100% FDI in the dairy sector is uncalled for, FIAPO writes to the Minister of Agriculture to review the decision

To,                                                                                                                                                                                                                 Dated : 7th July, 2016

Mr. Radha Mohan Singh

Minister of Agriculture

Government of India

New Delhi

Subject: Regarding prevention of intensification through FDI in the Indian dairy sector

Dear Sir,

We are writing on behalf of the Federation of Indian Animal Protection Organisations (FIAPO), India’s apex animal protection organisation. As the collective voice of the animal protection movement in India, FIAPO is the catalyst that protects the interests of animals on local and national levels – through education, research, lobbying, mobilization, training and direct action.  It has 70 members and over 200 supporter organizations across the country.

The recent decision of bringing FDI into the Indian dairy sector is a surprising highlight as the same was strongly opposed to by the NDA, when it was the main opposition party in 2011. What is even more surprising is the aim of bringing 100% FDI in the food processing sector. This is being done under the guise of reducing the wage gap between the rich and poor farmers. However, this can only be achieved by way of proper implementation of government based schemes as FDI cannot solely help in alleviation of poverty as seen in the case of countries in Africa and the Middle East.

Intensification of dairies as practiced by several multi-national companies only encourages use of cattle as factory machines and results in complete disregard of their welfare. This is a serious flaw as the process of intensification is based on an input- which is a live, sentient animal- and output as milk and milk products, which leads to exploitation of the animals in the process of meeting the challenges of the demand and supply chain. As intensification involves maximising cattle numbers in minimal infrastructural provisions, conditions that intensive farms create violate the Prevention of Cruelty to Animals Act, 1960.

The impact of FDI on small farmers:

It is also important to state here the direct effect this will have on small dairy farmers. Growth in milk production in India has outpaced the growth in other large milk producing countries such as the US and China. At present, the livestock sector contributes to 25 to 28% per cent of India’s GDP and the dairy sector comprises 65 to 70% share of the livestock sector. Milk procurement is an important source of secondary income for over 80-90 million milk producers, signifying its role to alleviate rural income and employment.

Nearly 80 per cent of India’s milk production is contributed by small and marginal farmers, with an average herd size of one to two milch animals. With the introduction of FDI in dairy, these farmers who are being termed as the “unorganised sector” will:

  1. Run out of business due to the resultant loss of income share as the international market fluctuates.
  2. Lose out on their profit percentage, as this move seems regressive because India is the largest producer of milk and the only country where the profit percent goes directly to the dairy owners with as much as 70% share. But this is not true for countries such as the USA or UK, who ironically fuel the FDI but the profit share of their dairy farmers is continuously decreasing and stands at just 38% and 36% respectively.
  3. Lose all forms of indigenous breeds of cattle which are more adaptable to the environment of our country and produce better quality of milk.

 FDI’s impact on animal welfare:

In addition to being disadvantageous to the small farmers, FDI will cause lowering the standards of animal welfare as in such establishments:

  1. Dairy cattle are continuously chained on short tethers in small mechanised stalls at all times, without being provided any time in open pastures.
  2. They are mainly fed concentrated grains as dry fodder, which induces severe stress on the metabolism of the animal.
  3.  Calves (especially males) are separated from mothers at birth and are weaned at 1 day old and sent directly for slaughter.
  4. The flooring of modern dairies is made of “easy to clean” material, which does not necessarily mean provision of having a comfortable foothold for the cattle. The floor is mainly made of cement or tiles which increases the chance of injuries due to slipping for the animals.
  5. Animal handlers employed at these dairies do not have any information about the basic physiology of the animal and are also unaware about maintaining basic standards of hygiene in the dairy.
  6. Increased use of artificial methods of impregnation in intensive dairies cause immense distress to the animals, which ultimately effects milk production and an increased rate of still births in subsequent pregnancies.

 How FDI in Dairy encourages violation of animal welfare laws:

There exist several national laws and guidelines to assist dairy owners in implementing the best and humane practices for milk production and animal care and laws that honour decisions in international business:

  1. The Prevention of Cruelty to Animals (Registration of Cattle Premises) Rules, 1978
  2. Prevention of Cruelty to Animals (Transport of Animal Amendment – 2009) Act, 1978
  3.  Food Safety Act, 2006
  4. Guidelines of the sub-scheme Special Programme for Dairy Development as a part of National Mission for Protein Supplements under Rashtriya Krishi Vikas Yojana (RKVY).
  5.  Government of India, Ministry of Agriculture and Department of Animal Husbandry advisory dated 2nd December, 2014 on use of antibiotics on food producing animals.
  6.  Technical guidelines to states for implementation of various components of centrally sponsored scheme “Livestock health and Disease Control” by the Ministry of Animal Husbandry, Dairying and Fisheries.
  7. Article 21:  Protection of life and personal liberty: No person shall be deprived of his life or personal liberty except according to procedure established by law.
  8. Article 51: Promotion of international peace and security: The State shall endeavour to:
    •  promote international peace and security;
    • maintain just and honourable relations between nations;
    • foster respect for international law and treaty arbitration obligations in the dealings of organised peoples with one another; and encourage settlement of international disputes.

