Tribhuvandas Patel & Making of AMUL
While sixty years of ‘planning’ by the Planning Commission has been an expensive failure, the grassroots approach taken by Tribhuvandas Patel has made India milk abundant. As India goes solar, it should learn from his experience and create local ‘solar cooperatives’.
Column by N.S. Rajaram, Contributing Editor, FolksMagazine.Com
Learning from the grid failure
In his Independence Day speech delivered under the shadow of the recent catastrophic grid failure in North India (including Delhi) the Prime Minister as his wont mouthed a pious platitude: “Our next target is to provide electricity to each and every household in our country in the next five years and to also improve the supply of electricity.”
Apparently no one bothered to ask him how anyone could do one without the other—like providing electricity to ‘each and every household’ without improving the supply of electricity! It is one of those maladroit statements that Manmohan Singh seems to excel at. As a matter of fact he had made an identical promise in 2004 during the election campaign that brought his government to power. All they are trying to achieve is scarcity management, not real development.
In contrast, the Bihar Chief Minister Nitish Kumar, also speaking on the occasion of the Independence Day was more candid: “The current power situation is also a challenge … Sincere efforts are being made for improvement in all levels of transmission, distribution and production of electricity and we have evolved a comprehensive plan for the purpose… We are making sincere efforts to improve the situation but if we fail to make positive changes, I will not go asking for your votes in 2015 Assembly election…”
Something that is studiously ignored in all this rhetoric is acknowledging there is one state in India—a state no ‘secularist’ wants to name—where these promised goals have been met in the same decade in which the Sonia-Manmohan Singh government (and Nitish Kumar’s predecessors) have presided over a scenario that has gone from bad to worse. Most readers will recognize this state to be Gujarat under the leadership of Narendra Modi. In his Independence Day speech there were no platitudes or false promises, but a statement of fact: “When 60 crore people and 19 States were in darkness, Gujarat was lit, sparklingly with brightness.”
This simple truth is unpalatable to the secularist political class as well as much of the media. They continue to denounce Modi while raising the irrelevant issue of his lack of secularism (whatever it means) and reiterating his supposed culpability in the post-Godhra riots. (A false charge by the way; see http://folks.co.in/blog/2012/08/17/modi-and-the-mahatma-who-was-more-guilty/) But as we see below, Modi was following the example a now all-but-forgotten pioneer who with his model of local cooperatives turned India into the world leader in milk production.
Tribhuvandas, the forgotten pioneer
The famous White Revolution that made India the world’s largest producer of milk and milk products should be a major case study for business schools. But business school faculty from Harvard down have largely ignored its contribution while devoting attention to the bogus claims of the former Union Railway Minister and scamster Lalu Prasad Yadav. (This may have something to do with the fact that a great many business school faculty are failed businessmen who prefer show to substance.)
To get back to the main point, Narendra Modi, in building up the infrastructure in water and power in Gujarat had a proven model to build on. To his credit he drew the right lessons and empowered local groups instead of concentrating authority in the hands of a centralized bureaucracy, which has been the bane of the Planning Commission with its six decades of failure. The result is, in Gujarat there is real progress while the likes of Montek Singh Ahluwalia have given the country six decades of managed and sometimes unmanageable scarcity.
While Verghese Kurien is justly renowned for his contributions to India’s White Revolution, its founder Tribhuvandas Patel is not as well known to the public. It was his vision of milk cooperatives networked into a national grid that made it possible for Kurien to apply his management skills and make India the world leader in milk production. He was also the founder of AMUL, a name that is virtually synonymous with milk and milk products in India today. His achievement of creating a national grid by networking small producers distributed over a large area is worth revisiting today as the country embarks on a program of meeting its energy needs by exploiting solar power.
Tribhuvandas Kishibhai Patel was born on October 22, 1903 in the village of Anand in Gujarat, a village that he was to make internationally known by founding the Anand Milk Union Limited or AMUL. Founded in 1946 as a small cooperative it has now grown into a $2.5 billion giant. While it lists only about 750 people in its marketing division as employees, it has a pool of more than 3 million independent milk producers as members. In addition, the AMUL model has spawned many imitators in milk production and in food industry in general. It could serve as model for solar energy production also, especially in combination with the proposed national river grid.
As a youth Tribhuvandas came under the influence of Mahatma Gandhi and Sardar Patel and participated in the Freedom Movement. He was imprisoned several times in 1930, 1935 and 1942. He grew particularly close to fellow Gujarati Sardar Patel who impressed him with his capacity to organize people and get them to work towards a common goal. This was the lesson he took to heart when as early as the 1940s he began working with the farmers in the Kheda District under the guidance of Sardar Patel. Soon he set up the milk cooperative union in his native village of Anand to which he was closely attached. He was the first chairman of AMUL.
