The White Revolution

Written by Hafsa Ahsan • October 2009

Pakistan is the fourth largest milk producing country in the world and has a huge potential to grow and contribute to the economy. When one searches relevant material of the dairy farming and milk production in Pakistan, the only keywords which appear in the context are the “White Revolution.”

And this very aptly gives one an idea of the state of the milk industry in the country. It is indeed a White Revolution, as far as the production and revenue of this industry and its overall contribution to the economy of Pakistan is concerned.

A White Paper, published by the Dairy Pakistan Development Company, in collaboration with Nestle (Pakistan) Ltd and Tetra Pak (Pakistan) Ltd gives an interesting perspective on this industry. This 107-page report analyzes the potential of the dairy industry to become an engine of economic growth for Pakistan.

It also shares some interesting statistics with the readers. Pakistan is currently the fourth largest milk producing country in the world, behind India, China and the United States. The annual production is 33 billion litres of milk, which is worth Rs 177 billion.

Interestingly, 97% of this production is concentrated in what is known as the informal sector. This essentially means that the milk is produced by animals in the villages, and consumed both in the village and the cities. This is also called “open milk” or “fresh milk.” There is no branding or formal packaging here. But there are also no preservatives involved, hence the term “fresh milk.”

The report outlines the main problems with the current level of milk production in the country. Even though the production is massive, there is still a shortage of milk – four million litres in Karachi city alone. In 2007, it was reported that 25,000 tonnes of powder milk was being annually imported to meet the shortfall in supply, at a cost of over $300 million. Why is that happening?

One of the major reasons for this shortfall is that the farmers operate individually and have no formal means of storing and refrigerating the milk before it is transported to the urban areas. The delay results in wastage of milk as it is a highly perishable commodity and if not provided a cooling atmosphere, is more prone to contamination. Combine this factor with the warm climate of Pakistan and the problem becomes apparent. Milk has a shelf life of only four hours, if it is not properly refrigerated. This at least does explain the atrocious statistic of seven billion litres of milk that is actually documented to be wasted each year because of a lack of facilities.

Distribution poses another problem. Since this milk is “open” and not packaged properly, it is tampered with to a great extent. Firstly, it is exposed and hence, any amount of water can be added to it by the milk vendor. Also, there is no guarantee that the water being added to is clean and free of contamination. Secondly, ice slabs, caustic soda and sometimes formalin is also added to the milk to preserve it, which again poses health hazards.

Packaged milk by certain local companies as well as multinationals is seen as a constructive alternative. However, the milk that is packaged by them is UHT-treated, which adds to the cost of one pack, hence, not affordable for the masses.

The White Paper also mentions that there are eight million farming households in Pakistan and their overall herd of cattle totals 50 million. However, there are only two to five animals per household, while 97% of these farmers are basically operating on their own. This, combined with the lack of resources to join any formal milk packaging company adds to their woes.

Though the majority population of Pakistan depends on agriculture as its basic profession, the farmers face huge difficulties in handling their livestock. These are mostly linked to the lack of training of farmers. Livestock, for the most part, is handled in a traditional manner. Moreover, there is also a shortage of food and water, plus lack of adequate medical facilities for the animals. This means that even though the country has enough livestock, it has lower productivity. One estimate shows that Pakistan has three times the number of animals compared to Germany, but its yield is only one-fifth to that of Germany.

White Revolution is basically a series of policy initiatives which have been proposed to the government to formalise the milk industry in order to increase the production and revenue. These are being done on an official level by the Dairy Pakistan Development Company in Pakistan.

The policy measures include proper cooling and storage facilities for the milk, to ensure that milk is not wasted. It also stresses on the procedures for storing milk and efficient transportation to the urban areas.

Another measure is to increase the milk producing capacity of small farmers through proper training. This training would ensure that the farmers know the modern techniques of feeding the animals and getting them proper medical care, especially the vaccinations. This would in turn increase the yield of the cattle.

Other measures include the distribution of healthy milk, development of model commercial diary farms, and improvement of the breed of cattle. Instead of UHT treatment, pasteurization of milk has been suggested to make packaged milk more cost effective for the common man.

Improving the quality of milk produced will have two-fold advantages. While it will reduce the need for milk imports, it will also add to the exports. There is huge demand of both powdered and packed milk in Iran, United Arab Emirates, Saudi Arabia, Malaysia, and Philippines. There is no reason why Pakistan cannot export its milk to these countries, especially if it does produce world quality standard milk from the proposed commercial diary farms.

The White Revolution in Pakistan has set for itself certain targets to be met by the year 2015. It aims to increase the annual production of milk to 40 billion litres of milk. It is also aspiring to create a total of three million jobs in the formal economy and ensure approximately 350 million rupees per day in cash flow to the farmers. Whether it actually ends up meeting these ambitious targets remains to be seen. For now, one can only hope that these policy initiatives do benefit the small farmers as well as the general public - and that, as it has happened with many policies in the past, the benefits do not simply accrue to the multinationals.