The Milk Route To Political Power

Long back, I met a Chinese expert, who was picking up tips from India to modernise his own country. He had concluded that there was only one thing we had done that China could not do-develop an indigenous dairy sector.

It's in that precious and unique area that a major storm is now brewing-a battle royale between the mother institution Amul, which had provided the template for and nurtured state-level milk cooperatives throughout the country and its most successful follower, the Karnataka Milk Federation, owner of the Nandini brand.

The rumblings that have surfaced during election season are an indication of significant economic, political and constitutional changes being pushed through by the ruling Bharatiya Janata Party-Rashtriya Swayamsevak Sangh (BJP-RSS), which will seriously impact several southern and western states.

The phenomenal success of the dairy sector is the result of a business model under which milk is directly bought from producers at collection centres by primary cooperatives through a simple quality control and pricing mechanism based on lactometers that measure fat content. The milk is then processed in chilling plants and dairies run by cooperative unions and district marketing societies and distributed throughout the State.

The relationship between Amul and state dairy cooperatives is that of promotion and support, not of rivalry or competition. Amul invented and perfected the model. It guided and watched over the replication of the system in several States.

The Nandini brand of the Karnataka Milk Federation (KMF) is Amul's most successful imitator with a wide coverage of dairy farmers and a host of products. The present dispute is not about sharing markets, as both brands are sold in each other's jurisdictions. It is far more insidious.

It’s an attempt to forcibly integrate KMF into a top-down multiState cooperative, controlled and run by the Central government.

Our wise Constitution makers have allotted cooperation exclusively to the State sector (entry 32). A small chink in the Central list to regulate multiState “corporations” which operate in more than one state (aimed at credit or consumer cooperatives of employees of countrywide companies, so that each branch need not be registered as a different State cooperative) led to the Multi-State Cooperatives Act in 2002.

The Central government is now driving a wedge into this tiny opening to create an overarching federation to break the monopoly of States without legal or constitutional authority on the specious plea that Indian dairy produce should make its mark in global markets and earn foreign exchange for the country.

The Amul-Nandini imbroglio is best understood if we look at chronology. Only one defiant group-the farmers-has forced the Modi government to retract hastily enacted policies. It was at the height of the fierce, protracted battle between farmers and the government, in July 2021, when the move was made to hand agriculture over to the usual favoured crony capitalists, by giving independent status to the Department of Cooperation, which had hitherto been an appendage of the Central Agriculture Department and entrusting it to the Home Minister.

This was a clever back-door manoeuvre to regain ground that was being lost to the farmers. The intention was to get a stranglehold on milk production, which is a major subsidiary source of farm income, successfully nurtured by dairy cooperatives that have been promoted and regulated by State governments.

By grabbing the sector from the hands of State governments, the Modi government hoped to push through its agricultural corporatization agenda through a different channel. It was also seeking other political advantages.

The Centre's ham handed attempt to meddle with a highly successful economic sector can be explained in two interrelated words: Power and Politics. States exercise significant power in the dairy sector by influencing the procurement price of milk for farmers and the sale price to consumers through representatives on the boards of cooperatives and subsidies to cover budgetary gaps.

This translates into widespread influence over farmers and the general public. It is this power that the Centre is now hoping to usurp. Cooperatives are also a synonym for politics-in its best and worst form.

Budding politicians take their first steps of participation in formal bodies and learn political lessons in primary cooperatives. Many leaders of western and southern India have worked their way up the political ladder by facing elections in cooperative institutions and running them.

Cooperatives are also hotbeds where financial and other deals are made and members sometimes exploited. This is the maelstrom which the Home Minister wishes to navigate.

We already know that the BJP’s mission is to subvert the federal structure of the constitution. In sectors like education, it is using Central government machinery to thrust its ideology beyond the few States which accept fundamental Hindutva to the many in which political life is governed by other concerns.

Now, it is proposing to do this in the cooperative sector, through one of its most economically successful branches, the dairy society, which is directly linked to farming communities and has nurtured political institutions and practices. The implications are huge for Karnataka and the rest of the country.

Like other southern states, political power in Karnataka has been based on caste not religious equations. The earliest Congress party heads came from two dominant castes-the Vokkaligas (meaning "farmers") mainly from the south and even more from the clannish Lingayats of the north.