These laws will be diluted and violated in the intensive environment of a mega- dairy wherein the cattle will be placed in mechanised stalls, devoid of any form of contact with other animals or calves and repeatedly impregnated by way of artificial insemination.


International precedence:

World over, there is a progressive shift from intensive farming of animals to a more humane method, prioritising the interest and welfare of animals.  Developed countries such as Australia, Canada and The U.K., to name a few, have devised Dairy Codes, wherein, guidelines for proper care and treatment of dairy cattle are listed.

 In Canada the National Farm Animal Care Council (NFACC) developed the Dairy Code of Practice which has been referenced to by several provinces of the country within their animal welfare provisions.

 The Australian Animal Welfare Strategy (AAWS) and the Animal Health Australia (AWS) together are developing a more humane Model Code of Practice for the Welfare of Animals as a result of a national and international demand for incorporating a shift towards improved animal protection measures.

In the UK, RSPCA welfare standards of dairy cattle are developed on the lines of the ‘Five Freedoms’ as defined by the FAWC. These are Freedom: from hunger and thirst, from discomfort, from pain, injury or disease, to express normal behaviour, from fear and distress. Farmers are required by law to have a thorough knowledge of the Defra ‘Code of Recommendations for The Welfare of Livestock: Cattle’.

All these countries have created Dairy Codes with reference to the aspects of housing infrastructure, food, slaughter, transport, health, management and environment. The animal farming sector in these countries has shifted from considering animals as machines to understanding the necessity of having physically and emotionally healthy animals for producing healthy food.

International dairy funding- a lost cause in disguise:

The funding of dairy sector through international corporate giants has caused several problems in developing and underdeveloped countries. Taking China for example:

  • The dairy sector in China was based on local and national subsidised plans for farmers. The rising demand for dairy products lead to an increase in adulteration of milk and a resultant shift from local production to internationally funded dairies which promised improved quality and quantity of milk.
  • These industries caused intensification to the extent of harming the soil, water and air quality of the country (farmed animals are responsible for releasing 18% of the total green house gas emissions) and ultimately leading to a decrease in the quality of the environment.
  • The foreign funding lead to occurrence of cases where international giants such as Danone, Mead Johnson, Nestle and Abbott, who held two- thirds of the total dairy share of the country between them, were implicated for a price- fixing scandal which the Chinese government eventually cracked down on.
  • In another example, Fonterra, which is a mega- dairy from New Zealand, established its dairy farm in Hangu, China in 2007. In 2008, the Chinese  milk  scandal erupted involving  milk  and infant  formula,  and  other  food  materials  and  components, adulterated with melamine. By November 2008, China reported an estimated 300,000 victims, with six infants dying from kidney stones and others reporting kidney damage, 860 babies were hospitalised. The chemical  appeared  to  have  been  added  to  the milk  to  cause  it  to  appear  to  have  higher protein  content.

Thus it is evident that intensifying dairies and bringing in foreign companies will not only cause a threat to human health but also reduce animal welfare, degrade the environment and introduce direct competition for indigenous cattle breeds. It will also cause political and economic losses with the multinational giants repeatedly demanding for reduced investment taxes and prices to help ease the process of doing business and possibly give rise to several untoward scandals.

As elaborated above, allowing mega inflow of FDI in the dairy sector opens the gates to unprecedented practice of cruelty to animals and destruction of small farmer livelihoods. Employment generation, which is the government’s stand to allow FDI only means the death of small dairy businesses. Thus, this system seems to be based on a foundation of misinformation about the plight of animals and injustice to small dairy owners. While the animals will be subject to a lifetime of suffering, the small dairy holders will permanently lose their livelihoods.

It is imperative that, before introducing FDI in the dairy sector at such a large scale, the Government should first regulate the existing structure through relevant policy reform, such as introduction and inclusion of FIAPO’s Dairy Code. Allowing multinational behemoths to invest in the dairy industry in the absence of such regulation will only wreak havoc in the lives of millions of animals.

In order to establish a better dairy structure in the country, we would like to collaborate with the Ministry and look for efficient methods of improving the condition of dairy animals with your help and assistance.

Thanking you.




Varda Mehrotra
Federation of Indian Animal Protection Organisations