TOKYO - 11 Sep 2012: IBM (NYSE: IBM) today announced that Toyota Boshoku will use IBM cloudtechnology in worldwide manufacturing and engineering projects, including automotive design. The newIBM SmartCloud Engineering Desktop consists of a group of cloud solutions designed for industrial sectorclients that tap mission-critical 3D applications globally.The global manufacturing industry faces an urgent need to deploy complex design, development andproduction systems to diverse locations to keep up with tight competition and address changes in marketdemands. To better meet their needs, many organizations look to use cloud technology to build an agile,global engineering environment. These needs include global work sharing for design and developmentand collaboration in efficient product development in their worldwide supplier network -- all while reducingrisks and costs.Designed to enable an agile engineering environment for companies like Toyota Boshoku, the engineeringcloud includes technology from IBM and Citrix. By incorporating Citrix XenDesktop with HDX 3D Pro, IBMcan virtualize and securely deliver 3D graphics or other intensive applications and high-performingdesktops.Toyota Boshoku manufactures interior systems for automobile manufacturers in Japan and internationally.As an early adopter of 3D technology on the IBM Smart Business Desktop Cloud with Citrix XenDesktop,Toyota Boshoku has integrated computer-aided design (CAD) and Office applications on one desktop,which enhances productivity while reducing floor space and energy utilization. Loss of proprietarymanufacturing designs and processes, CAD files, financial information, customer lists, research data andany other information that gives a company a competitive edge can halt business operations.The engineers of Toyota Boshoku can now securely access their engineering data and intellectualproperty which is centrally stored through Desktop Cloud environment from anywhere, at anytime to sharewith teams around the globe. This solution brings a variety of benefits to engineers. For example,engineers are now able to access highly confidential assembly data from design rooms, project rooms,and factories without moving actual design data from the server to local PCs. In addition, because ofXenDesktop with HDX 3D Pro, they can view assembly data from a factory far from the servers where theoriginal data is securely located, without extending network bandwidth. This allows Toyota Boshoku tobuild a secure and accessible environment without adding high network costs.IBM will initially provide solutions for the desktop cloud environment designed for CAD applications anddigital document security. The desktop cloud CAD solutions will provide each designer with flexibleworkstations with powerful image processing capabilities for intensive design work. Centralizedmanagement of confidential information is also available to enhance data properties. In addition, securitysolutions for digital documents will help prevent secondary leakage of confidential information in CADapplications by managing security policies on the cloud. These policies can help secure data being sentand received concerning research, design and development, which is especially important for designersincreasingly using wireless or mobile devices such as tablets.“Because of IBM’s long history of working with clients using cloud computing, we are consistently applyingnew knowledge gained from across a diverse and international set of customers,” said Erich Clementi,senior vice president, IBM Global Technology Services. “As a result, global clients like Toyota Boshokucontinue to benefit from IBM’s unique expertise and industry focus.”“In the 3D professional graphic space, users demand very high performance and high image quality. IBM’sleadership in data center blade system technologies, combined with the virtualization experience of Citrix,means that we can implement solutions with the performance necessary to satisfy the needs of engineersand designers” said Gordon Payne, senior vice president and general manager, Desktop and CloudDivision, Citrix.As the basis for IBM SmartCloud Engineering Desktop, clients can leverage IBMs six global data centersto enable the utilization of standardized cloud services regardless of location. This will help them build aglobally-optimized engineering environment for their organization and provide an environment tocollaborate and integrate the power of global suppliers. Additionally, IBM Japan will actively work withindependent software vendors (ISV) and business partners that play important role in developing andoffering engineering solutions.About IBM Cloud ComputingIBM has helped thousands of clients adopt cloud models and manages millions of cloud-basedtransactions every day. With cloud, IBM helps clients rethink their IT and reinvent their business. IBMassists clients in areas as diverse as banking, communications, healthcare and government to build their
