45,000 from the neighbouring District of Mehsana will be permitted to be exported. And before .an animal can be exported a receipt must be produced to show that one dry animal has come back to the District. These laws were passed hoping that they would reduce the depletion of our finest breeding material. But the cattIe merchants just bought the cattle, walked them over the border, which is just a bridge over a river, and exported the cows from the neighbouring District. It didn’t

Punjab, whose entire cattle wealth has’ been seriously damaged by this practice, passed a law saying that no buffalo or cow can be exported until it has reached the age of eight. In making this law they thought the buffalo or cow would have produced two or three calves before reaching this age. The only difficulty was that it bred corruption in the sense that false papers stating the creature’s age were not very difficult to obtain and many people got false documents and exported the cattle.

All the Dairy Board said was that the problem we have been discussing was. really not an administrative one. It is not a legal problem. It is really a milk marketing problem and if you want to find. a solution to it, there is only one solution that will work – put milk in the city. Then cattle will not go to the city. And this is the. basis of “Operation Flood:”

Just for a moment imagine if the 100,000 buffaloes in Bombay by magic can be wished away to a rural area. How much milk would they produce there, and what about the fodder and feed that go into the city? The answer is, they will produce exactly the same, 600,000 litres. So in shifting the cattle you lose no milk. What would be the situation in the second year, if the rural area is not required to supply 50,000 freshly calved animals to replace the 50,000 that have been killed: then the answer is not 600,000 but 900;000 litres, provided you increase the fodder and feed available in the area to support the extra’ production. What about the’ third year? It was calculated that it will be anything up to 1.2 million Iitres. The fourth year, 1.5 million Iitres. Now the young females have come into milk, as it takes four years for a buffalo to come into milk. So we plotted this..assuming certain-mortality-rates and engaging the help of economists, and we found that the milk ‘production
in the rural area, starting with 600,000 litres a day, would rise to 3.3 million litres a day in the eighth year. There is, in fact, a tremendous multiplying factor involved in keeping the cattle in the rural area and not allowing them to be taken to the cities.
Taking milk to the cities on four legs is a most uneconomic and wasteful way of getting milk from the rural areas. Thus, having come to this concept, the title “Operation Flood” implied not flooding the cities with milk but a stop to the taking of cattle from the rural areas to the cities, so that a flood of milk will be
generated in the rural areas and flow from there into the cities, satisfying demands and needs more economically than taking cattle to the cities. But to shift the cattle, to dismantle these factories that produce milk – namely, these buffaloes – and
re-erect them, takes time and production must be kept going. Therefore we have asked the World Food Program of the United Nations for 42,000 tonnes of butter fat and 126,000 tonnes of skim milk powder, to be recombined into milk in our four cities of Bombay, Calcutta, Delhi and Madras, covering a population of 20 million people.

And while we put this milk in, we believe that what will happen is that the flow of cattle will be arrested, as we capture the milk market of Bombay for the organised sector. Capturing should be very easy, as we have a better product of reliable
quality at a lower price. So we will capture the market of Bombay for the organized sector with the milk we have, with the donations of milk powder and butter oil we will get, and having captured it there will be no cattle left in the city because
they will have no market to serve. “Operation Flood” is a marketing exercise and I think therein lies its strength, and therein lies also some of its problems.

Now the exact mechanism of the scheme is very simple. We receive these donations and in order to handle this scheme the Government of India has set up a Corporation, called the Indian Dairy Corporation. This Corporation, which is registered as a Company, will receive on behalf of Bombay, Delhi, Madras and Calcutta, butter oil and milk powder donated by the World Food Program. It will then give this butter oil and milk powder to the milk scheme in Bombay, Calcutta, Madras and New Delhi at a price at which the incentive to produce milk in the rural areas is maintained. And as we calculated that time if the world market price at the start of “Operation Flood” for these commodities was X, we would give them to these schemes at 2.5 X. Therefore 42 million dollars worth of these commodities which the World Food Program donates to us will generate 127 million dollars. The rest of it – say, Rs. 60 crores – constitutes a tax which we apply to mop up the consumer rupees for investment in rural animal husbandry. (I am told that economists call it anti-inflationary). Now this total of some Rs. 96 crores is used for building additional
processing and marketing capacities for milk in the cities, adequate to capture the total milk market.

The present capacity of the dairies in these four cities is I million Iitres a day. This is being extended to 2.75 million litres a day. This would take up approximately Rs. 40 crores. We are generating some Rs. 96 crores, so we invest the rest of that amount in creating replicas of the coop, at Anand in other States. In all these States, we shall endeavour to help them create a feeder balancing plant like Anand. A plant that will be sensitive to the needs of farmers, a plant that hopefully will be owned by them and certainly a plant that, apart from being sensitive to their needs, would be responsive to their demands. In “Operation Flood” the main problem is to create these farmer organizations to run these plants. It took us about 25 years to create Anand, we duplicated Anand in Mehsana, 100 miles to the North, and this took 10 years. We did a third organization in our neighbouring District, Baroda, and that took us four years. We built another in Surat, 100 miles South, which took us three years. Now we are creating ,two ‘hlorein Gujarat and we think
that will take up two years. ‘\Ve e m to be getting better as the years pass in building up these organizations, but I would admit that we have created these in the State of Gujarat, where Anand is in the centre and in other States it is not going to be so easy.

