Research Forum: International Journal of Social Sciences; ISSN: (Volume-2, Issue-1) ISSN: (Volume-1, Issue-1) Abstract

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1 Role of Dairy Co-Operatives in Socio-Economic Development of Dairy Farmers in Moradabad District: A Case Study Nizamuddin Khan, Ashish Kumar Parashari, Mohd.Sadiq Salman Department of Geography, A. M. U. Aligarhy, India Abstract Dairy farming is an important activity of rural people in India. It has an important role in the sustenance of landless and poor people in the village economy. The government of India has started dairy co-operative societies to enable proper remuneration of milk and milk products to people. Dairy co-operative societies are joint ventures of the government and the local people for the daily collection of milk from dairy farmers. These co-operatives are not only an important channel for milk collection from grassroots level but also supply the collected milk to other parts of the state ensuring regular supply to the urban consumers.the present study analyzes the role of dairy co-operative societies in the socio-economic development of the dairy farmers. The study was conducted in Moradabad district. A village was selected for detailed study based upon primary field survey. The study shows than approximately 60 percent of the total production of milk is being transacted through the dairy cooperatives in the sampled village. This regular remunerations, necessary medical support and high demand of milk has resulted in socio-economic development of the people engaged in dairy farming. Thus the study reveals the vital role of dairy co-operative in marketing of milk and providing the necessary support for the dairy farmers leading to their socio-economic development. Keywords dairy farmers, dairy co-operatives, milk marketing, grassroots level, I. INTRODUCTION Majority of population in India lives in villages where agriculture is the main economic activity. The domestication animals have been an integral part of the farming system from immemorial time. Dairy farming is an important aspect of the rural economy of India. It is centuries old tradition for millions of Indian rural households (Khan N.et.al., 2011). The advent of Green revolution and other modern agricultural practices have declined the role of livestock in agriculture. Still, livestock is correlated with agriculture and social customs in India. The important role played by dairy farming in the sustenance of landless and poor people in the village economy is quiet evident (Pandey V.N. and Pathak A., 1997). Marketing of milk through organized sector involves government and cooperatives agencies while the unorganized sector involves the private organizations. Major part of milk is marketed through the unorganized sector and the organized sector has a very low share (Rjendran K. and Mohanty S., 2004). The government of India has started the operation flood programme for the proper enumeration of milk & milk products (George S., 1987). Further, various programs were undertaken for the formation of dairy co-operatives. The dairy cooperatives in India have three tier of structure which consists of state level federations, district milk unions and dairy cooperative societies at the village level respectively (Huria V.K. and Achaya K.T., 1980). As a result, dairy co-operative societies have been formed to meet local demand for milk & to eradicate the existing malpractices in the milk marketing. A substantial amount of money has been spent on the formation of dairy co-operatives to provide the infrastructure for dairy co-operatives. The evolution of dairy co-operatives has fuelled empowerment of rural people and promotes rural development (Bandhyopadhyay M.K, 1996). Uttar Pradesh is a leading state in terms of agricultural productions and dairy farming has a significant contribution to agricultural production. Dairy farming is increasingly more practiced by the small & marginal farmers because these farmers have very small land to fulfill their needs, so they domesticate animals (Bhaskaran S., 1996). Although dairy farming is not a specialized commercial activity in India but it provides regular income for the farmers throughout the year and has a significant role in generating employment for women (Manish S. and Tanaka H., 2007). Moradabad district is a major producer of milk in Uttar Pradesh and it has a very good network of co-operatives which provide necessary infrastructure for the growth of livestock and milk production in the district. The nearness to the national capital region has further enhanced the growth of milk marketing due to high demand. The present study was undertaken in a sampled village to understand the role of dairy co-operatives in the socio-economic development of dairy farmers at micro level in the study area. II. DATA COLLECTION AND METHODOLOGY The study is based on primary as well as secondary data. The primary data regarding people engaged in dairy farming, their socio-economic characteristics, process of milk marketing, economic benefits through milk marketing and other relevant data was collected through field survey. The data regarding milk collection centers and various milk processing units and co-operatives were obtained from the village pradhan (political head).stratified random sampling method was Sadiq Salman Page 1

