Parveen Sultana Huda

Parveen is one of the widely recognized professional of Bangladesh with 23+ years of experience in the Human Resources and Project Management fields with leading organizations both as a professional and consultant. She is currently working for BRAC University's Centre for Entrepreneurship Development as a Project Manager to manage a 4 year project titled Digital RMG Factory Mapping - Bangladesh. This project is being funded by A Foundation and administered by BRAC USA. Parveen started her own consulting firm – Renaissance Consultants Ltd. – in 2006 and has so far provided HR Development; Management, Organizational Development, Project Management and Business Development support to various local and international clients. She has worked for some reputed foreign organizations including the Asia Indigenous People’s Pact Foundation (Thailand), British Council, RTI International (USA), PwC (PricewaterhouseCoopers LLC, UK), Agro-Inputs Project (AIP funded by USAID’s Feed the Future program), ILO, GIZ (previously GTZ), ITC (International Trade Centre – Geneva), ActionAid Vietnam, ActionAid Pakistan, etc.

Embracing the potential for a sustainable dairy value chain in Bangladesh

Bangladesh
South Asia
31. May 2017

On 30 April, 2017, a roundtable discussion was organized at Hotel Century Park to discuss the problems and opportunities currently present in the dairy / milk sector of Bangladesh, and what can be done to mitigate such problems and grasp the opportunities to grow this value chain. The discussion was organized by Renaissance Consultants Ltd. (RCL) with support from Practical Action-Bangladesh. Experts from both the private and development sector participated to share their professional knowledge on the issues as well as learn from other experts in this field.

The economy of Bangladesh is based primarily on agriculture, and livestock is an essential component of the rural economy and the livelihood of the subsistence farmers. The country has a sub-tropical monsoon climate and 84.4% of its population lives in rural areas. Dairying is the most ancient occupation established in the rural setting of Bangladesh, and it is a good source of income to the small and marginal farmers. However, the development of the dairy sector from marginal scale to mass production in Bangladesh has been unsatisfactory due to several problems. The dairy sector has also not received adequate attention in respect of information and research with present policies and issues. The demand for milk is growing at a faster rate than supply because of the rapid increase in population, creating a widening imbalance between demand and supply. This has resulted in high milk prices, which makes it unaffordable for households on lower incomes.

Institutional Challenges. According to Milk Vita, dairy sector growth is not happening at a satisfactory rate because of false rumors and allegations against the organization’s milk producing techniques. This has severely hampered milk consumption in the country as consumers after hearing this kind of news are afraid to drink or use milk in their daily life, they prefer to use powder milk instead. Then there is the significant price difference between imports and locally produced milk which makes imported powder milk favorable for price sensitive consumers. Lack of subsidy by our government in our country for the dairy sector is also another significant barrier to development. And then there is a lack of a strong set of governmental policies to protect the milk industry at home from foreign trade and imports.

The Bangladesh government must give subsidies for small scale farmers so that they can produce without worrying about the cost of production and get a right price for their output. The government needs to promote the message of why we should drink milk. Infrastructure needs to be improved so that transportation of milk along the supply chain can happen efficiently. A strong set of policies also needs to be developed by the government to protect the local dairy industry from trade and imports, especially from powerful neighbors.

Production and input. Farmers in Bangladesh are not interested in implementing technology for milk production because most of them are illiterate.  They usually do not take dairy activities as their primary business. In the dairy sector, for the farmers it is very difficult to break-even, let alone make profit. There is also a lack of proper and adequate source of good quality fodder. Artificial insemination in some areas of Bangladesh is also not up to the standard required for good breeding of cows. And at policy level, there is no plan for livestock insurance for the farmers, which makes the dairy sector risky for poor farmers.

Farmers need to be trained hands-on on the better production methods of milk using better technology. As for production, there should be enough to attract industry buyers. For fodder, there are lots of fodder substitutes which can be tried. Those are cheaper and nutritious too.

Women as farmers contribute a vital role in the whole dairy value chain in Bangladesh, but they are not still being recognized as farmers. There are a lot of models but they do not put enough concentration on the social and cultural barriers women face as farmers of milk production. Thus, women do not have the business mindset, for example how they will increase production and become more profitable.

Women farmers should be formally and equally recognized as farmers in the value chain. The cultural and social barriers they face should be minimized, and business mindsets should be promoted amongst them.

The case of Kazi and Kazi Tea. Kazi and Kazi Tea has an organic tea garden which needs lots of cow dung. For this, they involved the community by introducing a new model. They made Shamitis (cooperatives), where the members are all women. Then they asked them to submit 10 taka monthly. After a certain amount, for example for those who has accumulated 2000 Taka, they give them 10 times more loan to buy cows.

Kazi and Kazi Tea then would ask the women to give them a certain portion of the milk produced, and keep the rest for their families. This pays back the loan. At the same time, the cow dung that they need, they would take it and subtract it from the loan in terms of per kg price. So, when the total loan is returned, the cow belongs to the women. Gradually their money contribution increased and they bought high breed cows with higher milk yield. Now it can be seen that there are 1-3 cows per household. The women are very clear and confident about what they are doing. Some have built houses, some have spent for their children’s education, etc. Most loans they return back within 1-2 years. So, this reflects financial change, empowerment, life condition of family, at the same time Kazi and Kazi Tea is getting the required milk and cow dung for their tea garden.

The dairy industry of Bangladesh holds great potential for sustainable development of the country. Support is needed from all the operators and supporters of the dairy value chain, including the government, private sector, and the development sector. Even the media can play a pivotal part in this. There needs to be a governing board that controls the price of milk and supports the development of the sector. A selfless leadership and a solid commitment towards development is needed by the governmental bodies where an ecosystem needs to be created where all the stakeholders can smoothly interact, support, and collaborate with each other towards the greater good.

Read the discussions and conclusions in full in the Dairy Value Chain Roundtable report here.