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March, 1987

Joint Review Mission EEC/World Bank concludes:

Stop EEC dairy aid to India

Mission produces very critical report on India's Operation Flood

The official Joint Review Mission of the EEC and the World Bank which evaluated India's Operation Flood II programme last summer, has come to the conclusion that "a moratorium on imports of dairy products is more than appropriate and deliveries of milk powder and butteroil should take place only if and when a substantial and documented deficit shows up". According to the mission "imports of dairy products (either donated, subsidized or commercial) can, in the present situation of growing indigenous stocks, damage the strenghteninq of the cooperative industry".
These statements can be found in the Main Report of the Joint Review Mission of which the concluding 23 pages have just been released. The overall view by the mission of Operation Flood is quite critical. The report states: "The quality of achievement is quite uneven across India and the states, ranging from very satisfactory to disappointing. The situation has become very complex and very demanding in terms of rationalising present operations and building on them".

Within the coming months the EEC has to decide, primarily on the basis of the findings of the Joint Review Mission, whether it wants to continue dairy aid to India or not. Between 1970 and 1985 large amounts (368.000 tons of skimmed milk powder and 128.700 tons of butteroil) of dairy products have already been donated by the EEC to India for it's national dairy development programme Operation Flood.
A major objective of Operation Flood was to enable ten million milk producers' families to build a viable, self-sustaining dairy industry by mid-1985. Originally this was to benefit mainly small farmers and landless laboures, who were to supply milk to the urban consumers including vulnerable groups like pre-school children, nursing and expecting mothers at stable and reasonable prices.

In 1985 the Indian government asked the EEC to continue dairy aid for another five years (1986-1990). On December 6th 1986 however the correspondent in Brussels of the Indian newspaper Economic Times, reported that "EEC food aid in support of Operation Flood can be ruled out in the view of senior Community officials here". The article also states that "a concerted campaign earlier this year to get the community to withdraw it's support made a considerable impact on the European Parliament, whose limited powers do extend to the community's aid budget" (Annexe 2).

There has indeed been growing pressure on the policy makinq institutions in the EEC to phase out dairy aid to India and review the conditions under which any additional aid might be given. This pressure has on the one hand come from a number of Indian organizations, social scientists, dairy experts and others who have been criticizing many aspects of Operation Flood and it's continuing dependance on dairy imports. A campaign in Europe on this issue acquired a very broad base since the General Assembly of European Development NGO's adopted a resolution on the subject in April 1986. The primary focus of the resolution is an urgently needed reorientation of Operation Flood in favour of the rural and urban poor.
In the EEC the India Committee of the Netherlands (ICN) has been particularly active on the European Community's 'dairy-connection' with India. At the end of 1985 the ICN started the campaign 'EEC Milk Out Of India' with the publication of a campaign manifesto and a book (which has also been translated in English). The campaign is aiming to stop the vicious circle of EEC dairy aid to, and animal feed imports from India. A main point of criticism on Operation Flood itself is that the programme is largely geared to benefit the interests of middle and richer farmers and the urban middle class and elite. EEC dairy aid to India has been competing with local milk producers by depressing producer prices and interfered with the objective to make India self-sufficient in milk production.
The points for action of the campaign 'EEC Milk Out Of India' are:
- phase out dairy aid to India within two years
- no dairy aid for bottle feeding
- no aid for exotic cross-breeding
- stop EEC animal feed imports from India

The arguments put forward and the pressure exerted on the EEC by both Indians and citizins of the EEC did have effect.
In March 1986 the EEC postponed it's decision on dairy aid to India, which was first to be taken in the first half of that year. The European Commission (the executive body of the EEC) first wanted a new and elaborate evaluation of Operation Flood II (1978-1985) and await the results of this before taking any further decision. European Commissioner Claude Cheysson also announced then that the EEC could not continue to give dairy aid to India on a year-to-year basis, as had been done during 1984 and 1985. He made it clear that new dairy aid to India might only be given on a multi-annual basis. This decision in fact ended the policy of tacitly prolonging dairy aid for Operation Flood yearly, while the allocated amounts of free dairy products for Flood II had already been supplied.
After March 1986 the Gujarat cooperative dairy industry, who is the market-leader in babyfood with it's product Amulspray, seemed to have stopped advertizing this product thereby finally complying with the Indian National Code for Protection and Promotion of Breast-Feeding. This code was already published in december 1983 by the Indian Ministry of Social Welfare. We do not know the decision to stop advertizing commercial babyfood was the result of campaigning on the issue and/or of the fact that the National Code was to become (and has now become) a law by the end of 1986.

The above mentioned decisions by the EEC are in fact quite remarkable. At the end of 1985 it was generally expected that dairy aid to Operation Flood would be continued untill 1990. The EEC had upto 1986 spread only unqualified praise about the programme and a refusal of new dairy aid would not fit in this rosy picture. Also in March 1986 however, the European Commission published an interim report on Operation Flood II. This report is still mainly positive, but the EEC also admits for the first time that the programme has a number of shortcomings.
The present report of the Joint Review Mission is far more critical than the earlier interim report. The main findings reflect in fact most of the criticism that has already for years been put forward by Indian social scientists, dairy experts, Indian Dairy Action Group, journalists etc. and by European NGO's and researchers. Besides the Review Mission has added new information and insights.
Extracts from the report can be found in Annexe 1.

Probably within the coming weeks the European Commission will present a proposal to the European Parliament and the Council of Ministers from the member countries. This proposal is already long overdue, most probably because of the big interests involved (in particular the European dairy industry and the Operation Flood authorities) and the resulting pressures.
Therefore it is very important that concerned Indian and European NGO's and individuals now further strenghten the campaign to stop the export of dairy products to India and to reorient India's dairy policy in favour of the rural and urban poor.

Annexe 1: Extracts from the report of the Joint Review Mission:

Annexe 2: Article in Economic Times, December 6th, 1986:

Manifesto of the campaign 'EEC Milk Out Of India':

More information:
India Committee of the Netherlands
Utrecht, The Netherlands

India Committee of the Netherlands/Landelijke India Werkgroep - 23 juli 2003