LAHORE: Fearing collapse of loose milk distribution network comprising some 100,000 people in supply chain across the country in case of coronavirus outbreak, the dairy industry has urged the government to immediately restore the zero tax-rating (removed in 2017) for all dairy products to keep the prices of finished products affordable for common man.

“Pakistan Dairy Association (PDA) is a grouping of milk farmers and dairies representing 90 per cent of packaged milk. PDA members distinctively provide safe and healthy dairy products to consumers in an organised, quality controlled and regulated way,” the association said in a letter written to Prime Minister Imran Khan and others concerned recently.

It says that despite Pakistan being one of the largest producers of milk in the world and dairy sector making 11pc of its GDP, the sector is in a dire situation.

It regretted that milk farming was highly inefficient in the country for lack of scale and investment. Moreover, with over 90pc of milk sold raw and loose, Pakistan had an outdated supply chain, relying on thousands of people distributing milk in mostly poor hygiene conditions.

Fears milk supply chain collapse

It warned the government that if the virus spread in the country like it had elsewhere, Pakistan’s dairy landscape could face major issues.

It also warned that in case of a massive virus outbreak, the local traditional milk distribution network relying on an estimated 100,000 people would become unsustainable as it involved person-to-person contact and could result in rapid transmission of disease.

It mentioned that milk was a highly perishable commodity, and the country lacked infrastructure to replace the capillary-type technique to check detergent contamination in the loose milk in a safe way.

So in such a situation, it said, the packaged milk, specifically ultra high temperature (UHT) milk (which is non-perishable) was an important option to consider.

“UHT milk is safe for consumers and its quality can be easily tested through all the stages of the supply chain. In Europe, where UHT milk is prevalent, local governments have asked the industry to crank up production of milk especially of UHT, as panic buying is depleting stocks in stores,” the association maintains.

It said the local packaged milk industry, “with state-of-the-art equipment and ample capacity”, was ready to respond to this challenge to significantly increase production from current levels.

“In order to ramp up production, the PDA seeks support from the government to minimise the burden on the Pakistani consumers. So we humbly request to consider the reinstatement of zero tax rating (removed in 2017) for all dairy products with immediate effect in order to keep the prices of finished products competitive and in the reach of consumers,” the letter reads.

It urged the government to also reduce or waive off all duties on the import of powdered milk and raw packaging materials.

It asked the government to invest in the sector and waive duties to widen the infrastructure for milk collection at the farmer’s level, provide financing to dairies to support production and storage of maximum amount of milk.

“We believe that, if the above measures are taken quickly, it will not only save the spread of the pandemic, but will also provide safe and nutritional milk to the common man,” the association said.

Published in Dawn, March 23rd, 2020