From Our Special Correspondent

Daijiworld Media Network

Bengaluru, Oct 28: Karnataka Milk Federation (KMF), the apex body of the 13 cooperative milk unions in the State, which market Nandini brand of milk and other products across the State and outside has received a clean chit from Cooperation Minister H S Mahadevaprasad.

The minister, who spoke to the media in Bengaluru on Wednesday, has categorically ruled out any irregularities in the tenders for purchasing machinery worth Rs. 199 crore by the milk federation.

A committee headed by the Principal Secretary of the State Cooperation Department, which examined the functioning of KMF, has recommended that the KMF board has final authority in taking decisions related to tenders.

JD(S) MLA H D Revanna, who is one of the directors in KMF, had accused former KMF managing director S N Jayaram of being involved in irregularities in the process of inviting tenders for the Rs 199 crore worth of machinery just a few days before his retirement.

The minister said the KMF board would take a decision on tenders for purchasing machinery at its next meeting.

Govt to borrow Rs 2000 cr to bail out KMF, Milk Unions

He said the State Government has proposed to borrow Rs 2,000 crore from financial institutions to save the KMF and 13 milk unions, which have been facing severe financial crisis owing to glut in the milk production.

The State Government would raise the loan from financial institutions to bail out milk unions and developing infrastructure for storing surplus milk, Mahadevaprasad said.

The KMF and all milk unions have been incurring financial losses following surplus milk production during the last one year.
Even as several parts of Karnataka had been declared drought-hit, the State’s milk procurement has remained at an all-time high due to bumper production of milk, he said.

KMF has ended up with a daily surplus of 35 lakh litres.

The minister said on an average, the State produces more than 70 lakh litres against the demand for 35 lakh litres a day.

A total of 13 district-level milk unions and 14,000-odd milk cooperatives have been facing financial difficulties as there are no takers for surplus milk production.

Some of the milk unions have not cleared pending dues to farmers running into a few crores of rupees.

Paying of incentive of Rs 4 per litre of milk by the State Government was one the major reasons for surplus milk production, he said.

With poor infrastructure in districts, now milk unions have been transporting milk to neighbouring Maharashtra and Andhra Pradesh for manufacture of powder.

Currently, State is sending more than 10 lakh litres of milk to other states for conversion into powder, he added.