2 used to select twenty percent households from each caste present in the village. Data was analyzed and finally presented through suitable tables, graphs and charts. Objectives The present study was undertaken with the following objectives- 1. To study the socio-economic profile of dairy farmers in the sampled village 2. To understand the process of marketing of milk through various channels. 3. To find out the role dairy co-operatives in the socio-economic development of the dairy farmers. III. STUDY AREA The Moradabad district lies between N to N latitude and 78 4 E to E longitude (figure 1). According to the 2011 census the population of Moradabad district is 4,773,138 persons. This gives it a ranking of 26 th largest district in terms of population in India. The district has a population density of 1,284 persons per square kilometer. The population growth rate over the last decade was 25.25per cent. The district possesses sex ratio of 903, and has a literacy rate of per cent. For administrative convenience the district is divided into six tehsils (Sub divisions) having thirteen developmental blocks. Moradabad lies in the gangetic plains and is an agriculturally developed district of Uttar Pradesh. The district posses a large livestock population with 11,78,319 headscomprising of various species. The share of Buffalo is largest (84.92 per cent) followed by Goat (17.54 per cent) and Cattle (17.49 per cent). The presence of sheep is quiet insignificant (0.05 per cent) in the district. The block wise distribution of major categories of livestock is shown in table 1. Sampled Village Figure 1: Moradabad District The district is a leading producer of milk and milk products in Uttar Pradesh. The large population of milch animals, increasing demand of milk and the vicinity of the National Capital Region (NCR) play an important role in dairy farming of the district. Therefore, dairy farming has emerged as an important economic activity in the rural areas of the district. This has resulted in a regular and good source of income to the dairy farmers, usually poor people.the Bahjoi block lies in south-west part of the district 58 kms. away from the Moradabad city. It has a population of 33,756 persons and has a literacy rate of 57 per cent during 2011.The major occupation is agriculture but a small proportion of population is engaged in secondary and tertiary activities. The total livestock present in the block are 70,098. They largest share is of Buffalo (57.99 per cent) followed by Goats (23.49 per cent) and Cattle (17.24 per cent). Sadiq Salman Page 2

3 Total Households Research Forum: International Journal of Social Table 1: Block wise Distribution of Livestock in MoradabadDistrict (2011) S. No. Block Cattle Buffalo Goat Sheep Total Livestock 1 Thakurdwara Dilari Chhajlet Asmauli Sambhal Pawansa BhatpurTanda Muradabaad Mundapandey Deengarpur Baniyakhera Bilari Bahjoi Total Rural Total Urban Total District (17.49) (64.92) (17.54) (0.05) (100.00) Source: Statistical magazine of Moradabad District, IV. SAMPLED VILLAGE FatehpurShamsoi village in Bahjoi block of Moradabad district was selected for the present study. It lies 8 kms away from the Chandausi town. The village has a good network of roads and is connected with nearby villages and towns. The village lies in the upper Ganga plain having very fertile soil.the total number of households in the village was reported to be 950 having a population of 8,000 persons.the main occupation of the people is agriculture. The village has an agrarian economy, well supported by dairy farming. The village has two government schools and three private Intermediate colleges which provide educational facility for the nearby villages also. There is a government health care centre providing basic health care facilities. V. DISCUSSION Socio-economic Profile of Dairy Farmers The village FatehpurShamsoi has 950 household. The field survey reveals a diverse caste structure of the village. Thus, the village is dominated by Brahmin (31.58 per cent) followed by Muslims (18.95 per cent) and Thakurs (14.74 per cent) as shown in figure 2. The variation in caste is due to historical and social factors. The dairy farming is highly influenced by the caste in the rural India. The households practicing dairy farming are not in the same proportion among the different castes. Caste Structure of Fatehpur Shamsoi (2012) Brahmin Muslim Thakur Maurya Jatav Harijan Others Figure 2: Caste Structure of Sampled Village Sadiq Salman Page 3

4 Caste Structure The field study reveals that among the total sampled households per cent households are engaged in dairy farming. Within these households the largest share is of Brahmans (36.30 per cent), followed by Muslims (17.04 per cent) and Thakurs (14.07 per cent).the caste wise distribution of sampled households and the households engaged in dairy farming in respective castes is shown in table 2. The proportion of households engaged in dairy farming is found to be smaller in households belonging to Maurya, Harijan and other castes. The share of dairy farmers among the different castes is variable due to various social, economic and cultural factors. Brahmins and Thakurs are more involved in dairy farming because major landholdings of the village are owned by them and they find it economical to feed their livestock from the fodder obtained from their fields. Further, the food habits of these castes involve more milk intake. Thus they find it more convenient