I never thought of celebrating world milk day this year amidst high uproar over recent proposal by government restricting trade of cattle in India. Last fortnight saw two paradigm shifts happening in history of Indian dairy industry i.e imposition of differential GST tariffs on dairy products and government of India proposal to restrict trade of cattle in the country for certain purposes. There is nothing much to discuss this time except these two topics. So let us raise specific questions related to GST first, the same were being raised by me in my interview published with justfood.uk last week.
a. Is the product classification chosen under GST aligned with the one prescribed under FSSAI ?
b. Isn't the classification done under GST more subjective and brings in the discretionary element at all levels of tax considerations and this calls for clarifications at multiple levels by the stakeholders to understand it e.g Paneer without containers and brand are tax free and one in container and with brand with 5 % tax. It keeps the string open for Panir with brand and without container and Panir with containers without brand. However how could one carry panir without container ? Does ice box in which loose panir is carried doesn't come under container category.....However the list is endless.
c. The discretionary power of the taxman to consider certain market value for the product is a step to standardize prices of milk products through out the country... I have no answers to that.
Still it is too early and with time I hope and wish that the system will find better clarity around all these issues in consultation with the industry.
The second issue is much more serious and requires a national consensus before a decision is finally made.The proposed notification on cow trade has two elements and due to unknown reasons the better part of the notification is not much talked about.
The first part of proposal is for animal welfare and talks about around 30 areas wherein animal comfort is to be considered in terms of housing, water, feed, health, breeding etc. This initiative was taken up by World Animal Protection Society and they also produced a brilliant code on animal welfare in collaboration with NDRI.We at Suruchi Consultants co branded the collaterals for farmers with them along with our other dairy associates like DS Group under their CSR programs. However the implementation of code did not happen at mass level due to lack of any federal mandate backing it up. However now it could be made possible but prior to full implementation of animal welfare code at farmer level we need to answer the following three questions :
a. Does the farmer understand these codes ? Who will make farmer aware about these ?
b. Does the farmer has an intent of following this code ? What would motivate farmer to follow this code ?
c. Does following this code make his business sustainable or more profitable ? Is there any premium which he might be getting from its consumers if he keeps his cows happy ?
The second part of the proposed notification simply restricts trading of cattle for any other purpose than farming and trade is also required to be done between two farming entities only .
Since last few months on the same platform of Dairy Pulse we have been asking for a green corridor for transport of animals as well as a robust strategy and policy on scientific management of cattle or so called culling policy.
Whenever we have raised this issues at various forums in front of government representative the answer was that this is a state issue and center can not do anything without making certain constitutional amendment which I atleast do not understand as a simple dairyman. I also do not understand that how could we could make a business sustainable without defining an exit policy for factors making it unprofitable.
I was also surprised to read news in which it has been proposed to declare cow as a national animal. Atleast I do not have any problem in declaring Cow as a national animal but then declare Dairy Farming as a national Occupation also.
What I understand from anything being coined as a National collateral is that government would be responsible for its protection and sustaianbility.
Today a poor dairy farmer's livelihood is at a stake so declare his occupation as a national occupation and support him for all the losses as well as for all the cost which he has to incur on maintaining unproductive, old, male, sick dairy stock at his home.
By the way I am also interested to know whether the poor farmer who is the locus center of all these proposal has ever been taken into confidence before drafting and implementing such policies ?
It is high time for all of us to sit together and envision Indian dairy industry in these changing times , before it is too late.
Happy e reading !
Chief Thinking Officer
Suruchi Consultants (ISO 9001:2008 Company)