Aavin needs autonomy to be competitive: NDDB chairman Meenesh Shah

One of the primary challenges Aavin faces is its lack of autonomy in pricing milk and milk products.
Meenesh Shah
Meenesh Shah

Aavin should be given autonomy in fixing price and other functions to compete with other dairy giants like Amul and Nandhini, said Meenesh Shah, Chairman, National Dairy Development Board. In an interaction with TNIE, he said TN milk cooperative federation should be free from government intervention, as is the case with Amul.

Tamil Nadu is known for its efficient administration in PDS, education, health, and other sectors. However, its dairy brand, Aavin, lags far behind industry leaders like Amul and Nandhini. Why is it so?

One of the primary challenges Aavin faces is its lack of autonomy in pricing milk and milk products. It’s an untenable situation to buy milk for Rs 50 and sell it for Rs 49. This lack of financial viability hampers Aavin’s growth in numerous ways. In contrast, Amul operates as an autonomous body free from government control, allowing it to thrive.

Amul procures nearly two crore litres of milk every day, while Nandhini (Karnataka’s dairy federation) collects 80 to 85 lakh litres. In comparison, Aavin’s daily procurement of 34 to 35 lakh litres only meets 17 to 18% of Tamil Nadu’s milk demand. How do you see Aavin’s future?

Despite challenges, Aavin has earned the trust of dairy farmers and holds immense potential to become a dairy giant akin to Amul or Nandhini. To realise this potential, every decision must prioritise the interests of dairy farmers, ensuring sustainable growth and competitiveness in the dairy industry.

Amul’s recent expansion into TN faced opposition from the state government. Amul offers a higher procurement price than Aavin. Where do you stand on this?

A similar issue emerged in Karnataka, but eventually subsided after the election. I have no information regarding the procurement price offered by Amul. We work for dairy farmers and recommend necessary policy changes to protect their interests.

Aavin has plans to increase its milk handling capacity by 10 lakh to 15 lakh litres per day in the coming years. Several projects are slated for funding by the NDDB. Could you shed some light on this?

The upgrade of Madhavaram Aavin dairy plant, which will double its capacity from 5 lakh to 10 lakh litres (with potential for further expansion to 15 LLPD), is set to be completed by May 2025. Additionally, new facilities, including a 6,000-litre ice cream plant and a 10,000-litre dairy unit in Tiruchy, and a one lakh-litre dairy plant in Thanjavur, are expected to be operational by July next year.

A hi-tech, modern dairy plant with a two lakh-litre processing capacity will also be established in Namakkal. Funds for the Namakkal project will be released once granted by the Department of Food Processing. Moreover, Rs 68 crore has already been allocated for various projects, including milk chilling centres and testing laboratories.

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