NDDB in 2004: Beyond Operation Flood

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The main challenge for dairy cooperatives is to hold their place and expand the space they have so far enjoyed in the market. Joint Ventures with NDDB will prepare state cooperatives to face increasing competition and also create an effective entry barrier for competitors.

Amrita Patel, chairperson, NDDB¹.

Introduction

The National Dairy Development Board (NDDB) was at the crossroads in 2004. Thanks to "Operation Flood", India, a milk deficit country in the early 1960s, become the largest producer of milk in the world by 1999. By the late 1990s, NDDB had brought 9 million small milk producers in 74,000 villages under the fold of the dairy cooperative movement, supplying hygienic and fair priced milk to almost 300 million consumers. NDDB had also extended the cooperative movement to edible oil and horticulture by organizing the producers into cooperatives based on the "Operation Flood"model. Despite the increased milk production, most of the state dairy milk federations were making losses.

To strengthen their marketing infrastructure and help them turn around, NDDB decided to form joint ventures with individual state dairy federations. In 2003, NDDB formed a joint venture with Kerala Co-operative milk marketing federation, which was popularly known as MILMA. The joint venture did not succeed and was called off in June 2004. Meanwhile, the decision to form these joint ventures had triggered off sharp differences between the leadership of Amul and NDDB...

Excerpts >>

1] Lakshman, Nandini. "Duel in Dairyland,"www.business-standard.com, 26th January 2003.

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