to have livestock for regular supply of milk for household demand. S.No. Caste Table 2: Caste wise Total Sampled Households and Share of Dairy Farmers (2012) Total Sampled Total Households Practicing Households Dairy Farming Number Percentage Number Percentage 1 Brahmin Muslim Thakur Maurya Jatav Harijan Others Total Muslims also have large land holdings but they are generally involved in private collection and marketing of milk. The collection and marketing of milk is more tedious job but it gives a significant profit to the participants. Thus people involved in this process do not keep the livestock but make their profit by collecting the milk at lower rate from the dairy farmers in the village and selling them at higher rates to the nearby town, thereby getting the intermediate profit. Schedule caste groups have very small share of land holdings but they are engaged in dairy farming seasonally. The seasonal dairy farming by the scheduled castes is mainly on contract basis. They keep the livestock, take necessary care and feeding and sell the milk. The profit obtained by marketing of milk is divided within the owner and the care taker on the basis of agreement which is generally 50 per cent of the benefit.this process is referred as bataior adhiya in the local parlance. The huge cost of purchasing buffalo or cattle is a disincentive for the poor households to practice dairy farming without any financial support. Thus they generally keep small number of livestock in order to fulfill their daily household requirement. The small amount of surplus milk is also sold to get some additional income. Those who cannot afford to purchase any livestock they engage themselves in the seasonal rearing of livestock. The increasing cost of fodder and declining pasture land leads to decline in profits obtained from the livestock. The present scenario has resulted in the decline in the benefits obtained per livestock. Thus, households having large number of livestock get the real benefits of dairy farming while those having smaller number of livestock do not earn much profit. Livestock is an integral part of Indian culture. Dairy farming is practiced by a large proportion of Indian population for different purposes. The rural poor generally keep milch animals to supplement their agricultural income. They generally keep 1-2 animals for their daily needs and they sell the surplus milk in order to get daily income.some of the households depend entirely upon dairy farming for their sustenance. They practice the dairy farming on commercial basis. People having large landholdings also keep livestock but they generally use it to fulfill their personal household requirements. The social traditions and social values coupled with religious values encourage livestock husbandry in India. Age Structure The dairy farming is mainly practiced by people between 30 to 59 years (45.19per cent) followed by people between years (31.85 per cent). The least share of dairy farmers was found in the category of people having age of 60 and above (table 3). Age is an important factor in the dairy farming it is clear from the fact that young age people are engaged in the secondary and tertiary activities and mostly medium and high age groups are found engaged in dairy farming. The increase in social awareness and increasing educational level has led to change in the perception of younger generation. They consider agriculture and livestock husbandry as a low grade work and prefer to do some other type of work in the nearby towns and cities. Sadiq Salman Page 4

5 Table 3: Age Structure of Dairy farmers S. No. Age Structure Total Sampled Households Share in Total Dairy farmers 1 <14 years years years and Above Total Households Other Sources of Income Dairy farming gives small amount of benefit upon a single animal. Thus the dairy farmers have to generate other sources of income in order to fulfill their needs. The households engaged in livestock husbandry on commercial basis have larger stock of animals and get better returns. Dairy farming is practiced by different social groups and castes in the study area. It is practiced by the people engaged in different occupations like labouring, businessman, serviceman, farmers etc. (table 4). Farmers have the maximum percentage in dairy farming (60 per cent), followed by laborers (17.04 per cent) and servicemen (10.37 per cent). The reason is the availability of fodder from the fields and use of cow dung as manure which leads to saving of input cost in agriculture and livestock husbandry. S. No. Occupational Structure Table 4: Allied Occupation of Dairy farmers Total Sampled Households Share in Total Dairy farmers 1 Agriculture Labourers Serviceman Businessman Shopkeeper Total Source: Field Survey, 2012 Landholding Status Source: Field survey, 2012 Figure 3: Landholding Status of Dairy farmers The landholding status of the dairy farmers in the village as shown in the figure 3 indicates that the maximum dairy farmers in the sampled village have medium landholders (28.15 per cent) followed by marginal (23.70 per cent) and small (21.48 per cent) farmers. The share of landless people is 20 per cent. The present status of landholding of the dairy Sadiq Salman Page 5

