Despite Surplus Milk, Govt Set To Import Additional 20,000 MT Milk Powder.

Union government has decided to import an additional 20,000 MT of milk powder to meet the growing shortage. This is in addition to the 30,000 MT sourced from international markets taking the total imports to 50,000 MT.

The government is importing 50,000 MT at a zero per cent duty against the standard 66 per cent which amounts to Rs100 per kilogram resulting in a duty loss to the tune of Rs 500 crore.

From February 18, 2011, the Government of India had issued an embargo on milk powder export and had resorted to import the same.

In this regard, the ministry of commerce issued a new notification No. 66 (RE-2010)/2009-2014 dated August 4, 2011, for an additional 20,000 MT.

Prior to this notification, in July 2011, New Delhi-based Sterling Agro had already offered to supply 10,000 MT via Letter No. SAIL/11-12/001, to Mother Dairy, an arm of National Dairy Development Board (NDDB).

Sources from leading dairies in the country stated that export of casein and milk powder to the tune of 70,000 tons was being carried out annually. Since the Government of India  export ban, domestic dairy sector is forced to sell the milk locally.

According to Kuldeep Saluja, MD, Sterling Agro Industries Ltd, despite the offer of 10,000 MT from October 2011 to March 2012, the Mother Dairy during a discussion insisted that the milk powder should contain 36 per cent protein as against the world standard for cow milk powder which is 34 per cent protein content.

“We  made efforts to point out to the government that it was importing skimmed milk powder (SMP) with 34 per cent protein and that it did not make any business sense to insist on 36 per cent protein which was a violation of the Indian Food Safety Act and International Codex which mandated  protein level 34 per cent,” added Saluja.

“Due to increased availability of cows’ milk in the north India region, dairy industry is keen to look at options to replenish the excess supply. But with such irrational moves by the government to import milk when there is an excess in the country, would  only lead to the death of the Indian diary industry in a country which is the largest milk producer, opined sources.

FnB News has earlier reported that India holds the leadership status as the highest milk producer globally with the production pegged at 112.540 million tonnes per annum in 2009-10 as against 94.5 MT per annum in 2004-05 registering a compounded annual growth rate of approximately 3.5 per cent p.a.
 
“Going by the milk glut in the country, when a single domestic supplier is in a position to supply 10000 tons, the government could have easily sourced the remaining 10,000 MT from other dairy cooperatives to meet the shortage of 20,000 MT rather than opting to import,” stated the industry sources.

Source : fnbnews.com