own clouds or securely tap into IBM cloud-based business and infrastructure services. IBM is unique inbringing together key cloud technologies, deep process knowledge, a broad portfolio of cloud solutions,and a network of global delivery centers. For more information about cloud offerings fromIBM, visithttp://www.ibm.com/smartcloud. Follow us on Twitter at http://www.twitter.com/ibmcloud and onour blog at http://www.thoughtsoncloud.com.For more information on the Citrix XenDesktop, visit http://www.citrix.com/xendesktopToday’s design-anywhere, build-anywhere environment requires speed, agility, control and visibility. Tolearn how to access to 3D graphics applications in the cloud from any locationvisit:http://www.citrix.com/site/resources/dynamic/partnerDocs/CitrixIBM_WP06251.pdf To see more onhow Citrix and IBM are helping leading-edge customers deliver 3D applications remotely, allowing them tocentralize design data securely, enable “workshifting” for designers, and deliver improved performance,higher security and reduced costs, see this video:http://www.citrix.com/tv/#videos/5913
AMUL38th Annual General Body Meeting held on 31st May, 2012Madam and Gentlemen,On 26th November, 2011, we celebrated the 90th birthday of DrVergheseKurien. I vividly recall that in the year1999, while addressing the Board of GCMMF, DrKurien had said, "We have traversed a path that few have daredto. We are continuing on the path that still fewer have courage to follow. We must pursue a path that even fewercan dream to pursue". Today, we are on the same path, where even fewer will dream to pursue. Our Federationthis year handled a peak of 14.5 million litres of milk per day. We continue to push ourselves towards excellencein milk production and serving our producers and consumers. As one of the top milk processors of the world, weat GCMMF have taken up the challenge to make milk available at every corner of the country. In line with thesame, we have planned an expansion to increase our processing capacity to 18 million litres a day by 2018, totake care of the future demands.Our commitment of making milk available to every corner of the country comes from the fact that milk is thesource of complete nutrition. Its indispensability for all people, rural or urban, poor or rich, cannot be contested.It not only suits the taste buds of most of us, but also offers a balanced diet with every essential nutrient inrequired proportion. As our age progresses, the most frequent problems that we come across are declining bonedensity and deteriorating digestive system. Milk comes as an elixir for these problems. Hence, while consumptionof milk is critical to infants, it is imperative to maintain good health of adults too. It is basically the best fuel forlife, and the worlds original energy drink. With this idea, we promote Indian Olympic contingent for LondonOlympic 2012 and wish our team the very best.Fortunately, with the replication of Anand pattern under the white revolution, we have been able to make thisnatural energy drink available to more and more people of India. Currently, per capita availability of milk in Indiais 280 ml per day which is higher than the WHOs minimum recommendation. But this is just an average figure.We actually need to ensure that it is available to every single person in the true sense and not in average terms.With increasing population and income, the demand for milk is going to rise multifold in coming future. It is hightime that we start working on our milk production as well as productivity to meet the coming demand.As per the NCAER report, the middle class or consuming class has been growing in the country and by 2015 isexpected to form 54% of the population as compared to 26% in 2003. With the increasing affluence, a new set ofconsumers who are willing to indulge and experiment with their taste buds, are emerging. This is in line with aglobal survey on changing food consumption habits that highlights people are increasingly looking forconvenience and premiumisation in food products.The same can also be inferred from the recent foray of large multinationals in these categories. A study byDepartment of Industrial Policy and Promotion has shown that in the past, foreign investments have increasinglybeen coming in the Food Processing Industry and these players have been targeting the new growth segments inorder to establish their hold. We have to prepare ourselves to face them.