6 farmers reveals that the possession of livestock in order to supplement their income is mainly undertaken by the landholders. The increasing cost of livestock and its rearing makes it difficult for landless people to purchase the livestock. They have to lend the money from the money lenders or other commission agents. Marketing Channel of Milk: Figure 4: Marketing Channel of Milk in Sampled Village The marketing of milk in the sampled village is a complex process. The dairy farmers generally transact the surplus milk through various channels (figure 4). The local demand at household level is generally very small and is fulfilled by the dairy farmers. The marketable surplus of the surplus milk is transacted for earning money.the major channels through which the milk moves up to the consumers at local and regional levels are: 1. Milkman: The milkman generally collects the milk from the dairy farmers regularly and gives the money at regular intervals. They generally give lesser remunerations than the cooperatives but the dairy farmers prefer them because they are ready to buy milk of low quality, having low content of fat and give money more frequently than the dairy cooperatives. Another reason for transacting milk through the milkman is that he himself visits the dairy farmers and they do not have to go anywhere to sell their mil The milkman supplies the milk to the nearby town, local collection centres or to the dairy cooperatives. The problem with this type of transaction is that the dairy farmer is bound to sell the milk to the milkman regular otherwise he does not collect the milk from the dairy farmers on regular basis. The milkman sometimes gives financial help to the poor households to buy livestock. This financial support is based upon a contract in which the dairy farmer feeds and takes regular care of the livestock and is bound to sell the milk to the milkman only. Further, the milkman buys the milk on his dictated price which is generally lesser than the usual rate. 2. Local Collection Centres: These centres collect the milk from various households and give a better price than the milkman. The dairy farmer is not bound to sell the milk daily to these centres. He is free to visit the local collection centre as per his convenience. The main problem in this type of transaction is that the dairy farmer has to take his milk to the local collection centre himself. The benefit of regular financial help from the milkman is not available in this type of marketing. The local collection centres generally supply the milk to the dairy cooperatives or the nearby towns. 3. Nearby Town: The dairy farmer sometimes visits the nearby Chandousi town in order to sell their surplus milk. This is only undertaken when there is a regular contract among the dairy farmer and the urban household consumer. Sometimes, the dairy farmer supplies milk to the sweet shops, hotels or for other commercial purposes on regular basis. The benefit in this type of transaction is security of regular payment and much better prices. 4. Dairy Cooperatives: The role of dairy cooperatives in procurement of milk and providing necessary services to the dairy farmers make them distinct among the other channels of milk marketing. The dairy farmers selling the milk to the dairy cooperatives get fair prices of their product. These centres also provide financial security and give the money to the dairy farmers at certain intervals. Thus the dairy farmers get a consolidated amount from the dairy Sadiq Salman Page 6

7 cooperatives. The major constraint with this channel is delay in payments by the dairy cooperatives. The poor households are unable to wait for longer periods to get the payments and thereby prefer to transact their marketable surplus through other channels. VI. MILK MARKETING THROUGH DAIRY CO-OPERATIVES The primary survey reveals that per cent milk is marketed through dairy co-operatives, per cent is purchased by the milkmen and 7.41per cent is procured through the milk collection centres (table 5). The share of milk transacted to nearby town is only 2.96 per cent. Dairy farmers in the village sell their milk to the co-operatives because they provide fair price along with other services. The milkmen also purchase a substantial amount of milk from dairy farmers because they provide money on daily basis and in advance also. These milkmen sell their milk in nearby towns on much higher price. The local collection centres are also a viable source for milk marketing in the sampled village. Table 5: Marketing of Milk through Various Channels S. No. Milk Marketing Channels No. of Households Share in Total Sampled Households (in %) 1 Dairy Co-operatives Milkman Collection Centres Nearby Town Total Table 6: Dairy Co-operatives in Sampled Village S.No. Name Years of Operation Volume of Milk Procured (Litres / day) Share in Total 1 Parag Dairy Ltd Shreeji Dairy Ltd Mother Dairy Ltd Madhusudhan Dairy Ltd Total 2, Total 4 dairy co-operatives are operating in the village which procure approximately 2820 liters of milk per day (table 6). The largest share is procured through Parag Dairy Ltd. (29.08per cent) followed by Mother Dairy (25.11per cent) and Shreeji Dairy Ltd.(24.89per cent). The Parag Dairy branch was established during the first phase of operation flood in 1977, since then it is operating successfully and providing facilities to the dairy farmers. During the last 4 years three more dairy cooperatives have been established in the village. VII.INCOME GENERATION THROUGH DAIRY FARMING Dairy farming plays an important role in employment generation and social development in the study area. The economic benefit from dairy farming is mainly obtained by selling the milk. The study reveals that 8.89 per cent households get an annual income of more than 2 lakh rupees whereas most of the households (45.19 per cent) obtain an annual income up to one lakh rupees whereas per cent households receive an annual income between 1-2 lakhs. The rest of the households having low income also obtain about 50,000 rupees annually. Table7: Annual Income of Dairy Farmers S. No. Annual Income (InRs.) Total Households Share in Total Dairy farmers 1 Low(<50,000) Medium(50,000-1,00,000) High (1,0000-2,00,000) Very High (> 2,00,000) Total Households Source: Field Survey, 2012 Sadiq Salman Page 7

