ASSOCHAM commends the Government’s plans for creation of a ‘Milk Grid’ in the SAARC region to overcome the inter-regional difference between supply and demand of milk. The grid aims to suitably link milk-surplus nations with deficit nations to improve efficiencies in the region. Under the South Asia Free Trade Area (SAFTA) agreement, the Indian Government plans to negotiate for a tariff under 5 percent which will boost the trade among SAARC countries.
SAARC countries like Bangladesh, Bhutan and Sri Lanka import milk and milk products to meet their domestic demand, while India holds the leadership position in milk production. With an annual production of approximately 140 million tonnes, India accounts for 17 percent of world milk production. ASSOCHAM firmly believes that the concept of a ‘Milk Grid’ needs a serious push so that millions of dairy farmers and milk processors in this region can have seamless trade across the countries. For establishment of a sustainable milk grid the following will play a crucial role:
•tReduction in tariff barriers under SAFTA can immensely boost trade in the region
•tStrengthening of milk production system through regional collaboration and forming an aggregate supply system through farmer-producer organizations
•tRevamping of dairy value chain through investments in cold chain infrastructure will enable faster movement and better quality of milk and value added products
•tRegional joint ventures in milk processing and value added dairy products will give a boost to the dairy economy and transfer of technology across the region
Currently most SAARC countries, including India, have milk in their sensitive list, on which concessional tariffs don’t apply. With the expected increase in per capita consumption in these countries, a strong milk grid is required to meet the future demand.
ASSOCHAM believes an accelerated effort towards establishment of the SAARC Milk Grid will contain inflation and usher in a ‘White Revolution’ in the region.