Also, with increasing female work force participation and reducing time in todays busy life, the out-of homeconsumption has increased. However, people still dont want to compromise on health and wellness. This opensup new opportunities for ready milk based products that are nutritive and at the same time filling. This is provenby the fact that the food categories that lead in India by growth are Ice creams and Cheese.India, like the United Kingdom, is a nation of shopkeepers. Retailing has been contributing significantly to IndiasGDP; however penetration of organised retail has been low. This is however now changing with slow but steadygrowth in modern trade over the last 5 years which is expected to become two - fold in the next 5 years.While foreign direct investments boost many sectors with new employment opportunities and increaseddevelopment, it may be a double edged sword in retail. Government of India had recently proposed to permit upto 51% FDI in retail and 100% FDI in single brand retail. This certainly does not augur well for milk producers.We must be aware that milk producers get least returns from modern trade in most of the developed countries.The efficiency of these stores benefits only the retailers as they seek more profits. Farmers in USA and UK getonly 38% and 36% share of consumers money spent on milk respectively as per the International FarmComparison Network data. In last 15 years, this share of milk producers has declined from 52% to 38% in USAand from 56% to 36% in UK. As compared to that, the Indian milk producers get more than 70% on an averageand the milk producers affiliated to co-operatives get more than 80% share of consumers rupee. Key question iswhether the Organised retail trade would beable to operate at low margins as practised by GCMMF and other Co-operatives, failing which, they would not be able to maintain the farmers share in consumer price.GCMMF has experience of dealing with several large retailers of the world. What we have experienced is thatorganised retail trade tends to be monopolistic. There is heavy burden on manufacturer and marketer in terms ofsqueezed margin, long credit period and arbitrary marketing expense. For instance, organised retail chainsdemand heavy discounts and rebates. In summary, the large retailers will effectively kill innovation, squeezemargins and always threaten the brands with cheaper substitutes, imports or finallyin-store brands.In past one decade, the small retailer category of general trade in India that employs 32% of the Indianpopulation, has improved their retail outlets, presentation, service levels and customer orientation significantly inresponse to the changing environment. However, the modern retails and their deep pocket due to foreigninvestment will destabilise theretail trade which gainfully employs a very large section of society. Furthermore,closure of small stores and opening of large retail chains displace just as many jobs as they create friendly. Forinstance, it also affects community revenue by shifting away the money from the community. Local business uselocal resourcesand in turn pay for it resulting in improving community health, which is not the case for largechainsas they have got everything centralised, right from interior decor to product procurement.Liberal FDI policies in retail would not benefit Governments share of taxes as they would remain sameirrespective of the format of retail. However, there has been practice of demanding moreand more concessionsand liberal policies fromGovernment by the foreign organised retails. Furthermore, labour policies of largeretailers have not been employee-friendly for instance; some of the large retailers are often accused of belowminimum wages,poor working conditions, unfavourable employer-employee relationships and anti-union policies.In ourview, if largest and most reputed Indian corporate houses have invested in retailing in India, wedo notneed to look to foreign investors to invest in Indian retail.Someone beautifully said that when you buy from small shops, you are not helping a MNC CEO buy a thirdvacation home, but helping a little girl get school education, a little boy get his cricket bat, a mom put food onthe table or a family repay a housing loan. It is this India that we need to believe in and care for.I now present to you, our Federations Annual Report and Audited Accounts for the year 2011-2012.Review of OperationsMILK PROCUREMENTTotal milk procurement by our Member Unions in Gujarat during the year 2011-12 averaged 100.30 lakh kg(10.30 million kg) per day, representing growth of 6.09 per cent over 94.54 lakh kg (9.45 million kg) per dayachieved during 2010-11. Shifting from existing trend, the highest procurement was recorded during Februarymonth of 2012 at 130 lakh kg(13.0 million kg) per day, which historically used to be in January month.Furthermore, our Member Unions have started procuring milk from states other than Gujarat. This year, we haveprocured an average of 8.95 lakh kg (0.89 million kg) per day from states outside Gujarat, taking our total milkprocurement to an average of 109.25 lakh kg (10.9 million kg) per day. We have demonstrated our ability toprocess more than 14.5 million litres of milk per day almost for the entire month of February. We have been ableto win back farmers interest in milk production by providing attractive prices for milk, which we have raised by58% in last three years. This has resulted in high level of procurement both in Gujarat and in other states. We