8 The dairy co-operatives are important channel for marketing of milk because they provide the fair price and regular service. They help in the regular marketing of the milk, there is no gap and hurdle in the marketing of milk. Moreover, these co-operatives are the main source of regular income for the dairy farmers. These co-operatives give money on monthly basis, so dairy farmers receive a good amount of money monthly which can be utilized in other productive activities. These co-operatives also provide necessary veterinary care for improving the quality of livestock and increasing milk production. These co-operatives have helped in the emergence of true leadership, professional management and democratic functioning of milk marketing in the region. VIII. PROBLEMS AND PROSPECTS OF DAIRY COOPERATIVES Dairy farming is an integral component of Indian culture since ages. The people keep livestock for regular income and personal use. The marketing of milk provides an important share in the total income. The economic benefits from milk marketing lead to socio-economic development of the dairy farmers. A large number of dairy farmer depend upon the livestock for their livelihood. The sustenance of dairy farming is based upon efficient marketing of milk.the large number of intermediate agents lead to low remuneration of milk to the dairy farmers. Further, they collect the milk at their specified terms and price. In the present scenario the role of dairy co-operatives is quiet evident. They collect the milk from the people on regular basis and provide them fair prices as fixed by the government. This not only eliminates the exploitation of the people through various agents butencourage others to adopt livestock husbandry.these co-operatives have provided gainful employment for the dairy farmers and brought them close to the market. Modern technologies in breeding and feeding have been provided by these co-operatives. Technical inputs, animal insemination, balanced cattle feed, better fodder varieties etc. are ensuring the growth of livestock and better quality of life of dairy farmers. Although dairy co-operatives in the have been operating from many decades but the growth rate is slow. There is need to develop the infrastructure, quality, market linkages, professional assistance and transport facilities etc. These co-operatives are facing the problem of infrastructure, development of quality and lack of diffusion of new technologies. IX. CONCLUSION The growing demand of milk due to increasing population, increasing consciousness towards nutritive intake and commercial demand has lead to emergence of milk marketing through various channels in the country. The study reveals the importance of dairy cooperatives due to fair prices and fair marketing process in the sampled village.the largest share of milk is transacted through them.presently, involvement of women in the marketing of milk has taken place in the sampled village. Thus the dairy co-operatives have emerged as a source of employment generation, efficient milk marketing and socio-economic development of dairy farmers. Relevant policies and measures should be undertaken to ensure efficient milk marketing, better remuneration and sustainable socio-economic development of dairy farmers REFERENCES [1] Bandhyopadhyay M.K (1996) Dairy Co-operative and Rural Development (With Special Reference to Comparative Study Between the Kaira District Co-operatve Milk Producers Union Limited and the Himalayan Co-operatve Milk Producers Union Limited), Finance India, Vol. X No. 2, June pp: [2] Bhaskaran S. (1996) Culture s Consequences: Dairy Market Opportunities in India, Marketing Bulletin, July, pp: [3] George S.(1987) Stemming Operation Flood: Towards an Alternative Dairy Policy for India, Economic and Political Weekly, Vol. 22 No 39 Sept., pp : [4] Huria V.K. and Achaya K.T.(1980) Dairy Development in India: Some Critical Issues, Economical and Political Weekly, Vol 15 No 4 5/46,November, pp: [5] Khan N., Salman M.S. and Rehman A. (2011) Livestock Husbandry in Rural Urban Fringe of Aligarh Town: Environmental Sustainability, Advanced Journal of Geographic World, Vol.1, No.2, pp [6] Manish S. and Tanaka H.(2007) The Impact of Dairy Co-operatvies on Women Empowerment- A Case of Kishan Dairy Co-operatve in West Bengal, India, SabaragamuwaUnivesity Journal, Vol 17 No. 1, pp: [7] Pandey V.N. and Pathak A. (1997) Peasants, Subsistence and the Dairy Co-operatve in Dry Land: A Fragile Existence, Vol 32 No 39 Sept. 1997, pp: A98-A105 [8] Rjendran K. and Mohanty S.(2004) Dairy Co-operatives and Milk Marketing in India: Constraints and Opportunities, Journal of Food Distribution Research, Vol. 35 No 2, July, pp: Sadiq Salman Page 8