A seismic change occurred in 1971 when Devaraj Urs united other castes and minority groups under the Indira Congress and brought them to the political centre-stage. Subsequent Congress governments shut out both the former dominant castes from power.

Vokkaliga leaders returned to the Congress fold over time, but Lingayats had no wish to dilute their earlier exclusive access to the levers of patronage. Naturally, every non-Congress combine, like the Congress (O) and its successor, the Janata party, became the natural habitat of some Vokkaliga political families (like the Deve Gowda dynasty) and almost all Lingayats.

The Lingayat faction was left in the lurch when the Janata party collapsed at the Centre. This is when it linked its lot with the BJP, which was struggling to establish a toehold in Karnataka from strongholds on the coastal fringe and Kodagu district. Meanwhile, the Vokkaliga section of the Janata party, led by the Deve Gowda family, turned itself into the JD (Secular).

Both groups roundly rejected the fundamentalism and Hindutva ideology of the BJP, although the JD (S) was more explicit. The Lingayats and the BJP have only entered into an opportunistic alliance so that they can together win enough seats to run the State.

Leaders like Yediyurappa are sincere when they show no interest in issues like the hijab or divisive Hindutva politics. Thus, in Karnataka, the BJP plays second fiddle to the Lingayats, without whom it cannot dream of controlling the Assembly. This is particularly galling now since it has gained power at the Centre.

If the levers of administration can be distorted to regulate the cooperative sector through the powerful dairy window, the deadlock can be broken. The BJP can then call the shots within the party in two ways.

It can break the close connection between the JD(S) and the farmer community of southern Karnataka, which is fostered by cooperative dairy societies. The party is well aware of the significance of this link and has put in enormous efforts to promote it by getting Deve Gowda’s elder son, Revanna, elected several times as Chairman of the Karnataka Milk Federation, while reserving the Chief Ministership for his younger brother, Kumaraswamy.

The power to fix milk prices and dole out subsidies is an effective political tool to influence election outcomes and make the JD(S) a powerful arbiter, when the Congress and the BJP fail to control the Assembly. So much so that the JD(S) has often become the pivot of a hung legislature and even seized the Chief Minister’s chair, without being either winner or runner up in the electoral contest.

The BJP is now aiming to take over this potent instrument and, by eliminating the JD(S)’s role of political middleman, coerce farm voters to submit to the diktats of its own High Command.

Amit Shah would also like to undercut Lingayat dominance within the Karnataka BJP. If Vokkaliga leaders and voters are sucked into his orbit, Lingayat power will wane. The central leadership could then push RSS ideologues, who have been waiting in the wings for decades, into the Chief Minister’s chair.

The edge of political superiority will then not only pass from the Congress to the BJP, but it will also go to a BJP run on the Hindutva principles, which are today shunned by Lingayats, who are swayed solely by caste loyalties. What is happening within the BJP in Karnataka is clearly “political federalism”, a stand-off between centralising religious fundamentalism and local casteist imperatives.

The tactic being tested out by Amit Shah through the milk route can drastically alter the functioning of Karnataka politics. As usual, in the pursuit of political objectives, the BJP has no qualms about undermining a successful, indigenous economic sector, which touches all rural lives and has been built by the participative effort of farming families over decades.

Eventually, he hopes to use the model in other States in which a broad based cooperative sector has brought economic prosperity and political power to the farming community. The NCP is as much a thorn in the side of the BJP in Maharashtra as the JD(S) is in Karnataka and will soon be on the same firing line. If Karnataka delivers as BJP hopes, can Maharashtra be far behind?

The nefarious efforts of the Central government must thus be resisted on several grounds. Because they will disrupt the working of a highly successful indigenous sector serving the large farming community, the only group that has effectively battled the BJP and its agenda of crony capitalism.

Because it will cut at the roots of the federal structure of the country. And also because it will destroy longstanding power equations founded on the grassroots participation of multitudes of farming families in rural areas.

It is fortuitous that the coming Karnataka Assembly elections have thrown up these issues and ignited a healthy debate on a devious plot with serious repercussions. Indians beyond Karnataka must also wake up to the economic and political perils of these milk-route manoeuvres and recognize how the letter and spirit of the constitution is being eroded.

Renuka Viswanathan retired from the Indian Administrative Service. The views expressed here are the writer’s own.