The Indo-US Dairy Saga

The US, trying to gain entry into India's growing dairy sector, has raised eyebrows about its impact on how well India farmers, especially the marginal ones, can handle the stiff competition. Though respite has been provided by the Indian government to protect the interests of the farmers, talks will resume between the US and India in the days to come. Strategic consolidation and more partnerships, quality branding, and private sector engagement to combat adulteration and elevate standards will help the Indian dairy sector to fight it out.

- Sanjiv Das

The current tariff scenario between India and the US is at its all-time low, thanks to a 50 per cent tariff being imposed on India by the latter. Though there is time in hand before the tariffs come into force, two major concerns are fuelling the India-US trade war, the most prominent being oil purchase from Russia by India, and the secondary being the US trying to enter the Indian market with its dairy products.

It can be noted that the Indian dairy sector is valued at around $227 billion and produces 25 per cent of the world's milk. Though talks between India and the US on whether the latter should be allowed to set up dairy shops in India has been going on for sometime, there has been jittery among the dairy community in India, especially the dairy farmers, who are worried about the outcomes.

Indian Prime Minister Narendra Modi tried to put all speculations behind. He announced that the Indian government is with the dairy farmers and will protect their interests even if it means paying a personal price for it.

On the other hand, the dairy products of the US remain a question for Indian consumers. India, being a religious sensitive country, the population is very wary of what it consumes.

Reports of the cows in the US being fed with pig blood, chicken poop, etc, have come to the fore. The milk from these cows raises concerns over animal feed practices. Under the US regulations, feeding cows with animal products is allowed in the country's regulatory practices.

The informal, decentralised dairy sector