have also been working very extensively on productivity per animal since very long which is contributing inincreased milk procurement.SALESDuring the year, sales of our Federation registered an impressive growth of 19.3% to reach Rs.11,668 crores(Rs.116.68 billion). Last year, our turnover was Rs.9,774 crores (Rs.97.74 billion). This is an impressive growth,considering the shortage of milk we faced in the beginning two quarters of the year and that GCMMF hasrecorded a consistent 20% of growth rate for last five years. I am also pleased to note that our Federation hasdone remarkably well in most of our value-added consumer packs. Amul Milk in pouches has shown animpressive value growth of 29%. Sale of AmulDahi and Amul Buttermilk have grown by remarkable 41% and27% respectively in value terms. Our sales in Amul Cheese have shown consistent and very impressive growth of23%. Our dairy whitener, Amulya too has shown growth of 26% over previous year sales.With enhanced focus on new product development, we launched frozen yoghurt under the brand name ofAmulFlaavyo. In addition to taking nutrition through milk to our consumers, we have launched our new maltbased beverage, Amul PRO, which contains whey based proteins, DHA and other essential nutrients for properdevelopment of mind and body. Innovation and continuous development has been our mantra. We haveintroduced some of our products in new contemporary pack designs - AmulMithaimate sweetened condensedmilk, Amul Lite Bread Spread and Amul Processed Cheese. Keeping developing consumer trends in mind, we alsolaunched gift packs in AmulFlavoured Milk Cans, Gulabjamun, Chocolates, Cheese and Ice cream under the subbrands of Utsav and Rejoice. Amul Ice cream has shown a growth of 12.4% in value terms over the last year. Atthe same time we have maintained our position of No. 1Ice cream brand in India leaving a wide gap with thenearest competitor.RETAILINGRetailing business at GCMMF Ltd. has received a fillip during the last financial year. Amul Exclusive parlours havereached to total tally of 6,315 which is almost 20% higher than the previous years number of 5,350. The rate ofgrowth has improved over the previous financial year wherein 965 Parlours were added at an average ofapproximately 3 outlets per day. Revenue from the retailing business has witnessed an encouraging growth withan annual turnover of `460 crores. The average throughput per APO is also steady and growing.The highlight of the retailing business has been the introduction of the casual dine-in format "Cafe Amul". TheCafe Amul concept is expected to witness further firming up during the coming year wherein we intend to addanother 10 Cafes. We have also received allotment of milk stalls at important railway stations to take the totalcount of Amul milk stalls to 170 at Railway Stations. Amul milk stalls in this segment not only come as anexcellent revenue source but also provide top-class services to the travelling consumers.We have also made a strong headway in Ice cream parlours and now boast of Indias largest chain of Ice creamparlours with a total tally of 600. We have been continuously developing new ways and new recipes to give a richbrand experience to our discerning consumers. We shall continue to focus on our retailing initiative and would beaiming to take the total tally of Amul exclusive outlets to 10,000 by end of the year.EXPORTI am happy to inform you that we had registered sale of `95 crores in exports of milk products. There is a growthof 15% in consumer packs. Government of India had banned export of milk powder since February, 2011 and theban is still continued. Due to this we were not able to export milk powders.However, as you know, our focus had always remained on selling consumer products which helps us in increasingour sales irrespective of world dairy product prices. Thus, in spite of ban on exports of milk powders, we couldget the benefit of faith of our loyal and trusted consumers across the globe. We will continue building on thisstrong base of customers in the coming year too.DISTRIBUTION NETWORKImprovement in both width and depth of distribution across urban and rural India continues to be the key focusin Federation. The unique combination of ambient, chilled, frozen and fresh distribution highways has alwaysbeen our huge competitive advantage. Channel partners associated with us for decades have been our majorstrength. During the year, 750 distributors, both for value-added dairy products and fresh milk have joined in ournetwork. Now, we have more than 7,000 distributors relentlessly servicing more than a million retail outlets fromdawn to dusk.Last year we rolled out Hub-n-Spoke model of distribution to explore the huge potential markets of small townsand rural areas. We added more than 150 super distributors and established our reach in more than 2,500 small