Think of the significance of these milk producers’ organizations. The Kaira Coop’, for example, organises 185,000 fat tests morning and evening in 710 villages. Based on these tests, the producers receive payment for their morning milk in the evening and for their evening milk next morning. Inevitably, to manage such a task, the coop’ has built up a considerable organisation of its own.

But, apart from the organisational capacity which is implied, think what it means in a village, when the people stand in line twice daily to sell their milk, they take their place in the queue, regardless of caste or traditional authority. The highest
may find himself following the humblest – and each knows that the coop’ (his own coop’) will treat them as equals and with fairness.

Moreover, each village coop is not only a milk collecting centre. It is a pucca building – often in a village which has no other such building – and it is washed down twice daily
after each milk collection. The measures used in collecting the milk are thoroughly scrubbed and insecticides are used to keep down the flies. Thus, each of the 710 coop’s is not only a milk collection centre – it may well also be the first example
of modern sanitation in its village.

Think also of the women who, in Kaira District keep the buffalo. Previously, when the buffalo fell seriously sick, they would tie a black thread on its left horn – and wait for it to die. Now their cooperative union has some 39 veterinary doctors- all of them employed by the farmers and paid by them. Within four hours, a mobile animal clinic – with a veterinary doctor – and an assistant – can answer a call for veterinary care from any of the 710 villages. Thus, the milk producers see the wonders of modern science (in this case, veterinary science) applied to their own needs.

Inevitably, curiosity is aroused in the villages as to the source of these modern benefits. Many of the milk producers may never have seen Anand, the Headquarters of their cooperative union, although it is not more than 40~50 miles away from their village. So we bring them to Anand. Some 100,000 women – all of them milk producer-members of the co-operative union – have so far been brought to Anand by the Union. They have a picnic and see the city – and most importantly, they see their own dairy plant, their cattle-feed plant and the artificial insemination centre, where some 50 bulls are kept to produce semen for the cooperative’s artificial
insemination system.

At the cattle-feed plant, we explain to them why the cattle feed has 16 per cent protein in winter, when other feedstuffs are available-and 19 per cent protein in summer, when quality feed – stuffs are in short supply. The technical staff at the cattle-feed plant also explain to them why it is necessary to give good feed
to the pregnant buffalo in the last three months of her pregnancy, even though she is not producing any milk, because it is necessary to see that the foetus receives adequate nutrition, in order that it will ultimately mature to its full genetic potential. When we explain these matters, are we talking of only animal nutrition?

Similarly, when they go to the artificial insemination centre, they are shown live semen under the microscope and they are told how artificial insemination actually works. But when we talk to them this way, are we only talking of artificial insemination for the buffalo – or are we not rather talking of the reproductive process itself and its control?

We should remember also that these milk producers are by no means confined to those with three acres of land or more. They include even widows with virtually no land and a family to feed. By applying her and her family’s labour to the task of
keeping one or two buffaloes, the widow is enabled to live. And this applies also to many who are today classified as “landless labourers”.

What, then, is the real significance this approach to dairying ? I t is an instrument of change in three ways :-

  1. It is a means whereby the villagers organise themselves for their betterment, building for themselves a means of creating the change that they want;
  2. It is an instrument which can benefit not only the “have’s” in the village, but also the “have not’s.” In fact, of course, the benefit which the sub-marginal farmer and landless labourer can obtain from dairying is proportionately greater, because they start from such a pitifully low basic income;
  3. And finally, perhaps most important of all, it is a means of demonstrating, within the village itself and even to its poorest members, what is meant by “modernisation”, what is meant by “science” – and how even the
    poorest villager can himself use these means of modernisation for bettering his own lot now and giving his family a hopeful future.

As I said, there are difficulties in helping the villages to create these organisations : there are vested interest who stand to benefit from the lack of change: a new approach is needed to the teaching of skills in the villages in order to make such. an organisation work – and above all, some extra resources have to be deployed, in order to make the sub-marginal farmer viable and to give the landless labourer a year-round means of living.

But, surely, this is what “development” is about. It is not a matter of Gross National Product – it is not even simply a matter of so many millions of litres of milk for our cities, important though that may be.

True development must be such that it brings the modernisation process to the service of our majority: namely the rural poor. It must bring to these people not only the pittance which they need for their humble diet, but also the means whereby
they can act together to obtain for themselves the benefits of modern science and organisation – and, in that process, the means whereby they can build for themselves, in every village; a society which is at peace with itself, concerned with its neighbours – and able to see a bright future for all its children.

Inits own way – and, I hope, in a humble way – dairying is such an instrument of change: an instrument not only of technical change, but also of economic and social change. And it is to such instruments that we must look to build the India of