As the milk cooperative began to grow, he recognized that it needed professional management skills that he did not possess. In 1950, he brought in a brilliant young manager called Verghese Kurien (born 1921) to run AMUL. The rest, as they say is history. Tribhuvandas’s contribution was widely recognized with the Ramon Magasasay Award in 1963. The Indian Government followed giving him a Padmabhushan only the following year. The award seems inadequate given the magnitude and impact of his contribution when people who have done far less like Brajesh Mishra and Amartya Sen have received higher awards. (Also, why do Indian Governments always wait for foreign recognition before they do?)
Untypically for an Indian leader, Tribhuvandas was not ambitious for position or personal glory. When he voluntarily retired from the chairmanship of AMUL, the people—not the Government—rewarded him with six lakh rupees representing one rupee contribution each from six lakh grateful members of the cooperatives he had helped to start. He used this fund to start a charitable trust, named the Tribhuvandas Foundation— an NGO to work on women and child health in his native Kheda district. He was its first Chairman. Characteristically, he handed over the chairmanship to Verghese Kurien, when the organization started to grow rapidly, receiving funds from foreign sources.
At an international workshop, Dr.(Ms) Amrita Patel, Chairperson of the National Dairy Development Board, described the Tribhuvandas Foundation as follows: “Tribhuvandas Foundation, which is Asia’s largest NGO, works in over 600 villages in the State in the field of maternal and infant care. What is unique about the program of the Foundation is that it rides on the back of milk. It is the village milk co-operative that appoints a village health worker and pays an honorarium to the village health worker to undertake the work. So it is milk paying for health.”
The AMUL model, its impact
The effects of the Tribhuvandas-Kurien model was recently appraised by the World Bank in its recent evaluation report. It has been proved that an investment of Rs. 20 billion over 20 years under the program in 70s & 80s has contributed in increase of India’s milk production by 40 Million Metric Tons (MMT) i.e. from about 20 MMT period to more than 60 MMT in less than 20 years.
Thus, an incremental return of Rs. 400 billion annually have been generated by an investment of Rs. 20 billion over a period of 20 years. This has been the most beneficial project funded by the World Bank anywhere in the World. One can continue to see the effect of these efforts as India’s milk production continues to increase and now stands at 90 MMT. Despite this fourfold increase in milk production, there has not been drop in the prices of milk during the period and has continued to grow. This means that milk producers who make up the cooperatives have also prospered.
It has also yielded major nutritional gains. While the country’s milk production tripled between the years 1971 to 1996, the per capita milk consumption doubled from 111 gms per day in 1973 to 222 gms per day in 2000. Thus, these cooperatives have not just been instrumental in economic development of the rural society of India but it also has provided vital ingredient for improving health & nutritional requirement of the Indian society. Very few industries of India have such parallels of development encompassing such a large population.
This too is not the full story: these milk cooperatives have been responsible in uplifting the social & economic status of the women folk in particular as women are basically involved in dairying while the men are busy with their agriculture. This has also provided a definite source of income to the women leading to their economic emancipation.
It is a great pity that a true national hero like Tribhuvandas is virtually unknown to the public and ignored by the media while fakes and poseurs like Lalu Yadav and Rahul Gandhi are held up as messiahs of the poor. (There has been some talk of making a movie on Verghese Kurien, but it is more appropriate to do a documentary focusing on Tribhuvandas’s vision crediting also the achievement of Kurien as manager.)
Tribhuvandas Patel and Verghese Kurien—the visionary and the manager—made an ideal pair. The people of India are fortunate that they had such a dedicated and selfless pair to serve them. But the lesson goes beyond the achievement of individuals however exemplary they may be. The thing to recognize and learn from is the spectacular success of Tribhuvandas Patel’s approach based on empowering local cooperatives against the failure of the centralized planning model (borrowed from the former Soviet Union) even after 60 years. This is what we may look at next.
Centralized planning vs local empowerment
The White Revolution is a near textbook example of the wisdom of the old saying, “Think big, but start small.” Research managers know that when venturing into uncharted waters it is better to start on a small scale so that the problems become easy to identify while the cost of failure is still small. A bureaucratic mindset on the other hand prefers the reverse approach of a large program with unclear goals. This has been the approach followed by the Planning Commission.
An example of the latter is the NREGA (National Rural Employment Guaranty Act) that has drained the national exchequer while producing no tangible results. The same money allocated to a few pilot projects in river linking would have provided a valuable learning experience that might have come in handy today. It would have given productive employment to thousands. The Planning Commission on the other hand has provided lucrative sinecures to political favorites and their hangers on. It is obvious which path is to be preferred in trying to harness solar power.
Another benefit of this localized approach, as evident from the Milk Revolution is it benefits all segments of the population beginning with the milk producer. In contrast, the software and services boom benefitted a small urban elite while leaving most of the country’s population untouched. Developing the infrastructure based on river linking and solar power at the local level will benefit everyone while simultaneously providing meaningful employment to millions.
Gujarat has already shown what is possible. Combining this with Tribhuvanadas’s vision of local cooperatives will lead to a revolution in India’s destiny. But first it is necessary to get rid of ivory tower obstructionists who want only to create and manage scarcity. What the country needs are achievers, not scarcity managers.