towns overcoming the challenges posed by inadequate cold chain facilities. Phenomenal success of thisdistribution approach in terms of generating sales volume has made it imperative that we continue this model toreach fast to still untapped markets of small towns and rural areas.Storage and transportation processes are amongst few key focus areas in Federation. Be it discipline in scheduleof transporting stocks to distributors or optimal utilisation of available storage space, no stone was left unturnedto ensure these initiatives. This has not only added efficiency in supply chain but also improved cost effectivenessof distribution channel, which is imperative in a competitive environment.To get exposure to our network of co-operative institutions, we organiseAmulYatra for our channel partners. Sofar, about 8,500 channel partners have got exposed to our co-operative institutions.CO-OPERATIVE DEVELOPMENT PROGRAMMEGCMMF family welcomes two new Milk Unions namely Amreli District Co-operative Milk Producers Union Limitedand Bhavnagar District Co-operative Milk Producers Union Limited as ordinary members. We now have 15ordinary members of GCMMF,a significant landmark in our 38 year journey starting with 6 Member Unions.During the year we continued to support milk producers of Junagadh and Kutch districts to organise theirco-operative societies at village level. Milk producers have organised 794 village dairy co-operative societies andtheir district milk unions have become nominal members of GCMMF.During the last twelve years, our Member Unions are implementing internal consultant development (ICD)intervention for developing self leadership among member producers and thereby enabling them to manage theirdairy business efficiently leading to their overall development. Under ICD, facilitated by specially trainedconsultants, 555 village dairy co-operative societies have conducted their Vision Mission Strategy (VMS)workshops, prepared their mission statements and business plans for next five years. Till date, 7,662 villagesocieties have prepared their mission statement and business plans under the initiative.Inspired by the success of VMS at VDCS level, Member Unions have planned to upscale it. Thrust areas of VMShave been planned to improve infrastructure and animal husbandry activities at milk producer level.In order to strengthen knowledge and skill base of young girls and women of the villages about milk productionmanagement, our Federation with technical collaboration and resources of Anand Agriculture University, hasinitiated "MahilaPashupalanTalimKaryakram" for women resource persons of the Member Unions and during theyear, 486 women resource person have been trained under this programme.Clean Milk ProductionUnder our quality assurance programme for consumers, GCMMF has supported the Member Unions forstrengthening infrastructure for quality and clean milk production by implementing various Government of India,Government of Gujarat and NCDC programmes. Our Member Unions have identified 4,000 potential villagesocieties for installation of bulk milk coolers (BMC) and till date, 3,390 BMC have already been installed and alsoimplemented CMP training programme in these villages. Continuing the cleanliness drive at village level, tillMarch 2012, Member Unions have implemented cleanliness module at 9,624 village societies. To enhance thelevel of cleanliness this year 8,332 VDCS (Village Dairy Co-operative Society) celebrated red tag day on "GandhiJayanti" - 2nd October and the Unions also gave awards to the best performing VDCS.Fertility Improvement ProgrammeConsidering a long term vision to reduce infertile animal from their milk unions; our Board had decided toimplement Fertility Improvement Programme (FIP) from the year 2007-08. During the last five years, they haveimplemented FIP in 4,860 village societies, and registered 3.48 lakh non-productive animals under FIP and out ofthis, 2.15 lakh milch animals have been made productive.Milk Productivity EnhancementOur Board has envisioned integrated intervention to achieve the objective of higher production and productivityin milk. To develop genetically superior animals with high milk productivity, it has been decided to implementpure breeding programme with 100% pure bull semen. In cow, pure breeding shall be implemented in Gir andKankrej and in buffalo pure breeding shall be implemented in Mehsani, Jafrabadi and Murrah. Non-descript andcrossbred cowshall be upgraded to 100% Gujarat HF and 100% Gujarat Jersey.To create good replacement stock and to include scientific calf rearing practices amongst farmers, our Board hasenvisaged implementing calf Rearing programme in which we plan to cover 48,000 calves in the initial phase.One of the difficulties in milk production is wide fluctuation in feed and fodder prices and its availability, whichhas been causing landless, marginal and small farmers reluctance towards milk production. With objectives ofproviding scientifically developed balanced mixed ration to animals, our Board has envisioned implementing totalmixed ration programme. This programme would help milk producers to maintain their animals economically andimprove animal health, fertility, productivity and have more milk production.
