Political meddling to financial impropriety – it is all going wrong at Amul

out today, the second — and concluding — part of our report on how Kaira Union, the Amul Dairy set up by Verghese Kurien and Tirbhuvandas Patel is doing.

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Amul federation could be soured by corruption charges against its oldest cooperative in Gujarat

On March 31, K Rathnam abruptly resigned as managing director of the Kaira Union, the oldest of the 18 cooperatives that market their products under the Amul brand name.

The announcement came shortly after some board members of the union, including vice chairman Rajendrasinh Parmar, alleged a Rs 450-crore scam during Rathnam’s three-year stint running the cooperative.

For their part, Rathnam and Ramsinh Parmar, the long-standing chairman of the Kaira Union, said the resignation was a routine matter. Rathnam, 55, told The Indian Express, “I have given Amul 22 years of my life. Now, I wish to spend time with my family that is settled in Tamil Nadu and America.” Both said talk of corruption was politically motivated.

Two weeks later, as public attention has gradually moved away, the contradiction between these claims and counter claims has not been discussed much in the media. In the process, urgent questions about the functioning not just of the Kaira Union but also the Gujarat Cooperative Milk Marketing Federation, which coordinates the Amul cooperatives, are slipping under the radar.

Part two of the report, out tomorrow.

The Amul story: How politics is hurting the economics of Gujarat’s milk cooperatives

In the winter of 2013, the inner workings of Amul briefly became public. A boardroom putsch was underway. The directors of no less than 14 of the 17 district milk cooperatives that were then part of the Gujarat Cooperative Milk Marketing Federation, which owns the Amul brand, had turned against chairman Vipul Chaudhary. A member of the Bharatiya Janata Party, Chaudhary was part of the Shanker Singh Vaghela-faction that had branched out as a separate party in 1996 and formed a shortlived government with Congress support. Chaudhary had since then returned to the BJP, but in 2013, others in the Amul federation suspected him of cosying up to the United Progressive Alliance government at the Centre. This cost him the support of BJP-controlled district milk cooperatives, news reports said.

In the course of the power struggle, serious accusations of financial impropriety surfaced against Chaudhary, who was also the chairman of the milk cooperative at Mehsana. Board members charged him with selling 7,000 tonnes of milk powder at low rates to private buyers, resulting in losses for the Mehsana dairy. It was also alleged that Chaudhary had created excess manufacturing capacities without taking permission from the federation. This had led to a higher interest and depreciation burden, resulting in huge losses, alleged RS Sodhi, the managing director of the federation.

But with public attention focused elsewhere – the 2014 national election was already creating headlines – Amul’s boardroom battle did not get the attention it deserved. In January 2014, the dissidents won. Chaudhary was removed. Amul found itself a new chairman and vice-chairman. A curtain dropped on its functioning all over again.

This year, in August, the curtain parted briefly when Ramsinh Parmar, the MLA from Thasra constituency, left the Congress to join the BJP. Parmar wasn’t just one more MLA deserting the Congress before state assembly elections. As the chairman of the Kaira milk cooperative, he was the last standing non-BJP chairman in the federation.

How palm oil from Malaysia fired the Patel agitation in Gujarat

Dhirubhai is in dire straits. He can no longer recover his investments on the groundnuts he grows on three acres of land along the Junagadh-Verawal road in Gujarat.

In a good year, he grows 100 kilos of groundnuts – or peanuts – for every Rs 4,000 he invests. The minimum support price – or the price at which the government buys the crop – is Rs 4,400. But the middle-aged farmer said government officials buy only from “vyapari aur mota rajkarmi” (traders and big farmers). Smaller farmers like him sell to private oil mills at very low rates. Last year, he got just Rs 3,500 for every 100 kilos of groundnuts – lower than both his investment and the minimum support price.

Blame it on rising edible oil imports — especially palm oil. And therein hangs a story. Do read.

Can the courts save India’s rivers from pollution? Tirupur shows the answer is no

the second — and concluding — part of our trip down the Noyyal (see previous post).

A slum sprawled on one side of the river. In the distance, a factory belched smoke in the air. The riverbed was overrun with weeds and crammed with plastic bags that were half buried into the earth. An earthmover scooped gunk from an open drain and dumped it on top of the debris. The river itself was a thin trickle of black.

Welcome to Tirupur, an industrial city in central Tamil Nadu, where India’s judicial system tried – and failed – to save a river.

The Noyyal is a small river which starts in the western ghats and flows 170 kilometres to merge into the Cauvery. It passes through Tirupur, where factories have been emptying out effluents in its waters ever since a textile hub came up in the 1970s.

After the state failed to protect the river, in 1996, the Supreme Court intervened. It ordered dyeing units in Tirupur to shut down if they could not stop polluting the river. Fifteen years later, in 2011, the Madras High Court followed up by applying the “Polluter Pays” principle, directing the dyeing factories to become zero discharge units by recycling waste water and pumping it back for reuse.

Since then, the larger units in Tirupur have set up their own effluent treatment plants. The smaller ones have come together to set up Common Effluent Treatment Plants. In all, 18 CETPs are operating here.

But the river still does not look clean.

The first part of this series flagged how the state administration in Tamil Nadu has been unable to protect the Noyyal. That story traced the river’s journey from its source till Coimbatore.

This story looks at what happens to the Noyyal after it leaves Comibatore, and why even judicial remedies to protect the river have failed.

How a river in Tamil Nadu turned into a sewage canal

A narrow little rivulet splashes down, bouncing from boulder to boulder as it descends the rockface. It pauses to catch its breath in a tiny pool limned by trees, before rushing downhill again, merging with other streams to form a small river called the Noyyal.

For centuries, the river’s 170-km course used to take it past the farms, forests and villages of Tamil Nadu, before sinking it into the embrace of the great Cauvery.

In recent decades, this landscape has changed.

Noyyal’s basin – the area drained by the river and its tributaries – has become one of the densest urban landscapes in the state. The cities of Coimbatore and Tirupur, which are located here, are now among India’s leading industrial clusters. The basin has seen an exponential rise in population. Between 1991 and 2011, the number of people living here doubled from 19.5 lakhs to 42 lakhs. With more people settling in the cities, the urban population mushroomed from 9 lakhs to 33 lakhs. Such a large number of people moved to the cities that the rural population actually fell.

Spikes in population, urbanisation and industrial activity bring with them questions of sustainability.

At Kovai Kutralam in Kachimanathi Reserve Forest, one of the starting points of Noyyal’s journey, the water is so clear, you can scoop it up to drink.

What happens as it flows ahead?

The first of a two part series on the river.