Shakir Gujjar comes from a family of livestock farmers, who in his own words calls livestock farming as his “love affair and not some business as is the case with corporate dairy and meat businesses.” For the last many years, Mr. Gujjar has travelled all across the country to understand issues faced by the dairy and cattle sector to strengthen the Dairy & Cattle Farmers Association (DCFA) that represents the interests of small and medium cattle and other livestock farmers aiming towards achieving what Shakir calls a ‘white revolution’. In this interview with BR Research, Shakir talks about the challenges to Pakistan’s dairy and livestock sector.

BR Research: Let’s begin with your understanding of the challenges to growth in Pakistan’s livestock sector?

Shakir Gujjar: One of the biggest challenges to growth in Pakistan’s livestock sector is the government policy itself, where the policy of UHT processed milk particularly stands out.

UHT processors were given the permission to set up operations in this country on the basis that they will purchase milk locally. But they have not been doing so. I don’t want to take names, but if one company sourced 300,000 litres of milk locally and sold 6,300,000 litres, then another company sourced 500,000 litres and sold 8,500,000 litres. This clearly shows that UHT players are using more imported milk powder than milk purchased domestically. A lot of milk powder is actually smuggled or under invoiced from India and Iran. Indian data for instance shows that two years ago India exported 90,000 tons of milk powder to Pakistan, whereas Pakistan’s customs data shows that we imported 45,000 tons from India.

Secondly, milk prices need to be uncapped. How can a district management group from civil services set the prices of milk when they know nothing about the dairy and beef business? For small farmers, input prices are not government controlled, but output prices are controlled. For corporate dairy sector, both are free from government control. This is unfair competition.

BRR: What about the pre-mature culling of animals? Do you see that as a challenge?

SG: That is indeed one of the biggest problems for the livestock sector. And this prematurely killing of generations of our animals is being done by us – the small dairy and cattle farmers. A few months ago, you must have seen media’s hue and cry over meat of young calves being sold in Karachi. That was done by small farmers from our association, to which we have been staunchly against and trying to improve the situation.

But you have to understand their side of the story. Why would these farmers buy Rs200,000 buffalo, milk it for 6-7 months and then slaughter it instead of having it raised and bred for another cycle? It’s because the market does not offer any incentives for it. Because these small farmers have no incentive – neither price incentive because milk prices are regulated, nor subsidy on inputs – they have no option but to kill cattle generations prematurely.

At one point, every day 2200-2300 young calves were being slaughtered for meat market. At an association level, we have been taking strong action against these practices but unless the government fixes its pricing policy, we will have little success.

Milk production of loose milk industry is standing on the clutches of RBST and somatotropin injections. At an association level, we are also trying to improve our local breeds instead of getting milk through injections. The injections are officially banned, but they are still being sold through the smuggling channel.

BRR: You mentioned improvements in breed quality. How would you evaluate the performance of cattle breeders in Pakistan? Also, should Pakistan even spend decades on developing local breed as against using imported bovine genetics to gradually convert cattle stock into imported breeds – as some people seem to argue citing the case of Brazil’s embryonisation programme.

SG: Cattle breeders’ association existed in Pakistan until a few years ago. But that project now stands shelved. Even if it were active, it’s just one project, whereas we need countless such projects across the country. The government will have to give lands to cattle farmers outside the city limits where they can raise cattle. Currently, Pakistan mostly has small farmers who are too small to actually breed, or there are dairy parlours who know little about breeding - they are in the business of only milking.

As for imported breeds, I would like to stress on the fact that God has created animals according to the requirements of the land. The world is moving towards organic and locally sourced products whereas Pakistan’s corporate sector want us to shift the industry to imported, genetically modified breed. People must be informed and educated about the superiority of local breeds. For example, the offspring of water buffalo grows and puts on weight the fastest compared to any beef breed in the world.

Don’t take me wrong, it is the need of the hour to make controlled sheds and rely on imported cattle to meet local demand, especially the CPEC driven demand to be able to export dairy products outside Pakistan. But that does not mean that our policy should lose focus from developing our own breed. We have to learn from the breed developing experience of the world and import bovine semen and embryos to improve our breeds.

BRR: So what specific measures you think the government should take towards improving local breed?

SG: Ninety-eight percent of milk and beef supplied in this country is by small farmers who own no more than 5-7 animals each, and by commercial farmers who own no more than 300-400 animals each. Instead of educating our farmers, and improving our own breeds, our government is now talking about creating an import-led model. If the farmer is uneducated, is it the fault of the farmer or the government?

So in addition to training and development of small and medium farmers, provincial and federal governments should sit together and give incentives to livestock industry to move towards breeders’ societies and dairy farm cooperatives to grow our livestock. Farms should be kept outside the city, and milk should be distributed through the cold chain model.

In the short to medium term, the government seems to have no option except to move toward corporate dairy farms based on imported cows. This is because in the wake of CPEC, farming sector will have to grow scale, and if we don’t head towards that import-dependent corporate model we won’t have milk or beef in the decades to come. In that vein, imported semen and embryo when crossed with local breed is a good solution going forward. But corporatisation should not come at the cost of killing the local breed.

Previously I was a firebrand critic of imported cattle and corporate firms. But when I learned about the system after taking charge as the president of this association and after interacting with stakeholders at highest level, my views changed and I realised that as CPEC becomes a reality we will have to work on imported breeds simultaneously with local breeds, because time is of the essence.

BRR: What are your estimates of market size of milk industry in Pakistan?

SG: Pakistan produces 54 to 60 billion litres of milk per year, depending on whose estimates you rely on. Even at assumed average producers’ rate (and not retail rate) of Rs70 per litre, the milk economy is at least Rs3.78-Rs4.2 trillion per year. That’s nearly 10 percent of the country’s GDP, which is another reason why it would be criminal to convert this industry into imported-cattle model. We have to go local, though of course relying on imports as a stopgap measure.