Sustainable ecological developmentGreen Amul Green India Campaign Dairy farming, like agriculture is dependent on nature, drawing resourcefrom the nature and hence requiring natures support for its growth and development. Over the years, due tointensive agriculture and deforestation, various natural resources have been depleted in Gujarat. To counter thiswe started a programme through which our milk producers were encouraged to plant trees in their vicinity. Everyyear, on Independence day, all our milk producers plant saplings of trees, to protect mother earth frompollution, climate change and global warming.During last five years, our members have planted more than 312 lakh trees and demonstrated their commitmenttowards preserving and contributing to improvement of the environment. For this activity, we have received fiveconsecutive Good Green Governance award from Srishti during 2007 to 2011.INFORMATION TECHNOLOGY INTEGRATIONWe have successfully completed SAP ERP Application implementation across the enterprise enabling it to achievebetter supply chain performance. The system helps improve planning and monitoring across the enterprise. Wehave also developed animal productivity process systems in order to help animal productivity improvement andits tracking effectively. Our Federation has also enhanced its MPLS-based Virtual Private Network(VPN)Connectivity at all its sales offices, member unions, milk plants, milk chilling centres and warehouses on acommon communication backbone to strengthen and automate the supply chain operations.STRIDE TOWARDS EXCELLENCEAt GCMMF, it is our constant endeavour to surpass our previous performance and achieve greater heights as wecontinue to serve our producers and consumers. This year, we are very proud to have received the EconomicTimes Corporate Citizen Award from Times Group for our contribution in socio-economic development of ruralIndia. It is also my pleasure to inform that this year we have risen to 18th position among the milk processors ofworld as per IFCN ranking from 21st rank last year and are poised to break in to league of top 15 by the end ofthis year.During the year we have also won the "Green Globe Foundation Award" at the Delhi Sustainable DevelopmentSummit 2012 for our mass tree plantation drive and contribution to environment by the milk producers ofGujarat. Taking further our excellence in sales and marketing, we were honoured with IDF Dairy InnovationAward 2011 in best new dairy drink for Amul Prolife Lassee and in best TV campaign category for Amul MasterChef.THE ROAD AHEADIndia continues to be the largest milk producing nation, with production of 122 million MT in 2011-12. This isabout 16% of world milk production. Most of this production is consumed domestically, yet at times, supplies areunable to match demand. This has been putting pressure on milk prices as the deficit has to be met throughcostly occasional imports of milk and milk products. To avoid this there is a need to increase milk production inthe country. Also, substantial part of the increased production needs to be converted to value-added products, toreduce dependence on occasional imports. This would also modernise the countrys dairy sector. Currently, milkprocessing industry is growing in India and about one third of dairy sector is organised. Co-operatives form 60%of the organised sector. However, share of private players has been continuously increasing. This may be analarming trend for farmers as well as consumers as private sector is known to capture profits and not serve bothproducers and consumers interests.Economic contribution of live-stock surpassed that of food grains in 2002-03 and has since remained about 5-10% higher as per scientists at NCAER. Its contribution to total agricultural output has increased from 15% in1981-82 to 26% in 2010-11. Despite this, it still receives only 12% of total public expenditure on agriculture. Oflate, growth of this sector is stifled by absence of policy focus. Indias livestock productivity is 20-60% lower thanglobal average, depending upon the breed of cattle, mainly due to deficiency of feed and fodder. Area undercultivation of green fodder has been decreasing as farmers shift to more profitable cash crops. This has led todoubling of fodder prices. Besides that, improvement in wages due to NREGA and increasing industrialisationwhich is leading to migration of people have resulted in lack of interest of people in taking up dairying. To avoidthis drifting away from dairying, we need to ensure proper prices to farmers. This is another reason forincreasing milk prices.Also, it is well discernable from Planning Commission Report 2011, that it is the small and marginal farmers whoare more dependent on livestock for income. Wherever contribution of livestock to farm income is higher, it hasbeen observed that poverty and deprivation is lesser.
Thus, to meet the growing demand and keep prices affordable for consumers as well as increase returns forfarmers, it is important to improve productivity and production of milk in the country. I am pleased to note thatwith the National Dairy Plan (NDP), the government is attempting to do the same. Also this would increasecontribution of co-operatives in marketable milk surplus compared to private players thus strengthening our ruraleconomy and the livelihood of our farmers.The NDP is expected to double our production in 15 years. It also aims to grow the organised sector to handle65% of the marketable milk surplus, from current level of 30%, by 2021-22, thus introducing transparency andminimizing malpractices like adulteration in the system.I have already mentioned how agriculture and dairying goes hand-in-hand. However, the agriculture income isexempted from Income tax whereas income earned by farmers from supply of milk is taxable. In fact, the incomefrom supply of milk helps small and marginal farmers to survive at the time of crop failure. Further, variousexpenditure on fertiliser, water, etc. is incurred with the help of income earned from supply of milk. Thus, incomefrom milk also helps agriculture sector to grow and meet the demand of ever increasing population. Consideringdairy as a part of agriculture and exempting it from income tax, would incentivise the farmer for milk production.We have made representations to the Hon. Prime Minister, Union Ministers for Finance and Agriculture on this.Milk co-operatives are primarily engaged in eradication of rural poverty and economic development of farmers inthe country. Milk co-operatives are currently taxed in the highest bracket of 30% + 3% education and highereducation cess. Thus, we feel that co-operative organisations like GCMMF and other state dairy federations whoundertake commercial operations on behalf of millions of milk producers of India, who are primarily in theagriculture sector, should be taxed at lower rates than corporate. Taxing is important as this way co-operativescontribute to the development of the country by way of paying income tax. However, about 15 years ago, tax onthe co-operatives was lower than the corporate rates and this difference should be maintained now as well.Further, milk co-operatives are involved in rural development programmes by spending the money forimprovements in productivity and on health of milch animals. Reduction of taxes considering the social andeconomicalmission of milk co-operatives would help milkco-operatives to improve their services to bothproducers and consumers.Dairy co-operatives provide products of mass consumption like milk, baby food, dairy whitener, butter, ghee, icecream, etc. at very reasonable rates to the consumers of India. This has made such products affordable for thecommon man to include them in his daily consumption. In the interest of consumers from all sections of society,VAT rates applicable to dairy products like baby food powder, butter, ghee, cheese, ice cream need to be reducedfrom 12.5% to 4%, so as to increase consumer demand, boost milk products and improve consumers health byway of better nutrition. It will also improve rural milk producers income and result in overall socio-economicdevelopment in rural areas.We applaud Governments move to implement 111th Constitutional Amendment to insulate about six lakh co-operative societies from political and government interference and to strengthen the co-operative movement.When we plan to improve productivity as well as production, we also need to keep in mind the markets wheresuch huge quantity of milk will be consumed. We need to explore new opportunities and markets. India hasgraduated from milk deficit country to largest milk producer in world. However, our exports of milk and milkproducts still remain insignificant in comparison to the existing players. We have been following the policy of notexporting milk powders to foreign countries so that availability in our country does not get hampered.We are expecting 127 million MT production of milk this year, which is likely to reach 180 million MT by 2020. Asubstantial portion of milk produced is converted into powders to be used in production of milk products duringdry season. Since, we have already started receiving good quantity of milk, which is expected to continue, thestocks of milk powders are poised to rise higher. High stocks of powder would result in falling price of raw milk aswell as milk powder which is happening currently. This will cause decline in the procurement price available tofarmers, and would be detrimental to the farmers motivation in milk production. Opening of export marketswould not only serve as outlet for excess of milk produced over the domestic requirements but also will keep thedomestic prices stable. We strongly feel that branded milk powders in consumer packs should never be banned.Thus, now when we plan to produce such large quantity of milk, it is imperative to relook at our export policies.Besides export, we need to cater to the changing consumption pattern of milk in India itself. Milk forms part ofthe basic food basket and with increasing number of middle class families in India; milk consumption is on therise in the country. This creates a significant need for making more and more of pure and unadulterated milkavailable to satisfy growing consumer demand.
With increased milk production, we hope to be able to expand our reach further to every part of the country.Over the past year we have been able to expand distribution to cover around 10 lakh retail outlets. Thisexpansion is necessary so as to create a competitive environment in the new markets that would offer customerswith vital choice of products.Apart from new geographical markets, we are also looking at expanding our presence in new product lines suchas gourmet cheese, yoghurt and pro-biotic products. Amul has always been selling products that cater toconsumers from the lowest strata to the top of the pyramid which has been giving us a competitive edge overother players. I assure you that we will continue to pursue the above path with dedication and commitment.ACKNOWLEDGEMENTBefore closing, I would like to thank all those who have helped to make our Federations operations successful.We are grateful to the Government of India for immense support received from various departments andspecifically from the Department of Animal Husbandry and Dairy Development. We convey our special thanks toNCDC for providing valuable support to our village co-operative dairy societies. We are also thankful to theGovernment of Gujarat for all the help and co-operation, extended to our organisation. National Co-operativeDairy Federation of India has been providing us with invaluablesupport in coordination with other agencies andorganisations. National Dairy Development Board has played a role in our growth and development. I am verygrateful to them.Institute of Rural Management, Anand, as always, has contributed to the perspective building andprofessionalisation of the management of co-operative sector. We express deep gratitude for its support.We are indebted to Vidya Dairy for having organised training programmes on dairy technology for ouremployees. We are also grateful to SMC College of Dairy Science, Anand, for strengthening the dairy co-operative sector, by providing technically skilled manpower. We express our sincere thanks to the College ofVeterinary Science and Animal Husbandry, Anand.Our advertising agencies, bankers, insurers, management consultants, technology partners, suppliers andtransport contractors have been of great help to us in managing our growth and are our partners in success. Weacknowledge their contributions and commit ourselves to continue and strengthen this fruitful alliance in all timesto come.The Indian Railways has played a crucial role in the growth of our dairy co-operatives since inception. We thankthem for their continuous support.We depend on the efficiency of our WC&F agents, distributors, retailers and most important of all, the patronageof our consumers, who have come to regard our brands as synonymous with quality and value. While thankingthem for their support, we assure them that we shall strive endlessly to delight them.Our Member Unions are our strength. We thank them for their guidance, support and co-operation without whichwe would not exist.Lastly, we thank the officers and staff of our Federation for their continued perseverance, loyalty and unflinchingefforts devoted to our cause.Thank you.For and on behalf of the Board of DirectorsP G BhatolChairman